New ‘user-friendly’ Labour Code comes into force

On 1 May 2008, a new version of the Labour Code came into force in France. The Labour Code has been reworked ‘on the basis of established law’, with the aim of making it clearer and more practical in its application. However, according to opponents of the new code, the changes introduced create new relationships between the different articles of the code, which could lead to changes in jurisprudence.

Background

The process of reforming the Labour Code (Code du Travail) based ‘on established law’ started in February 2005. It has taken more than two years and 16 consultations with employer organisations and trade unions for the Ministry of Labour, Social Relations and Solidarity (Ministère du Travail, des Relations Sociales et de la Solidarité) to complete – in cooperation with the social actors and the Supreme Administrative Court (Conseil d’État) – the simplification of the Labour Code. The code’s new version is a tenth shorter than the previous one. The last revision of the Labour Code, which was originally drawn up in 1910 and concerns 16 million private sector employees today, dates back to 1973.

Modernising labour law

The initiative was originally taken by the then Minister of Social Affairs, Labour and Solidarity, François Fillon. In 2003, Mr Fillon entrusted the General Secretary and Human Resources Manager of the Renault group, Michel de Virville, with the job of preparing a report on the modernisation of labour law. Based on the work of a committee of practitioners and legal experts, the report, which was delivered in January 2004, sets out 50 proposals for ‘a more effective labour code’ (FR0408108F, FR0403104F).

For its part, the Movement of French Enterprises (Mouvement des entreprises de France, MEDEF) made 44 proposals for modernising labour law, which it considered to be excessively rigid and hindering corporate competitiveness.

The simplification process had been announced at the time of the December 2004 law on simplifying legislation, but was then postponed for six months following a request from all five national trade union confederations – the General Confederation of Labour (Confédération générale du travail, CGT), 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 the General Confederation of Labour – Force ouvrière (Confédération générale du travail – Force ouvrière, CGT-FO).

The reworking of the Labour Code took place in two phases, with the legislative part being established by a decree in March 2007, ahead of the part on rules.

Key aspects of new labour code

The new Labour Code, which was meant to be clearer and more practical than the previous code, consists of eight parts, including ‘individual labour relations’, ‘working time, pay and profit sharing’ and ‘lifelong vocational training’. The following aspects are its main characteristics:

• the articles are shorter and each of them contains just one idea. As far as grammar is concerned, the present indicative is more generally used, including for imperative forms – expressions such as ‘employers must consult the works council’ have been replaced by ‘employers consult the works council’;

• the introduction of ‘pedagogical’ articles which provide certain definitions;

• more articles have been introduced, amounting to about 10,000 articles instead of the 4,500 in the former labour code. These new articles replace the multitude of paragraphs within articles of the previous code;

• measures that exist in other codes have been externalised. Thus, rules related to childminders, sailors and farmers, for example, have been inserted in the respective specialised social action, maritime and rural codes;

• new parts reflect the importance given to the issue of health and safety at work by the Ministry of Labour, Social Relations and Solidarity;

• some legislative measures have been transferred to the part of the code devoted to rules;

• European and international standards have been incorporated into the new code, such as standards in relation to women’s employment. Thus, European interests have been respected in terms of equal opportunities for both sexes and non-discrimination in the labour market; for example, women are no longer prohibited from accessing certain arduous occupations.

Social partner reactions

At the beginning, the process of reworking labour law was marked by a controversy between legal experts as to whether it was a matter of ‘decodifying’ or ‘recodifying’ the existing Labour Code. The Constitutional Council (Conseil constitutionnel) settled the issue by stating that ‘recodifying’ meets an objective of constitutional value regarding the law’s intelligibility and accessibility.

Opposed to the reworking of the Labour Code, the left-wing parties and the Work, Employment and Training Union affiliated to the Unitary Union Federation (Syndicat national unitaire travail-employ-formation-insertion – Fédération syndicale unitaire, Snutefi-FSU) condemned the following aspects of the reform:

• downgrading of certain labour law articles into rules which are, by definition, easier for a government to change;

• restructuring of certain measures; for instance, the fact that rehiring an employee has been moved to the chapter on redundancies limits this obligation to companies with more than 10 employees;

• the creation of a new notion based on the ‘public’s needs’, in the chapter on the reasons for dispensation concerning Sunday work;

• externalising measures regarding certain occupations to other codes. This runs the risk of leading to different treatment for certain employees, thus contributing to different labour law depending on the sector and occupation in which one works.

The trade unions do not have a unanimous view on the final result. CGT-FO and CFDT did not cite any particular concerns when the new Labour Code appeared. On the other hand, CGT thinks that the reworking of the code is a harmful and expensive public relations exercise, which – far from making the law more accessible – in fact, makes it more complex. The trade union confederation regrets, in particular, that dismissal is entirely included in the part on ‘individual labour relations’ – thereby making it an individual affair and no longer a collective battle for employment. CFDT believes that the reworking of the code is generally satisfactory. The trade union regrets, however, that certain legislative measures have been downgraded to the part on rules and, above all, that the imperative form has been abandoned.

The National Association of Human Resources Managers (Association Nationale des Directeurs des Ressources Humaines, ANDRH) considers that the process of rationalising labour law is successful, as the new code avoids simply stacking existing texts together.

Commentary

The new Labour Code represents a significant number of new items for the new employment tribunal members (conseillers prud’hommaux), due to be elected in December 2008. Given the importance of interpretation in labour law, these tribunal members will have to manage new legal margins that have been opened up by the reworking of the code. Thus, the major operation related to recodifying labour law has not yet come to an end. In particular, the national multi-industry agreement, which was signed on 11 January 2008 on modernising the labour market (FR0802049I), will add many new articles, such as those on probationary periods, project-related employment contracts and separation by mutual agreement. That agreement will also remove articles concerning the new recruitment contract (Contrat nouvelles embauches, CNE) (FR0801029I).

Odile Join-Lambert, Institute for Economic and Social Research (IRES)