Monday, March 27, 2006

French Protests

In France a new labor law was passed, called the First Employment Contract (CPE), that allows business owners to fire an employee without any reason before two years of employment is over if the employee is under the age of 26 . The new law was passed in a slightly devious manner by avoiding a debate on the statute that is, apparently, standard before any regulation issued by the prime minister (Dominique de Villepin) is placed into law.

Large protests and rioting have been taking place throughout France because of the devious manner in which the statute was passed as well as there is strong resentment towards how the law affects youth employment. The main disagreement with the law is that giving an employer the ability to fire someone 26 and under after two years creates a strong bias against long-term employment for youths. Some argue that because of this bias “an employer will have an incentive to end their employment before the two years are up and hire another employee who is under 26.” (from This is especially prominent right now because youth unemployment has reached almost 20%, prompting me to wonder: how could Dominique de Villepin have thought that this statute would help lower the youth unemployment rate? Is the idea to give employers more of an incentive to hire younger people because they can easily fire them later? I would think there is a better approach.

Before the CPE was passed businesses could fire an employee with no reason only before one month of employment. It seems to me that two years is a bit exorbitant, though I also believe that an employer should have longer than one month as a trial period for the new employee. Three to six months, with no age restriction, seems at least reasonable to me and any more than that begins to give the employer incentive to continually find new people. I hope France is able to come up with a good alternative to the CPE that can show the rest of the world that strict labor laws, and strong labor unions, can make life more of a life rather than simply an employment history.

I applaud 35 hour work weeks. I love the idea of at least one month of vacation per year. And I truly doubt stipulations such as those would have any negative effect on business in the US.


jerems said...

I agree with you that there is a possibility for employers to exploit the law, and hire another employee as the 2 year trial period draws near. However, these young people are already being exploited. Employer's are getting around the current law, by hiring young people as "temporary employees", who I believe, receive none of the rights under the current law, and I'm uncertain about any other benefits they might be entitled to with this status. The part where we might differ is that I'm not necessarily a supporter of labor unions. I think they were vital in an era when worker's rights were not a matter of law, but have done the worker more of a diservice than good in the last 30 years. Here in the U.S. we are pricing ourselves right out of work. In fact, if you search the Seattle Times, about two days ago, the union for the Film Crews, just drove a movie that was being made in Spokane right out of town, because they wanted wage rates set for Los Angeles. Last time I lived there, the cost of living wasn't at the LA level. I understand that you think a 35 hour week is what the work week should be, and that we all should receive a month's vacation, who doesn't want that? It's not that I think we should try, or even could compete with foreign labor, there's no way that an American, or a Parisian could compete with labor rates in southeast asia. The trend though is pointing towards not just labor, but more technical jobs being shipped overseas. Vast amounts of Engineering and Architectural Drafting is being outsourced to India, and I'm not saying that's a bad thing, but someone would have a difficult time proving that the reasons aren't founded in the inability for businesses to compete in this current market without doing so. These businesses are outsourcing for profitability, and why shouldn't they? I wouldn't work my current job if I didn't make money, so who would??? I honestly have a hard time sympathizing with the protesters. If it's an issue of bypassing the law to get some legislation passed, then that's another story, but I feel like the workers in France, if anything, are over protected. I think that a company would value the experience that an employee can bring to the table after two years at a job would outweigh the costs of making them a full time employee. These are businesses, and training and productivity are measureable costs. Right now, the temporary employees are the measureable costs, and are dispensable.

Andrew said...

Yes, unions do end up costing a business more money because employees end up making more and you are also correct that this is causing business to move out of the country into undeveloped countries or countries that have hardly any labor laws. However, many of these massive corporations that are emigrating are making plenty of money in the US and are exploiting workers in other countries by not giving them a fair living based off of the profit they pull in due to these workers. This is not true of all corporations but a lot of them, especially in South East Asia. I am all for globalization in some respects, i.e. giving high-tech jobs to India is fine, as long as it does not hurt the population there, but many companies, and the IMF, WTO, etc. are actually doing more harm to these developing countries than they are doing good. So, yes you are correct: any human being that has the opportunity to better themselves usually will, and the same follows for business, but when the betterment harms others it should be stopped. Labor unions try to give the worker as much power as possible, as I think they should have, and try to protect the average employer from getting screwed by the company. Good examples of such companies that are opposing unions and successfully screwing their employers for profit: well really do I have to list them you can see their logos wherever you look. As for smaller business that gets harmed because labor unions impose too heavy of restrictions on them, I think there should be laws set up safeguarding a company from being forced by unions to give too high of wages or spend too much on benefits.

jerems said...

