/ 22 March 2005

France dismantles ”les 35 heures”

Sophie Guilbaud not only holds down a decent job, she also finds time to help run her son’s nursery and treat herself to regular weekdays of shopping, movies and art shows.

The secret to her balancing act is a remarkable piece of social engineering — France’s 35-hour working week. Introduced under the Socialists but headed for effective abolition by lawmakers on Tuesday, ”les 35 heures” have been a boon for some but, critics argue, a big drain on the economy.

Heated debate over dismantling the working time law has fed into wider political and literary soul-searching in France, on themes ranging from the country’s economic frailty and bureaucratic office culture to whether quality of life should be measured in time or money.

For Guilbaud, a Parisian, that last question is a no-brainer.

”Work is not the only thing in my life,” she said.

With unemployment at 10%, politicians of all stripes acknowledge that the 35-hour law has failed in its original ambition: to force employers to hire massively. What’s more, there are strong signs that it has held back living standards — measured the monetary way — as employers froze salaries to make up for lost labour.

”The intention was to spread work around, but the effect was to spread our salaries around,” said Thierry Breton, France’s new finance minister, in his first major news conference on policy last week.

Lawmakers are about to hold the final vote on a government-backed Bill allowing companies to negotiate new contracts requiring staff to work up to an additional 220 hours a year — effectively restoring the previous 39-hour workweek.

The conservative-dominated Parliament approved the reform by 370 votes to 180 in its first reading, almost three years after the general election that ousted the Socialists from power.

President Jacques Chirac’s government has sold the plan as a chance to ”Work More to Earn More.” In practice, though, only the lucky few will get to pick their schedules individually. Companies are far more likely to negotiate uniform deals on pay and conditions, which are easier and cheaper to manage.

Guilbaud is determined to hold onto her newfound lifestyle and suggests she would consider leaving her job as a loan company manager rather than work longer hours.

Besides her six weeks of annual vacation, she puts in a half-day every two weeks at her two-year-old son’s nursery, which is managed and staffed by parents. That still leaves occasional weekdays free for shopping, movies and exhibitions. ”I don’t want to go back,” she said. ”It’s about quality of life and seeing more of your children.”

Childcare is less of an issue for Clara Gaymard, in spite of her high-powered job as globe-trotting head of the French International Investment Agency. Herve Gaymard, her husband, vowed to spend more time with their eight children when he resigned as finance minister last month in a scandal over his lavish publicly funded apartment.

Clara Gaymard believes the 35-hour week has damaged investment in France, mainly because of its negative image in countries like the United States — France’s biggest source of investment — rather than the economic reality.

”The perception was that the French didn’t want to work any more,” she said, whereas French workers remain among the most productive in the world, ahead of Britain, Germany, the United States and Japan, according to the European Union statistics agency Eurostat.

”I heard from some investors that they thought there were policemen behind everybody, making sure they don’t do more than 35 hours every week,” she said. Few understood that the 35-hour law set an annual average, not a strict weekly limit, she said.

Even free-market champions like Marc Touati, chief economist at Paris-based Natexis Banques Populaires, concede it had an upside, allowing large companies to negotiate more flexible staff contracts and offer better services to customers.

Banks opened on Saturdays and manufacturers sent workers on holiday during seasonal lulls in production, Touati said. ”It also created some jobs at the beginning because there were tax breaks and because companies were enjoying strong growth.”

In today’s uncertain economic environment, though, the shorter workweek is ”destroying jobs because companies wonder whether it’s worth taking people on for just 35 hours a week,” Touati said.

According to a 2003 OECD survey of 25 industrialised countries, only Norwegian and Dutch employees worked less time each year than the French, who worked an average 1 431 hours. German workers put in 1 446 hours, British 1 673 hours, Americans 1 792 hours and Koreans 2 390 hours.

Last year, a parliamentary committee reported that the 35-hour week cost the state more than â,¬10-billion a year, also casting doubt on a labour ministry study that suggested it had created 350 000 jobs between 1998 and 2002.

Most French workers, like Guilbaud, are loath to give up their shorter hours, even for more cash. About 56% of salaried employees oppose the government’s plan, according to a survey by pollsters CSA published last month, while 36% approve.

On March 10, almost a million people took part in strikes and protests over the working time reform — as well as other threats to workers’ benefits and public sector pay. Former Socialist minister Martine Aubry, who drafted the original 35-hour law, has accused the government of ”trying to turn the clock back 40 years”.

But Nicolas Sarkozy, who pushed hard for the law to be loosened while serving as finance minister last year, was unrepentant.

”It’s wonderful to see so many people marching to defend the jobs they already have, pushing aside so many others who would also like the chance to have a job,” said Sarkozy, who leads Chirac’s governing Union for a Popular Movement party and is looking to run for president in 2007.

Chirac’s rival had found a raw nerve. With unemployment soaring and wages stagnating, the reform is in fact supported by jobseekers and even by factory workers, according to the CSA poll — and by 46% of the overall population, with 43% opposed.

There are other signs that the vision of a leisure society expounded by former Prime Minister Lionel Jospin’s Socialists now rings hollow in some surprisingly left-wing constituencies.

Often touted as the working mother’s godsend, the 35-hour week actually made life harder for poorer women and single parents, according to women’s organisation Clef, which says the law benefited only affluent women.

”The women that suffered were the lowest paid, who needed all the overtime they could get to make ends meet,” said CLEF president Monique Halpern. ”I think this is one of the reasons that Lionel Jospin lost the elections.” – Sapa-AP