Global Employment briefing: France, June 2017

• France

• Employment law

01-06-2017

A new president: new plans for employment law

President Macron was elected President of France on 7 May 2017. Following his appointment to office he has announced major changes to employment law, expected to be implemented during the Summer of 2017.

Main proposed changes

One aim of President Macron’s new proposals is that in-house, internally negotiated agreements will be able to take precedence over collective bargaining agreements for aspects of employment beyond those of working time and time-off, as at present. In other words, employers should find it increasingly possible to derogate from collective bargaining agreements negotiated at industry-level. However, they will only be able to enter into an in-house agreement after holding a ballot of employees.

Ultimately, President Macron wants to decrease the number of collective bargaining agreements (applicable at industry level) to something nearer to 50 to 100 such agreements, compared with the current number of circa 700.

Changes are also proposed to social contributions. So, for example, President Macron has stated that overtime pay should be exempted from salary figures used in the calculation of social contributions. Also, employees who resign employment and are excluded from the unemployment fund on this basis will now be entitled to access unemployment allowances every five years.

A further proposal is to merge staff delegates and those of works councils into a single representative body.

Finally, President Macron intends to implement a mandatory scale of unfair dismissal compensation, to provide greater certainty over individual entitlement and employer exposure in such cases. Currently, the amount of compensation in unfair dismissal cases is determined by a judge on a case by case basis, according to the perceived harm suffered by the employee and factors such as the period of unemployment post- termination, the claimant’s age, length of service and family responsibilities.

Timescale

President Macron is currently meeting with trade unions to present his plans although there is already threat of strike action in reaction to the changes proposed. The intention is nonetheless to implement the proposals before the end of the Summer.