Pascal Emmanuel Gobry

Why Macron Doesn't Fear France's Unions

The first street protests against Emmanuel Macron’s proposed labor-market reforms have been underwhelming. Several major unions stayed away. Estimates of the turnout varied -- from 223,000, according to fairly reliable police figures, to 500,000, according to the CGT, France's biggest union, which called for the march. Whatever the real number, French unions are divided, and this helps Macron’s reform efforts.

This is unusual. France's unions are traditionally a united front against pro-market reforms of any kind, especially labor-market reforms. Despite a history of radicalism, Jean-Claude Mailly, secretary general of the Force Ouvriere (FO), has all but endorsed the bill, while criticizing it. The moderate CFDT union, which most observers expect to eventually support the bill, has not yet taken an official stance, saying it is still studying the matter. Meanwhile CFE-CGC, usually a moderate union, has denounced the bill in terms more fitting for a far-left tract. What’s going on?

Some of this is just habitual political squabbling: Mailly, traditionally allied with the bigger, formerly Communist Party-affiliated CGT, is said to be tired of playing second fiddle and is therefore looking for opportunities to distinguish his group from his senior partner. But there are structural factors at play: the fundamental realignment of French unions as they become more responsive to their members’ concerns.

French unions are famously radical and resistant to all reforms. After World War II, French leaders wanted to create a German-style “social market economy” whereby workers would be represented on boards and be key stakeholders in corporate decisions. A system of “representivity” was set up whereby a company, industry sector or government must negotiate labor rules with those unions that the law deems “representative” of the workers concerned. In sector-wide or national negotiations, any proposed reform must meet a certain threshold of approval by unions, and each union’s vote is weighted by its representivity.

The cardinal sin of the post-war system in France is that the law simply set out which unions were deemed “representative,” whatever their results in elections or their membership numbers, thereby giving them a legal lock on the process and freeing them from accountability to their own members and to employees. Most workers, employees and managers don’t actually want to strike and protest over every little thing -- even in France. But unions were not accountable to them, and were not incentivized to cater to them.

Unions therefore became little more than political machines. With no incentive to provide services to workers, most of the people drawn to join them were either ideological radicals or civil servants, because civil service rules incentivize union membership, giving unions the ability to bring the whole country to a halt by triggering strikes in key public services. This led to an oft-noted paradox: France had extremely powerful unions, but also the lowest percentage of union membership of any major economy.

In 2008, a crucial reform changed the rules around representivity for unions so that election results were taken into account in the formula for their representivity. The consequences of this systemic shift have been slow in trickling through the system; participation in union elections slowly increased as everyday employees found out their vote actually matters. In March of this year, an earthquake happened: In professional elections, the centrist and moderate CFDT union came in first, ahead of the radical CGT. It was the first time since World War II that CGT didn’t come in first.

Unions have slowly begun to realize that they cannot represent only their ideological activist base but must also reflect a broader swathe of French workers, lest they become irrelevant. FO, usually a radical union, has been treading a fine line, denouncing the bill in press releases and holding a non-binding vote against it, but also refusing to call for strikes and protests; the union has generally been moving in a more conciliatory direction, voting in favor of a deal with bosses on unemployment insurance in March, for example. It is said to be trying to find a middle way between CFDT’s image as always saying yes to everything, and CGT’s as always saying no.

This alone has significantly altered the landscape. Macron’s labor-market reform is essentially tailor-made to squeak through without too much disruption and to be supported by at least a few unions. It might be a missed opportunity to push more radical reforms, but by capitalizing on the structural changes to the landscape of French unions, all the signs are there for relatively smooth sailing.