French labour reforms: why workers are protesting

Paris (AFP) - French President Emmanuel Macron's plan to overhaul the country's complex labour code, fulfilling a central campaign promise, sparked the first strikes and protests Tuesday.

While the 39-year-old centrist believes that making the labour market more flexible will help drive down unemployment of 9.5 percent, opponents fear an erosion of worker protections.

What he hopes will be a signature reform entails a major overhaul of the more than 3,000-page labour code which sets out workers' rights, with some measures dating back over a century.

Macron, whose Republic on the Move party enjoys a comfortable majority in parliament, intends to fast-track the reforms by executive orders which are expected to take effect late this month even before being ratified by parliament in the next few months.

- What's going to change? -

The reforms will give small companies in particular more freedom to negotiate working conditions with their employees, rather than being bound by industry-wide collective agreements negotiated by trade unions.

A cap has also been set on the amount of compensation awarded by industrial courts in cases of unfair dismissal -- a key demand of bosses who complain that lengthy and costly court cases discourage them from hiring.

Other measures include streamlining workers' committees, which are mandatory within large companies, and expanding the use of flexible "project contracts" which allow companies to hire people for a specific job.

In a further concession to companies, multinationals whose French operations are struggling will find it easier to lay off staff, while workers made redundant will receive higher payouts.

Several unions also fear new measures that would give employers greater leeway to launch voluntary redundancy plans.

- Why the protests? -

Philippe Martinez, the head of the Communist-backed CGT union leading Tuesday's protests, said the reforms give "full powers to employers" and has called for strikes and rallies.

The CGT has called another day of demonstrations on September 21.

But the leaders of more moderate unions, including the CFDT -- the biggest private-sector union -- and the hard-left Force Ouvriere have adopted a wait-and-see approach.

"We need to stop thinking that trade union action only makes sense when we demonstrate," the head of the CFDT, Laurent Berger, told Franceinfo radio on Tuesday, explaining how he favoured dialogue.

In parliament, the opposition to the changes is being led by the radical France Unbowed party of leftist firebrand Jean-Luc Melenchon, which is planning a mass march in Paris on September 23.

The right and centre-left parties in parliament have broadly backed the reforms.

- Will the protesters succeed? -

Hundreds of thousands of people demonstrated last year against plans by former president Francois Hollande to push through another round of business-friendly reforms to labour law.

The union-led action forced the government to water down their initial proposals, but despite months of strikes and demonstrations most of the measures cleared parliament and became law.

Observers will watch Tuesday for the scale of the protest movement: large crowds and major disruption would be seen as a show of union force, while a weak turnout would embolden the government.

- What's at stake for Macron? -

Macron is hoping to avoid a repeat of the months-long, sometimes violent protests unleashed by Hollande's labour reforms last year which would sap his political capital.

The reform comes as his approval ratings have plunged, with recent polls showing that only around 40 percent of French voters are satisfied with his performance.

Macron described critics of the reforms this week as "slackers" -- a remark seized upon by his opponents and Tuesday's protesters.

He is hoping the changes will encourage companies to hire more, while encouraging foreign investors who have long been discouraged by France's powerful unions and restrictive labour law.

The reform is also crucial to his wider plans for the European Union: he wants German cooperation in making institutional changes to the 28-member bloc.

He believes that improving French competitiveness is a necessary first step to build trust in Berlin and restart the Franco-German motor which has driven integration on the continent.