Uncertain future for La Samaritaine department store

La Samaritaine – a Parisian department store with iconic status – closed down on 30 April 2005. Since then, a plan to safeguard employment has made it possible to envisage redeployment for the workers concerned, with early retirement being the main measure used. Nevertheless, the future of the store remains uncertain, and ambitious plans for a shopping mall are still no further than at planning stage.

For safety reasons, the Parisian department store La Samaritaine closed down on 30 April 2005; the site is due to reopen in 2011 (FR0508101N). The closure was decided by the Louis Vuitton – Moët Hennessy (LVMH) group, which has owned the store since 2001. The LVMH group decision took both employees and trade unions by surprise – especially the French Christian Workers’ Confederation (Confédération française des travailleurs chrétiens, CFTC), which was the majority trade union at the department store.

Unions divided on actions to be taken

Of the 1,500 employees who were working at La Samaritaine in 2005, almost half were employed on site as product demonstrators by other companies and were not paid by La Samaritaine. As far as these employees were concerned, the trade unions disagreed on the actions to be taken – the unions involved included the General Confederation of Labour (Confédération générale du travail, CGT), the French Democratic Confederation of Labour (Confédération française démocratique du travail, CFDT), 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), the National Federation of Independent Unions (Union nationale des syndicats autonomes, UNSA) and the General Confederation of Labour – Force ouvrière (Confédération générale du travail – Force ouvrière, CGT-FO).

Some of the trade unions – notably CFTC – favoured taking La Samaritaine to court, contesting the impediment of the works council. Other trade unions, such as CFE-CGC and CFDT, immediately underlined the need to draw up a redundancy plan (plan de sauvegarde de l’emploi, PSE). In this respect, CFE-CGC emphasised that ‘the workers should be looked after, before the building’. Moreover, the fact that the site is not due to reopen before 2011 has been understood as a sign of little hope that the company’s employees would be kept on. After several months of equivocation, a PSE was drawn up in February 2006 and signed by CFDT, UNSA and CFE-CGC, as well as by CGT. The latter trade union confederation remains particularly involved in this case. The plan was negotiated on a two-year basis, backdated to the closure of the store, and expired on 30 April 2007.

Redundancy programme promoting early retirement

The redundancy programme made use of two companies specialised in redeployment, Sodie and Altédia (FR0507106F), to help the department store’s employees sort out their future employment. In all, CFE-CGC estimates that 96% of La Samaritaine’s staff found an ‘identified solution’.

The main measure implemented through the PSE was early retirement. Out of the 750 employees concerned in the plan, 250 workers, corresponding to a third of the employees, had the option to leave the company at the age of 55 years and benefit from the company-funded early retirement scheme. Some 131 employees of other age groups sought, and obtained, internal redeployment to other companies of the LVMH group. It should be noted that this opportunity was given to all of the store’s employees, but 295 workers chose external redeployment.

By the summer of 2007, out of the 295 employees who opted for external redeployment, some had obtained permanent employment contracts and others had started their own company or pursued long-term retraining. Some employees, however, decided to embark on personal projects, using the generous redundancy payment provided for by the PSE. To date, about 50 employees are still waiting for redeployment.

In February 2007, CFDT, UNSA, CFE-CGC and CFTC signed an additional agreement to the PSE to encourage further departures by reducing the age for early retirement to 50 years of age.

Commentary

As is often the case in France – despite the then government’s intention to limit the use of age-related measures – the PSE largely employed early retirement as the main response to the company closure. Furthermore, the age threshold for this strategy has progressively been reduced, starting at 55 years and eventually being lowered to 50 years.

Carole Tuchszirer, Institute for Economic and Social Research (IRES)

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