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Employment Relations in France

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1 Employment Relations in France
CHAPTER 7 Employment Relations in France Janine Goetschy and Annette Jobert

2 Lecture outline Key themes Context Unions and membership trends
Changing representative status of unions Employers The state Employee voice Collective bargaining Industrial disputes Conclusions

3 Key themes Features of contemporary French unions reflect the historical presence of anarchists and revolutionary socialists within the labour movement and the traditionally paternalistic and reactionary approaches of employers The industrial relations system is fragmented and adversarial due to lack of mutual recognition between the social partners The state plays a strong interventionist role and there is a multi-faceted system of employee representation within organisations Union movement is divided along ideological lines and suffers from continuing low membership. In contrast, employers are united and have high membership There has been a trend towards decentralisation of employment relations (and towards enterprise-level bargaining) since the early 1980s, but collective bargaining still occurs at industry and national level and coverage is high The number of strikes is declining, and most occur in the public sector and are short in duration

4 French employment relations context
France is the world’s sixth largest economic power in terms of GDP It has a population of approximately 63.8 million with a labour market participation rate of 63% Female employment is increasing (58% in 2006), but employment amongst young people (15-24 years) is falling (29% in 2006), largely due to rising school retention There has been low economic growth in recent decades despite there being no severe recessions High unemployment since the 1980s has resulted in government-run employment and training schemes Since the 1970s, forms of employment have changed in line with international trends, for example, growing temporary and part-time employment

5 The IR parties: historical context
Industrialisation and urbanisation occurred during the mid-nineteenth century Strikes were permitted in 1864 but it was still illegal to form unions Many informal unions were organised at the local level at this time, and unions became legal in 1884 The prominence of anarchists and revolutionary socialists within the French labour movement, combined with the often paternalistic attitudes of employers, has heavily influenced the development of French employment relations and explains the lack of mutual recognition between the IR parties The state has played interventionist role

6 The French union movement
The French union movement is characterised by pluralism, rivalry and fragmentation, as well as the scarcity of financial and organisational resources Union membership has been declining for decades (23% in mid-1970s and less than 8% in 2007) The five national union confederations are split along ideological and religious lines: La confédération générale du travail (CGT) La confédération française démocratique du travail (CFDT) La force ouvrière (FO) La confédération française des travailleurs chrétiens (CFTC) La confédération française de l’encadrement-confédération générale des cadres (CFE-CGC)

7 French union confederations
In 1966, the five French union confederations were granted the status of ‘representative unions’ by public authorities on the basis of five criteria, the most important one being independence from employers This identity confers exclusive rights such as the nomination of candidates in the system of employee representation within the firm representation on governmental and other consultative bodies, and collective bargaining These rights are not dependent on actual union presence within firms This system remained unchanged until 2008

8 Other unions A looser group of unions called the ‘group of ten’ was formed in 1981 comprising the ten autonomous unions in the public sector They originally had a corporatist orientation but adopted a more left-wing agenda when joined by group of postal and telecommunication unions. The group became Union Syndicale Solidaire (USS) There are several other ‘autonomous’ sector-specific unions (e.g. traffic controllers, journalists). They have no affiliation with the larger groups, which are have legal representative status

9 Explaining the decline in union membership 1
There is scepticism among younger workers as to the purpose and value of union membership, due to the restructuring of the French economy, high unemployment levels and the increased flexibility of labour contracts Other reasons suggested for decline in membership include employers’ preference for direct dialogue with employees inadequate union responses to new challenges gap between union leaders and rank-and-file membership, and union fragmentation and rivalry

10 Explaining the decline in union membership 2
Broader support for the union movement has declined for following reasons: Closed shop practices have been prohibited French unions traditionally favoured ‘militancy’ (fostering strikes and supporting political action) rather than recruiting a stable mass membership, becoming bureaucracies, and engaging in collective bargaining All wage earners benefit from union wins, even if not they are not union members No specific welfare benefits accrue to French union members as they do in other countries Employers often oppose any extension of union influence, however this practice has slowly changed over time The fragmentation of unions on ideological and political grounds hampered recruitment and retention of members

11 Explaining the decline in union membership 3
Unions do have more political and industrial influence than their low membership implies, e.g. in collective bargaining and in representative elections, public tripartite or bipartite institutions The recent increase in membership of CGT and CFDT is associated with the strategic rapprochement between the two confederations

