Jan 29th, 2018, 04:26 PM

Ready, Aim, Fire!

By Elizabeth Nguyen Son
Image Credit: Wikimedia Commons/Clément Gruin
Things will get worse before they get better, as companies begin to take full advantage of recent changes in the extensive French labor laws.

Président de la République, Emmanuel Macron, has been under a lot of scrutiny since he came into office in May 2017. Amendments to the French labor code, which are making it easier for companies to hire and fire employees, were met with much discontent after they were taken into effect on September 23, 2017. Merely a few weeks later, companies like PSA, Pimkie, and Le Figaro envisioned letting go of hundreds of employees each. These reforms were planned in conjunction with retraining programs to help vulnerable workers find new jobs, but they have not yet been implemented, further worrying the already furious and skeptical public.

Lily Radziemski, who wrote an article on the labor law reforms for the Peacock Plume in September last year, observes, "France has always been known for having a particularly tight-knit ‘Code du Travail,’ which is a system of employment laws geared towards the protection of workers’ rights." Previously, the republic favored trade unions and employees, giving employers less power to dismiss staff." For critics, these laws guarantee too much protection; for example, under the current Code du Travail, the employer must specify a reason for firing an employee that fits within those outlined by the law. This isn’t as easy as it sounds. Once choosing a specified reason, an employer must then justify why it is necessary to fire this person over another in the same position. Because of complications like these, French firms are often too cautious in their hiring processes—contributing to unemployment—or may find themselves stagnant with a less-than-optimal team," Radziemski explains.

After years of being stuck at a less than satisfactory nine percent unemployment rate, Macron's dreams to remodel the French economic system may be swiftly crushed. While his attempt to imitate the Scandinavian-style economic model of flexible security, perhaps more commonly known as "flexicurity", initially seemed to come with good intentions, unions are growing impatient without the retraining programs they were promised.

Image Credit: Wikimedia Commons/Jules78120

PSA Group is wringing out the benefits of these changes and taking this as an opportunity to replace some of their current workforce with a younger, fresher, and more tech-savvy batch of employees. In order to do so without seeming forceful, PSA has proposed to buy out those that are older and willing to leave. Naturally, these incoming young workers will undoubtedly be paid less, helping PSA become more cost-effective. In their defense, however, youth unemployment has reportedly been stuck at 23% as of August 2017, making France one of the top ten worst countries in the EU to be job-hunting in as someone 25 years of age or younger, meaning Macron's reforms and PSA's buy-out plan could be extremely beneficial. Additionally, PSA has confirmed that they will be welcoming at least 2,000 young, low-paid apprentices and plan to be carrying out internal mobility with at least 6,000 position rotations.

On the other hand, these labor law reforms have been quite popular with not only young and hopeful job-hunters but also small to medium-sized enterprises and start-up companies. As previously mentioned, the idea is to supposedly propel the French economy toward a more flexible system, particularly when it comes down to unemployment.

Image Credit: Wikimedia Commons/Pablo Tupin-Noriega

When asked how this would affect someone who wishes to resign from their current position, Jayson Harsin, an associate professor at AUP with a PhD in Political Communications, explains, "As I understand it an employee can [now] resign and get unemployment insurance from the government, which they could not get before; however, they can only do this once every five years. They can do it more if it's for a reason like your spouse gets re-located for their job. The government frames it as being 'flexible' for both employee and employer, and they say it will make France more competitive and efficient. For critics, 'efficient' and 'flexible' is code for social and economic insecurity. Getting rid of unemployment, some argue, may mean what amounts to forced work, fewer protections against employers who fire for debatably fair reasons, and an all-around less human life."

In regards to firing employees, Danielle Savage, the Director of Internship and Career Advising at AUP, says, "They aim to make it easier for employers to let people go, and the rationale is that if it’s easier for companies to fire employees, they will be less reticent to hire new people on. This may or may not turn out to be true. Additionally, depending on the sector, it may be possible for organizations to hire employees for short-term contracts ('CDD') more often and longer than has been the case up to now, which could create more opportunities for organizations to hire new and young workers. Again, we don’t know if this will happen in large numbers or not."

The nation is particularly known for its tedious bureaucracy and being start-up unfriendly. Macron's aim when he revised le Code du Travail was, most importantly, to change people's long-standing image of France being a difficult country to do business in, into a more welcoming and positive one. All there is left to do is wait and see whether these reforms will help bring down the state's youth employment rate without forgetting about its older and seemingly unwelcome workers.

*Peacock Plume reached out to MEDEF for comment and received no response.