In setting out his presidential agenda, Nicolas Sarkozy committed to a single employment contract which would take the place of the current ongoing (CDI) and fixed-term (CDD) contracts. This project, also included in the UMP’s agenda, was mentioned in the background document sent by the French Prime Minister to social partners prior to their meeting of 19 June 2007, as well as in his general policy speech of 3 July 2007. “Wouldn’t it be a better idea,” asked Philippe Baccou — a high-ranking government official and ENA graduate — “to give social partners much more freedom?”In his paper on the single employment contract, Philippe Baccou interpreted the 2006 observations made by the Conseil d’orientation sur l’emploi (COE) [French employment counselling and advisory board] which argued the single employment contract would not meet the objective set: that is, to eliminate the difficulties engendered by the employment contract rules in force.
Replacing the fixed-term and ongoing contracts does not address the main flaw in the French system: the conditions for terminating the CDI discourage hiring and promote a climate of distrust between employers and employees. A better approach would be to simplify the complex rules applying to CDIs, which would be difficult to achieve without offering compensation in terms of better protection for individuals (higher unemployment benefits, better job placement support).
The single employment contract would require radical changes. The French Labour Code could authorize a longer trial period, which is set by French law at 12 months (thereby making it compatible with ILO Convention 158), alleviate the economic lay-off procedure and limit the financial costs of dismissal in the event of a dispute.
As an alternative to these reforms, and breaking with the “job protection at any price” dogma, the author suggests that better individual protection could be achieved through the unemployment insurance system, provided that unemployment benefits induce the recipient to quickly find a new job (the benefit paid should be higher at first, and decline faster over time) and that the administration cease to distinguish (other than in the 4 or 5% of cases requiring specific social assistance) between employable job applicants and those for whom going back to work is more difficult.