For the last couple of weeks, the nation of France has been shaken by increasingly violent riots, while today (March 27) it faces a national strike by its citizens. What’s the big hullabaloo about, anyway? What’s remarkable about it is that the rioting has been motivated by a proposed change in the law that would make it less difficult to fire young workers, 26 years of age or less, in their first two years of employment. The French have considered the change such an affront to their national identity that people are taking to the streets in violent protest. Obviously the right to just cause before termination is not nearly as dearly cherished in the United States, since in every state but one, it isn’t a right at all. The French riots do make you wonder whether the American public will ever rally against unfair terminations on a national scale to the same extent the French are currently up in arms.
France has an unemployment problem: the national average is 9.7%, nearly double what it is here in the U.S., and among young workers, it is 22%. (See Bloomberg article.) In some poorer suburbs, where rioting took place last November, the youth unemployment rate is nearly 50%. (See San Francisco Chronicle article.) French Prime Minister Dominique de Villepin therefore proposed as a potential solution changing the country’s labor laws to enable a “First Job Contract.” (CPE)
The First Job Contract (CPE) is supposed to encourage firms to hire more young people by lowering the job protection they would otherwise enjoy under French law. It would allow companies with over 20 employees to fire a worker under 26 years old within the first two years without giving a reason. Once workers stay with the job for two years, they would then switch to a long-term contract with much stronger protection against firing. Workers who lose their jobs within the first two years are not completely without protection: they would receive from their employers eight percent of the salary earned since the beginning of the contract, while the company is also required to contribute a further two percent to organizations that will help the workers find a new job. (See CNN article.)
In contrast, all French workers now have strong protections against termination, known as “licensement.” French workers, after a maximum six-month trial period, have what is known as a CDI (contract of indeterminate duration). (See CNN article.) According to a New York Times article, there are essentially four ways to let workers go once they have a CDI, but all are much more time-consuming and costly than what we are used to here in the United States.
1. Economic Reasons: A worker can be let go for economic reasons, but the company must prove in court that eliminating the position is necessary either because of economic woes or because it is essential to remain competitive. Employers must also show that the worker can’t be transferred to another job, and that they used objective criteria in selecting one employee over another in the same position. If the company has more than 50 employees and wants to fire more than 10, it must create a “social plan” that includes efforts to minimize dismissals and provide for job training or other support for employees who are cut. To utilize this procedure, employers must first summon the workers to a preliminary meeting to warn them that they may lose their jobs. Then they must send a registered letter telling a worker he or she is fired, listing the reasons and explaining the efforts that were made to find him another position in the company and detailing the support he will receive later on — usually a training program. If the procedure is not followed, employees may be entitled to damages.
2. Performance: French workers can be fired for doing their jobs badly, but the company has to be able to prove in court that the grounds are real and serious. Defense lawyers claim that the courts are inclined to favor employees when it comes to the reasons supplied for termination. “For a salesman, for example, you have to demonstrate that his performance is not due to a bad product or market,” said Joël Grangé, a lawyer for the Paris firm Gide Loyrette Nouel. “Judges ask for evidence that is very difficult to gather. They say, ‘When you say he’s a poor performer, are you sure it isn’t due to a lack of organization in your company?’ That’s a very difficult thing to show.” A novel concept for Americans: Instead of offering a “legitimate business reason” for termination which in most cases will carry the day, the employer’s own practices and contribution to the employee’s failure is also examined.
3. Settlement: Like in the U.S., most cases brought by fired workers are settled, as it may take years to try a case. Unlike the U.S., however, settlements are exempt from taxes, so it is usually in both sides’ financial interest to go through the legal process rather than paying the employee directly to resign. Settlements often include payment for a notice period, or the time between notification and actual termination, during which employees continue to draw a salary 2-3 months for blue collar workers, or as long as 6 months for white collar employees. Settlements can also include several months’ salary to pay for job training, a severance payment that is determined by how long employees have worked for the company and which industry they are in, and damages, which can be just a few months’ salary for a young person who has worked at a company less than two years up to several years’ salary for someone nearing retirement with many years of service.
4. Put Them In the Cupboard: Here we call it “constructive termination,” which is doing everything you can to force an employee’s resignation without saying the magic words, “You’re fired.” In France, they have a phrase for it which translates to “put them in the cupboard,” which usually means moving them out of the way and leaving them alone in hopes that they eventually quit. That can be expensive too, as employees continue to draw a salary as long as they show up and don’t give the company cause to fire them. And workers who have been set aside with nothing to do can ask the court to declare that they have been effectively fired without due process and then can claim damages. Workers who have been constructively terminated here can do that too, but only if they were fired for illegal reasons. (See our site’s “Leaving Your Job” page for further information.)
So those are the protections that young workers are facing tear gas and riot police to maintain. Not that we’re condoning violence, mind you, but it is pretty impressive that these rights are held so dearly that students are fighting in the streets to maintain them. Since Montana is the only U.S. state where employers are required to have just cause to fire an employee, it’s hard to imagine what effort it would take to get such laws passed, much less to maintain them. (See our site’s Classifications page for further information.)
One of the founding principles of our allied organization, the National Employment Lawyers Association, is to support the ultimate passage of just cause legislation. Each year, at the NELA Convention, attendees can purchase t-shirts proclaiming the “Just Cause Conspiracy.” NELA members — or anyone else for that matter — haven’t been flocking to the streets to start riots: it’s not a criminal conspiracy. Even if they did, it’s unclear who would join them, as most employees aren’t aware of their lack of job protections, and are often very surprised and dismayed to learn that in many cases, there aren’t any remedies available to terminated employees.
If American workers were as acutely aware of their lack of job protections as young workers in France seem to be, would they take to the streets? Or would they blithely accept the rationale that our unemployment rate would be as high as in France if we instituted similar protections? (The French people don’t seem to be listening to that, by the way: recent polls indicate nearly three-quarters want the proposed law changed or withdrawn.) It’s not a surprise that some American newspapers — even the New York Times — are buying that one, calling the riots a “a knee-jerk defense of the job security that the French, or at least those who have a job, hold sacred.” (See New York Times editorial.) Perhaps one day Americans will have some job security they can hold sacred, but don’t hold your breath. At least not until you’re ready to rumble.