The worker should be protected, I agree. Just answer me this, how much is enough. Is one month of vacation ENOUGH, or will it be a month and a half two years from now? Is a 5% raise per annum enough? Or should it be 10%? It doesn't matter what the number is, because unions will always be asking for more. More more more. Why would a local Union in Spokane be demanding wage rates comparable to that of LA? That's ridiculous. Believe me, I deal with Unions every single day, and I'm not even scratching upon the stupidity of it. For instance, we had some wooden planter boxes in our contract. No subcontractor had it in his bid. As one of our options, the Superintendent said, let's buy some Cedar and build the damn things. But you can't do that, and guess why! That's Carpenter's work. My company is signatory to the Carpenter's Union, so if a Carpenter saw that, they'd picket on the basis that we are robbing them of work that they've claimed, and they should perform. We'd lose all our Carpenter's on our job if we refused to let them do the work. Then it gets even better, since the laborer's union is tight with the Carpenter's, they'd do what's called a sympathy strike, and we'd lose all of our laborer's. I just don't see an end to it, and I've heard a lot of people at UW, who are a lot more knowledgeable than you or I draw the same conclusions. Bottom line is this, there are certain cities that are still "Union Towns", and their membership is dwindling. Unions should be, and are becoming a thing of the past. They are losing more influence every year, and in the forseeable future will be even less helpful to the working man, because they'll be drawing dues, and not gaining the work anything at all. Nobody wants to deal with their bullshit anymore. The only advantage on the employer's side is that in theory, you should be getting the most skilled worker for the job, but for instance right now, since I'm forced to hire Union Workers, per my company's contract with the State (for this job), and Construction is booming, the most skilled worker is already on another job, and all that's left are dip shits.

Andrew said...

So the alternative is what? Let corporations decide what is best for the employee? No, that would obviously end up with sweatshops across the planet. The government could stand up and enforce better conditions for workers but that isn’t really going to happen because then the politicians wouldn’t get the monetary support of big business. So we are left with no alternative, other than a union run by the people to take care of the workers. Of course there are drawbacks to it, and there is an abundance of unnecessary bureaucracy at the confluence of the unions and businesses, but I can’t see an alternative to it (other than democratically run business cooperatives). Right now the unions have failed the people and are pushing too hard on some initiatives that are unrealistic, but I still can’t see an alternative to the idea of unions that will make sure workers have sufficient rights.

Highly skilled people are easily able to find work, such as yourself, but for the newer, less skilled carpenters, struggling to make rent, then I am sure they are happy that a union was around to help them get some work. Of course having a carpenter come in to nail some cedar boards together for you when you could do it in 30 minutes by yourself seems ridiculous, but to them it might be another dollar to help get food in their kid’s mouth. In your case probably not, but you see my point?

I also see your point, however, that multiple unions together are inhibiting efficient work and forcing too strict of regulations on how the business treats employees, which therefore hurts the business, which is no good either. I don’t know of a work around for that though. Possibly stronger legislation could be created to limit the formation of unions as well as set up more laws governing how the unions are able to operate? I really don’t know.

All this is a little off topic though being that in France the protests do not have anything to do with unions but rather the government (my proclivity for unions forced me to throw them into the post–probably just as a superfluous way to spur discussion).

jerems said...

I don't have a good answer either. I am "management", but I care about worker's rights. The part that gets me is when Unions start to drive away work, helping nobody, because they are idiots. The worker isn't helped very much when his representatives drive away the very work he is there to do in the first place.

The protests in France have everything to do with the Unions. They are a major driving force behind the protests. It started out with college students, but it's fully backed by the unions now. They see this whole thing as an infringement on worker's rights in general. If they change the rules for young workers, they might change them for all. I just don't agree that the workers in this instance are really losing any rights. I look at it as they are being expected to do more, and they aren't going to be able to keep their jobs when they fail to be productive. One of the tenets of American Unions is that if you're not doing your job, you get fired on the spot. Doesn't surprise me that the French got it wrong.