by Agnes a Paris
Mon Mar 6th, 2006 at 12:57:14 PM EST
[editor's note, by AgnesaParis]
Noteworthy article in today's issue of the Financial Times
providing a pretty fair assessment of the challenges the government is facing.
Link to the article:
De Villepin caught between protesters and opening markets
Yet another diary as part of my coverage of the reform the French rightwing government is implementing. It is a bold and sweeping reform indeed as it aims at, not less, dismantling the French labour code. If passed, this reform will leave Reagan and Thatcher far behind when it comes to ruthless liberalisation of the labour market.
I am convinced that this reform project is really harmful in the short and long term perspective. In the short term, it is hurting the country's moral very badly (for those aware of what the government has in store).
Over the long run, the risk of disruption of the whole social balance is not to be under estimated. It will widen the rift between employees and those self employed, and, as one put it, between work and capital ownership.
For that reason, it is critical that we remain aware of what is going on and not say, once it's too late, we did not see it coming.
I forgot to mention that the law project enacting the CPE (2 year probation employment contract specific to those under 26 years) was passed last night in Sénat (higher parliamentary chamber as opposed to the Assemblée nationale, the lower chamber).The law vas voted despite unanimous leftwing opposition and the bulk of UDF (moderate right) abstention. The debates are reported to have lasted ninety hours.
Noteworthy, this law is labelled law for equal opportunities.
For record purposes, the idea is to amend the whole corpus of employment contracts currently in force to come up with one single contract, providing for a two year probation period.
This probation period would apply to all new contracts entered into once the reform is enacted. A probation period is characterized by the fact that both parties can put an end to the employment contract without justification of the reasons why they do so.
The UMP government sees it as the triumph of flexibility that will cure the ills of our fossilized labour market and boost the country's competitiveness. This reform is based on the assumption that the current set of labour regulations is a deterrent for employers to hire people, hence the so much bemoaned French skyrocketing unemployment rate that the government targets to curb.
The topic has already been widely discussed here on ET, but it remains public belief that France is doing badly on the unemployment record when compared to its peers.
As luck would have it, the scope of the reform is starting worrying the business community.
Indeed, employers fear that disposing of people without justification will pave the way for an unprecedented number of lawsuits filed by employees claiming discrimination (racial, gender, etc.) as the motive for contract termination.
This is really bad luck as the government has restlessly bailed advantages to the French corporate leaders and now hopes to reap the electoral benefits of such a generous attitude.
Wouldn't that be well deserved for the UMP to have workers trade unions and employers team up against them? Wishful thinking at this stage, but one can indulge to dream sometimes.
Link to previous diaries
A two year probation period for everyone now?
Of the flexible job marketplace and those left behind