New Legislation | In depth look: What do the reforms say exactly?
Auteur : Flichy Grangé Avocats
Published on : 02/10/2017 02 October Oct 10 2017
Reform Goal n°1: Greater Flexibility
Negotiation in the workplace
Current French law: The law provides for the obligation in general of negotiation collective agreements with labour unions that will apply to all employees in the company, in particular regarding the organization of working time.
Macron Reforms: will allow for negotiation with employees on such agreements in companies with fewer than 20 employees.
In companies with a staff of 20 to 50 employees, the negotiation can be implemented with the staff delegates.
Current French law: The role of collective bargaining agreements (industry agreements) is to complement and adapt the existing legislation by dealing with all employment conditions and social guarantees granted to employees. These agreements cannot be less favorable to employees than the legal or regulatory provisions. They put in place benefits not covered by the Labor Code (minimum wage, pension plan, additional leave, etc.).
Company-wide agreements make it possible to adapt the provisions of the sector agreements to the specific conditions of the company.
If the company is not covered by a collective agreement, the negotiation can cover all the employees' working conditions, employment conditions and social security guarantees.
These are signed between the employer and the representative unions in the company.
Macron reforms: clarify the articulation between industry agreements and company agreements, specifying the roles of each level of negotiation.
The scope of company-wide agreements has been widened to make them the center of negotiation and determination of certain rules in the business not determined by the industry agreements, such as remuneration of overtime hours, seniority bonuses, and payment of a thirteenth month of salary per year.
Current French Law: The employer has to put in place three different staff representative structure: the Works Council, Staff Delegates, and Health and Safety Committee
Macron Reforms: There will be one single “social and economic committee”. Furthermore, by means of an agreement, a company council can be created, with the prerogatives of the union delegates.
Current French law: The implementation of voluntary exit plans is subject to the same procedure as for terminations as part of a social plan (PSE).
Macron Reforms: Voluntary departures will have their own formal legal framework.
Current French law: An employer considering economic dismissals has the obligation to seek out redeployment positions abroad.
Macron Reforms: This obligation will be limited to within French borders.
Current French law: The economic rationale for dismissals in corporate groups is evaluated at the group’s industry level in France and abroad.
Macron reforms: This evaluation will be limited to the French national territory, except in cases of fraud.
Reform Goal n°2: Less Risk
Current French law: employers are obligated to set out in the termination letter the justifications for the dismissal. They may not add any elements later on.
Macron reforms: At the employee’s request, the employer may provide more information on the reasons for the dismissal at a later stage.
Modification of Employment Contract
Current French law: a collective agreement cannot modify an employment contract. If the signing of a collective agreement does lead to the modification of the contract, the employees who refuse it must be dismissed on economic grounds and, if more than ten employees are concerned, benefit from a collective redundancy plan (PSE). There were certain exceptions for some agreements depending on their subject.
Macron reforms: Agreements which are implemented to respond to necessities linked to the operation of the company, or to safeguard or develop employment, may modify working time, remuneration, or the conditions of geographic mobility. Each employee who will refuse these new conditions will still be dismissed but it is specified that this termination is justified and that there is no need for a collective redundancy plan. The employee may only claim termination indemnities and the employer will have to credit the employee’s personal training account (CPF) with 100 hours.
Current French law: Terminations must be justified by a real and serious cause. Up to now, employees have been entitled to compensation for unjust termination, the amount of which was set by the judge who had full discretion.
Macron reforms: A scale sets minimum and maximum amounts for compensation, based on the employee’s length of service in the company.
Reform Goal n°3: New rules and rights
Current French law: The statutory minimum dismissal indemnity is currently 1/5 of one month's salary multiplied by the number of years of service. Beyond 10 years of service, 2/15th of one month's salary per additional year are added.
Macron reforms: This allowance will be increased by 25%. This increase will be made official by decree at a later date.
Current French law: Only under certain conditions is it possible for an employee to telecommute. There is a mandatory indemnification paid to the employee and the rules are strict.
Macron Reforms: greatly simplify the implementation of telecommuting and reduce the costs. It is now a mere modality of work and not an exception.
Current French law: Drudgery (pénibilité) of certain positions must be formally declared to the labour administration and there is a complex system for the calculation of “points” for an early retirement in physically taxing jobs.
Macron reforms: do away with administrative constraints that weighed down the formal declarations regarding the “drudgery” of certain positions. There will be a redesign of the point system used for evaluating workers’ entitlement to early retirement from positions that are physically taxing.
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