12 Changes in the representative status of unions 1
The ‘representative status’ of unions has been subject to debate since 1998 when the ‘Aubry Law’ introduced the 35-hour working week This law required unions to obtain a majority of votes at works council elections or to be ratified by employees through a referendum in order to benefit from state support This was a major departure from the tradition whereby a collective agreement was valid if a union had ‘representative status’, even if the union only represented a minority of the workforce

13 Changes in the representative status of unions 2
In 2008, the five union confederations and three employer confederations reached a ‘joint position’ concerning ‘union representation, the development of social dialogue and the financing of unions’ Based on this, the criteria for determining union representation changed. Now a union must obtain at both plant and company level a minimum of 10% of votes at the first ballot to achieve representative status. Once it has this status it can negotiate with employers Through the changes, unions are seeking to become closer to wage earners and to renew dynamics of social dialogue The new rules could foster a different process of union reconfiguration and alliances, e.g. small unions will have to merge or set up alliances to survive

14 The employers In contrast to plurality of union confederations, employers have been united in their National Confederation, the Conseil national du patronat française (CNPF), now the Mouvement des enterprises de France (MEDEF) Nevertheless there are 2 smaller employer organisations, the Confédération générale des petites et moyennes enterprises (CGPME) and the Union professionnelle artisanale (UPA) MEDEF represents more than three quarters of all French enterprises, however members differ in their size, interests, diversity of capital ownership and management origins MEDEF negotiates on broad issues with unions but wages and work hours are excluded from these negotiations, with rates of pay being determined at the industry level

15 Changes in employer strategy
Changes to employers’ strategy since the post-1973 economic crisis include pursuing greater flexibility of labour contracts including flexible work hours Employers fiercely opposed the adoption of the Aubry law, which introduced the 35-hour working week in 1998, and the state’s increasing involvement in social protection agencies which are jointly managed by unions and employers In the 2000s, MEDEF negotiated issues of labour relations reform with unions, including unemployment insurance, OHS, collective bargaining and lifelong training The first female president of the MEDEF was elected in 2005, and is more open to dialogue with unions than her predecessors

16 The role of the state 1 State intervention is important in French employment relations, reflecting the traditional reluctance of unions and employers to use voluntary collective agreements. Instead, unions have pressed for legislation when the left was in ascendancy Since the late 1960s, there has been a close link between the formulation of industrial law and outcomes of collective bargaining. Industrial laws are often based on the content of collective agreements or the outcomes of tripartite discussions The state is also a major employer (approx. 5 million public service employees) and as such exerts influence on private sector pay rates The state also legislates increases in the national minimum wage (Salarie Minimum Interprofessional de Croissance (SMIC))

17 The role of the state 2 From the 1980s, governments have taken a range of measures to reduce unemployment, especially amongst the young and the long-term unemployed Leftist Prime Minister Lionel Jospin (elected 1997) introduced the ‘Jobs for Young People’ program and the 35-hour week law ( the Aubry Law), aimed at creating jobs The Aubry Law gave a boost to collective bargaining at the sectoral and enterprise levels, as it encouraged unions and employers to negotiate agreements to maintain wages and support recruitment In 2002, the right-wing Chirac government made the 35-hour week law less constraining for small and medium-sized enterprises

18 Employee representation within enterprises
Successive French governments have established a range of representative bodies at the enterprise level: Workplace delegates deal with individual employee grievances Works councils deal with workplace consultation Union branches and stewards represent their unions and participate in collective bargaining at the workplace French workplace delegates are not union representatives, however in practice a majority are elected on a union ‘platform’ In addition, workplace union delegates are appointed by the local union branch The representative institutions are not a coherent system but have developed ad hoc over time and there is confusion over roles Unions are present in 38% per cent of private sector companies with more than 20 employees

19 Works councils 1 Works councils are required in all firms employing at least 50 employees and are composed of employee representatives and employers, or employers’ deputies The employer chairs meetings which are held monthly. Each representative union can appoint a union observer to the council Councils have little real decision-making power except over welfare issues Every three months French employers are required to inform the works councils of the state of their companies: orders, output and finances Employers must provide councils with a range of other information about business activities

20 Works councils 2 Works councils must be informed and consulted prior to the implementation of large projects involving technological change when there might be consequences related to employment relations Works councils have information rights on redundancies and are involved in the development of social plans that emphasise redeployment as an alternative to redundancy Works councils are required to consider issues such as profit-sharing arrangements and changes to working hours, and agreement must be reached before implementation

