One of Emmanuel Macron's key campaign promises was the reform of laws relating to employees, in order to help French companies respond in a more flexible manner to the challenges they are facing and become more competitive in the global market.
The current series of reforms follow on from some of the reforms Macron championed whilst he was Economics Minister under President Holland and the Loi El Khomri– but arguably go much further in certain aspects and constitute a significant amendment to French Labour law.
In particular, the 36 concrete reforms permit companies to negotiate a number of key issues on a company basis, rather than necessarily being bound by industry wide provisions – e.g. in relation to working time (although they will still be bound by an obligation to obtain the agreement of the representative trade unions at company level...) and are designed to encourage and facilitate the creation of jobs, putting the emphasis on local negotiation, creating a climate of confidence and providing increased legal certainty for employers.
The labour minister (Muriel Penicaud, former HR Director of Danone) has acknowledged that the measures are taking a risk – assuming that putting trust in the social partners to negotiate and giving more rights to companies to negotiate at a local level will pay off. There will be a review in two years' time to see if the bet has paid off.
Three main areas identified as requiring reform in order to achieve this aim:
- Employment law – this is the first chapter and the ordonnances covering these aspects were published a few days ago, on 31 August 2017.
- Still to come:
- The unemployment regime
Over the next few weeks we will be issuing a number of briefings highlighting the changes which are likely to be most relevant for you by identifying the key points to be aware of, plan for and make use of.
This first briefing is designed to give a bit of background to the process and an overview of the key measures. In future briefings we will go into more detail on the key points that are likely to be of particular interest.
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The contents of this publication, current at the date of publication set out above, are for reference purposes only. They do not constitute legal advice and should not be relied upon as such. Specific legal advice about your specific circumstances should always be sought separately before taking any action based on this publication.
© Herbert Smith Freehills 2018