Vocational training talks deadlocked

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In September 2001, after seven months of negotiations, the French social partners have not succeeded in reaching an agreement in the vocational training reform working group, which forms part of the current 'overhaul of industrial relations' project. The mechanisms for contributing to an individual 'training savings account' for each employee proposed by the MEDEF employers' confederation have proved one of the greatest stumbling blocks. The resumption of the negotiations is planned for later in the autumn.

Since early 2000, France's central social partner organisations have been engaged in discussions over an 'overhaul of industrial relations'- launched by the Movement of French Enterprises (Mouvement des entreprises de France, MEDEF) employers' organisation - which have taken place in series of working groups dealing with specific issues (FR0102134F). The working group on continuing vocational training has not yet reached an agreement. The trade unions have rejected the employers' proposals aimed at making the employee bear a greater share of the costs of training. Differences also still exist between the three employers' associations participating in negotiations: MEDEF, the General Confederation of Small and Medium-sized Enterprises (Confédération générale des petites et moyennes entreprises, CGPME) and the Craftwork Employers' Association (Union professionnelle artisanale, UPA).

The social partners were due to meet again in late September 2001, but the chances of reaching an agreement were limited. The government is keeping a close eye on these negotiations, whose outcome it is awaiting in order to finalise its planned reform of vocational training.

Toward a reform of the vocational training system?

An agreement on vocational training would affect France's 16 million private sector employees. The 1971 law that founded the French training system made the social partners co-managers of the funds which collect any money that is left over after individual companies have only used some of the money they must devote to continuing training in order to fulfil their statutory obligation in this area. These resources are subsequently used by the funds to provide more training, on a collective basis. This is an area in which, historically, the state's only role has been to use the content of agreements reached by employers and unions as a basis for legislation. Specialists refer to such items of legislation as 'negotiated laws'.

However, for around a decade, the effectiveness of the vocational training system has been coming under close scrutiny from politicians, experts and those directly involved. The government has been driven to legislate without prior negotiations with employers and unions, thus breaking with the tradition of social dialogue. The 'five-year law' of 1993 thus simplified the system of funding continuing vocational training, forcing the social partners to reduce the number of bodies collecting just over FRF 17 billion out of the FRF 142 billion allocated each year by companies for continuing vocational training. This number of funding bodies has since dropped from 250 to 100, as some sectors have been subsumed by others, thus reducing the amount of sector-specific bodies.

The inadequacies of the system of vocational training have been identified in a series of official reports (particularly parliamentary ones) since 1993, without an overall reform having resulted. The critique of the system, developed under the initiative of the previous conservative government, was more or less entirely repeated in a White Paper published in March 1999 at the request of the then Secretary of State for Women's Rights and Vocational Training in the Socialist-led government, Nicole Péry (FR9904172F). It was believed that, while the system's objective was to 'give employees a second chance', it had 'reached its limits' by allowing inequalities of access to training between employees to widen. The Secretary of State's publicly-stated preference was for a reform of the principles governing continuing training. This would mean moving from a situation in which training was an issue at company level, to one where it was an employee's individual right, transferable and collectively guaranteed.

The method chosen for drafting reform legislation was to use the results of a preliminary pilot phase carried out in collaboration with regional authorities and relevant parties within each region. The reform would also be conditional upon the content of the current vocational training negotiations between employers and unions.

Employers split over scope of reform

At the beginning of the first meeting in the negotiation process in the 'industrial relations overhaul' vocational training working group, MEDEF distributed a document to the unions on "guidelines for negotiation". Before opening discussions on these proposals, the employers' and union representatives present agreed to request that experts draw up an assessment of the current system's economic, legal and technical dimensions. The experts' report repeated the points previously identified in the Péry White Paper. It also introduced some key issues for the social partners to explore:

• the need to lift the ambiguity over the nature of that time spent on training which must be included in working time;

• re-examining the current distinction between the 'training plan' (plan de formation) - which is initiated by the employer, and about which employee representatives are only consulted - and 'individual training leave' (congé individuel de formation) - which is initiated by the employee;

• prioritising a shift from joint management of training to a model based on the joint provision of training courses, in which the social partners will be more involved in the content of training; and

• reflecting upon the relationship between sector-level and regional-level training organisations.

The unions gave a critical welcome to this expert report, stating that it was not the experts' job to make proposals. The other aspects of the report were deemed insufficient and even biased.

Since February 2001, the differences between MEDEF's and the unions' visions of the issues have crystallised as the meetings have unfolded. Yet the employers' delegation has shown itself to be the most divided over the need for a radical reform of training. Francis Mer, the chief executive of Usinor and head of MEDEF's delegation, has had to face hostility from UPA and CGPME over the establishment, through an intersectoral agreement, of an individual right to training which the latter say 'will deflect training away from companies' real needs and deprive employees' training plans of funds'.