21 Developments in collective bargaining 1
The hallmark of President Mitterand’s post-1981 reforms was the search for a new balance between state intervention and collective bargaining The Employee Participation Act (1982) gave employees the right to withdraw from dangerous working conditions, without stopping workplace machinery, and gave priority to collective bargaining Later the Act gave employees the right to make decisions on the content and organisation of their work and more generally on their working conditions The Collective Bargaining Act (1982) contained innovations to the French IR system, for example, in firms with established union branches employers were obliged to annually negotiate pay and hours Since 2001, compulsory bargaining at plant level has been extended to equal employment rights and sickness benefits, amongst other things However, there is no obligation to reach an agreement or bargain in ‘good faith’ and the employer’s decision is final

22 Developments in collective bargaining 2
There are three collective bargaining levels: multi-industry, industry and enterprise/plant Plant-level bargaining has greatly progressed since the beginning of the 1980s and has gained autonomy vis-à-vis the law and industry-level bargaining However, 84% of plant level agreements are in companies with more than 50 employees, which excludes half of total wage earners who are employed in small enterprises Hence, collective bargaining at the industry level remains important Industry-level agreements establish the basic labour relations rules for a given industrial sector. Labour laws also impose regular bargaining on wages and job classifications, equal opportunities and lifelong learning Multi-industry bargaining increased in importance during the 1990s. The aims are to achieve agreement on matters such as unemployment benefits and pensions Not all union confederations have supported multi-industry agreements Three major multi-industry agreements have been ratified since 2000

23 Social protection institutions
In addition to the three collective bargaining arenas, the IR system also includes national social-protection institutions, some of which are jointly managed by the employers’ associations and five representative unions These institutions include social security funds, supplementary pension funds, unemployment insurance and vocational training Since the 1980s, there have been serious problems in all areas of the social welfare system, reflecting the weakness and rivalry of unions as well as the social partners’ inability to undertake reforms without state intervention

24 Representative elections
The unions have a much higher degree of support than might be inferred from their low membership. Support for individual unions can be measured by both their formal membership and from the results of ‘social’ elections, such as those for the representatives of works councils and industrial tribunals Works councils election results for showed that in total the five representative unions obtained nearly 69.2% of the votes and the participation rate for works councils elections remains at more than 60% The industrial tribunal elections represent another indicator of union support. The are composed of councillors from the firms and are responsible for resolving individual grievances between employees and employers. The councillors are elected by all employees and employers. Here the CGT has remained the most supported confederation, but there is a very high abstention rate in these elections, reaching 74% in 2008

25 Industrial disputes The right to strike is guaranteed by the French Constitution, with qualifications Since 1963, public sector unions have been required to give 5 days notice before a strike. There is little regulation of strikes in the private sector Legal striking is defined as a ‘stoppage of work’; sabotage, working to rule or slowing production are unlawful Strikes must pertain to ‘industrial issues’; lock-outs are generally illegal Constraints have been placed on public sector strike activity in recent years which have been fiercely debated among unions There are elaborate procedures for the settlement of disputes including conciliation, mediation and arbitration, despite little legislation governing strikes

26 Trends in industrial disputes
Industrial disputes tend to be short-lived, as French unions have few financial reserves and generally do not grant strike pay France loses relatively few work days due to stoppages when compared with Italy and many English-speaking countries Compared to the 1970s, there has been a significant decline in the number of working days lost to strikes in the 1980s and 1990s (for both private and publicly owned companies) It is difficult to accurately attribute causes of strikes, as many disputes involve multiple issues. In 1998, a quarter of strikes were apparently about working time issues, whereas wages and employment matters apparently precipitated only half total strikes. By the mid 2000s, wages claims were the major cause of strikes Whilst there has been a decline in traditional strikes, new forms of conflicts have emerged such as work-to-rule and go-slow practices, demonstrations and petitions, and, while not well recorded, they have become significant features of recent industrial disputes

27 Conclusions There is continuing low union membership but there have been slight gains in recent years Various factors have worked against unions, including industry restructuring, expansion of the service sector, high unemployment, and the growth of flexible labour contracts. In addition, fragmentation of the union movement hampers its strength The influence of unions varies: unions are active and influential in large companies but rarely present in small and medium enterprises where they are largely opposed by employers. They are also more influential in the public sector Unions nonetheless are politically powerful exerting pressure through strikes – particularly in the public sector – as well as protests and political opposition The state maintains its prominent role in employment relations, most recently illustrated by the 2008 Act on social democracy and working time which maintains the 35 hour legal working week whilst allowing for some enterprise level negotiation of this provision

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