PARIS, Aug 31 (Reuters) - French President Emmanuel Macron's government unveiled a highly anticipated labor reform plan seen at home and abroad as a crucial test of his reform mettle.
The thrust is to allow a wider range of labor conditions to be set in the workplace rather than at the sectoral level. Another goal is to set compensation limits in unfair dismissal cases and speed up labor court processing of such cases.
The "El Khomri" labor reform law adopted in 2016 ran into stiff opposition from several labor unions whose main argument was that it undermined the primacy of France's Labour Code - a body of laws and standards built up over the past 200 years.
The new reforms go further. Here are key elements:
RULES IN SMALL COMPANIES
Employers of less than 20 people will be able to negotiate directly with employees on workplace rules even in the absence of in-house unions.
For companies of less than 50 employees without unions, a representative elected by employees will be able to strike deals with the employer.
MUTUALLY AGREED WORK CONTRACT TERMINATION
In 2008, the possibility for an employer and its employee to terminate a work contract by mutual agreement was introduced to avoid lengthy dismissal procedures for employers and resignation without jobless benefits for employees.
The new reform would allow several employees to negotiate such voluntary agreements together.
An employer will no longer be punished by labor courts if technical errors were made in dismissal forms but the dismissal is considered justified.
A new simplified dismissal form will be introduced.
SCOPE OF ASSESSMENT OF ECONOMIC GROUNDS FOR DISMISSALS
Labour courts currently assess the health of companies at the global level to decide whether they had economic grounds to dismiss workers.
The scope will now be reduced to the national level only, as is the case in most other European countries, giving more leeway for multinational companies to adjust staff levels in France.
The goal is to introduce a lengthy list of issues which can be set at the company level.
The El Khomri law introduced the possibility of opting out of sector-wide agreements to set overtime pay rates and the new reform would extend the list of opt-outs to other areas.
The goal is to cap unfair dismissal compensation awards and cut the time taken to reach verdicts in labor tribunals. The argument is that employers need more visibility on time and cost of disputed dismissals and will be less reticent to recruit if they have that.
Employees will now have one year to challenge a dismissal in courts instead of up to two years currently.
Attempts to include this in past years were dropped because the constitutional court first struck down the measure on technical grounds and the previous Socialist government later decided to push other elements of the reform through instead.
SHRINK NUMBER OF CONSULTATIVE BODIES:
The goal is to reduce the number of in-house forums via which employees are consulted on issues ranging from work hours and conditions to health and safety.
The government said it would merge three of the current four bodies for all companies of more than 50 employees.
INCREASE OF SEVERANCE PAY
In a concession to unions, severance pay employers have to give employees will be increased by 25 percent. (Reporting by Michel Rose; Editing by Leigh Thomas and Ralph Boulton)