Similarly, no changes in the system of collection of training funds have been proposed by the employers' side in the negotiations. Although MEDEF might have considered proposing the elimination of the statutory obligation for funding, vehement opposition from the two other employers' associations led it to withdraw the idea. Small and medium-sized enterprises (SMEs) are very keen on the practice of money being held as in a mutual fund, which enables it to be redistributed to small organisations.

The SME representatives, however, did agree to a proposal for a rise in the cost of training. The employers' plan provides for the obligatory contribution paid for vocational training by SMEs to triple over three years. It would thus rise from 0.15% to 0.45% of payroll costs for companies with up to 10 employees, as opposed to 1.5% for larger firms. However, UPA and CGPME warned at the most recent meeting in July 2001 of the difficulty they would face in having this rise in contributions accepted by their members 'due to the effects of the reduction in working time, the changeover to the euro and the rise in the SMIC [national minimum wage]'.

Unions united against employers' proposals

Although all the participants in the negotiations are in agreement over the fact that each employee should be a 'stakeholder' and decision-maker in his or her own professional development, no compromise has been reached regarding the implementation of this principle. The unions have argued for the emergence of a 'new right' and a 'new guarantee' to training - the wording used respectively by the General Confederation of Labour-Force ouvrière (Confédération générale du travail-Force ouvrière, CGT-FO) and the General Confederation of Labour (Confédération générale du travail, CGT). This would be an individual right, and therefore transferable from one company to another and independent of the person's status (ie in stable or precarious employment, or unemployed), and collectively guaranteed. This right could be utilised by the employee to design a career plan, validate expertise accrued through experience, or learn new skills. The unions differ solely over which practical method of implementation to use.

In answer to this demand, the employers' delegation proposed the creation of a 'training savings account' (compte épargne formation, CEF). 'Owned by the employee' and 'transferable between companies', this account would enable all employees, on a voluntary basis, to set aside the equivalent of at least one year of their working lives for training. The account would be used to fund two types of training: those selected as part of a 'concerted development plan', on the joint initiative of the employee and the employer; and those selected as part of a 'personal occupational plan', initiated by the employee alone, and developed outside the company. A third type of training would exist, chosen on the employer's initiative, which, in the employers' opinion, would be the equivalent of the current 'training plan', thus satisfying CGPME and UPA.

The employers suggest that employees should contribute to their individual CEF using days of paid holiday, some of the current reduction of working time, compensation for overtime and bonuses. The employer would only have to match 25% of such employees' contributions to the account. This proposal would, according to the unions, reverse the current proportions of funding of training, 75% of which is at present the responsibility of the employer. The unions are demanding an employer's contribution worth at least the equivalent of the employee's.

The other point of divergence relates to the carrying out of training outside working time. The employers are proposing that time spent training under the 'training plan', ie on the employer's initiative, no longer be counted as actual working time, and because of this, no longer counted in the calculation of overtime. Even the unions which signed a 1991 agreement on joint investment in training - the French Democratic Confederation of Labour (Confédération française démocratique du travail, CFDT), the French Christian Workers' Confederation (Confédération française des travailleurs chrétiens, CFTC), the French Confederation of Professional and Managerial Staff-General Confederation of Professional and Managerial Staff (Confédération française de l'encadrement - Confédération générale des cadres, CFE-CGC) and CGT-FO - are against this proposal.

The final bone of contention concerns workers in temporary, insecure employment. The current 'social modernisation' bill (FR0107172F), passed on its first reading in the National Assembly in January 2001 (FR0101121F), provides that the 'precarious employment bonus' for employees on fixed-term contracts should rise from 6% to 10% of the gross pay received over the period of the contract. Employers are considering paying this increase into the employees' CEFs. Summing up trade union feeling on this issue, the CFE-CGC representative in the talks stated: 'This is an ideological deadlock. The employers want the employees to bear the costs of changing over to the 35-hour week.'

Commentary

The only chance of success in the negotiations is if MEDEF abandons its wish to compensate for the current changeover to the 35-hour week (FR0001137F) by obliging employees to use the time freed up in this changeover for training. However, even if that were to be the case, the leeway available to MEDEF is limited by the pressure placed on the organisation by CGPME and UPA over training costs.

In terms of the content of the debate, the key issue of the lack of willingness for unskilled workers to take training courses has scarcely been touched upon. One of the means of influencing the degree of incentive - recognition of training in the form of pay and grading - although a union demand, does not figure in the employers' package. Lastly, the practical ways in which a collective guarantee of an individual right to training can be achieved in a company remain vague in the unions' proposals. (Catherine Vincent, IRES)