France: Further relaxation of 35-hour week proposed

The socialist government at the time introduced the 35-hour working week through the “Aubry” laws of June 1998 and January 2000. The legislation sets normal working time at 35 hours a week (or 1,607 hours or 218 days a year, where working time is calculated on an annual basis). Employees may work more than 35 hours a week (up to a general statutory maximum limit of 48 hours), but this entitles the worker to a premium rate of pay and/or time off in lieu, while overtime hours are subject to statutory annual limits.

The draft legislation on payment in lieu of days off was submitted on 12 December 2007 and approved by the lower house of parliament on 20 December. The upper house was examining it during January 2008.

The Aubry legislation allowed agreements whereby employees continued to work more than 35 hours per week, but had their annual working time reduced though extra days off (known as “working-time reduction days”, or journées de réduction du temps de travail, JRTTs). According to figures cited by the government, 38% of employees are covered by such schemes and receive an average of 13 additional days of leave per year. The draft legislation will allow these workers, if they so wish, to convert these extra days off into pay – known as “monetising” JRTTs – on a one-off basis.

Almost 10% of employees (mostly managerial and professional staff) work under “inclusive” working time schemes, also involving a certain number of extra days off per year. Under the draft legislation, they too will be able to convert this additional leave entitlement into pay. This will also apply to the time-off rights stored up by the 4.6 million employees who are covered by “time-savings accounts”. According to government figures, 720,000 employees have banked rights to at least 15 days off in such accounts. Currently they may receive pay in lieu of these banked hours only if this is specifically allowed by a collective agreement.

Under the draft legislation, all employees concerned will have a right to have all or some of their additional days off compensated in cash by their employer. This involves paying employees for the hours concerned at the rate of pay due for overtime hours (a statutory premium of 10% or 25%).

The scheme is a one-off exercise. It applies only to time-off rights acquired up until 30 June 2008.

The sums received in respect of time-off rights acquired up until the end of 2007 will be exempt from most employees’ and employers’ social security contributions.

The minister of labour, Xavier Bertrand, believes that the scheme will be attractive to employees, citing several examples of companies where workers have already expressed interest in exchanging their JRTTs for money and thereby increasing their working time. He believes that employers – who had requested such a measure – will often prefer to pay their staff (even at a premium rate) rather than undergo the disruption that may be caused by workers taking their additional days off, or have to use temporary agency staff to cover for them.

According to Bertrand, a worker earning the smic national minimum wage who “cashes in” five JRTTs will receive €370, while an employee earning €3,800 a month will receive nearly €1,000 in return for five days.

In December 2007, the government announced that it wants to allow company-level collective agreements, signed by trade unions with majority support among the enterprise’s workforce, to provide for weekly working time exceeding 35 hours. While retaining the 35-hour week as the starting point for calculating overtime, it wants to move from a uniform rule on normal weekly hours to a system where these are set in a decentralised way that suits individual companies and their employees.

Sarkozy announced the plan at a meeting with national trade union confederations and employers’ organisations on 18 December, during which he unveiled his “social agenda” for 2008. The president set out proposals for reform in a range of areas relating to employment, purchasing power and industrial relations. He stated that the social partners would be consulted on some of these reforms and given the opportunity to negotiate national cross-sector agreements on the others. Working time is among the latter themes.

Following the meeting, the prime minister sent the social partners a document giving details of the government’s proposals. He wants the partners to negotiate a national cross-sector agreement on working time by the end of March 2008. If an agreement is reached, the government will enact legislation to implement it. If the social partners fail to agree, the government will propose its own legislation.

According to the document, the government’s aim is to give companies and employees the possibility, as already exists in other major European countries, to establish together, through collective bargaining, a “work organisation best adapted to the development of the company and the expectations of employees in terms of purchasing power and time management”. Working time should become a “privileged sphere of action for a renewed social dialogue”.

The document states that the current regulatory framework for working time is so complex that it often prevents practical solutions that meet the wishes of employers and employees. The rules on the duration of working time involve a series of “ceilings, thresholds, quotas and authorisations whose justification is often fragile or dated”.

Over time, the government argues, the combination of legislative and collectively agreed norms has limited the possibility to negotiate over the duration of working time “closest to the realities experienced by companies and their employees”. The law has deprived sector- and company-level collective agreements of room to manoeuvre. This situation is “damaging to many companies, which suffer from a lack of ability to react”, while employees often have a limited ability to “make choices, collective or individual, between work and pay”.

To achieve a clearer regulation of the duration of working time better adapted to workplace realities, the document poses a number of questions for the social partners to consider, as follows:

• What should be the domain reserved exclusively for regulation by law? The government suggests that the legislation on working time might be refocused so that it mainly lays down only the necessary rules to protect workers’ health and safety. It asks if the law should continue to regulate overtime quotas and time off in lieu, and if it should be possible to deviate from some legislative provisions, and if so in what circumstances.

• What should be the domain reserved for regulation by collective agreements, and what should be the relationship between sector- and company-level agreements?

• What should be the conditions under which company-level collective agreements could determine freely the duration of working time, while respecting legal maxima? The document also asks what rules should apply in such cases with regard to the point beyond which working hours become overtime, and to overtime pay.

• How could collective bargaining on working time be arranged in small and medium-sized companies (where there are often no trade union representatives)?

• What room should be allowed for individual agreements between an employee and employer on working time, notably in terms of the balance between work and time off?

The moves by the president and government to make the 35-hour week more flexible have met with a barrage of criticism from trade unions, which believe that the basic principle of a statutory working week is under attack. They argue that the government’s wish to “dismantle” the 35-hour week is “hypocritical” and “untenable”, and constitutes a major reversal of employees’ rights.

The CFDT union confederation claims that the “attack” on the 35-hour week “owes more to an ideological process than to economic reality”. It will mean the end of the statutory working week and therefore call into question the whole concept of overtime and overtime pay premiums, which is the basis of the government’s “work more to earn more” approach. For the CFDT, this undermines the president’s promises on improving workers’ purchasing power. The confederation insists that all discussion of working time should start from the basic premise of the 35-hour week.

The FO confederation also rejects the “calling into question of the statutory working week” and the government’s plans in this area. It opposes the idea of companies having different normal working weeks and of giving a greater role to individual employer-employee agreements. The CGT confederation argues that undermining “the concept of a statutory working week common to all employees” will mean “turning back the clock more than a century”.

This article is based on material provided by Christophe Boulay, European Employment Review correspondent for France.