by Caroline Pailliez and Leigh Thomas
OTTMARSHEIM, Haut-Rhin, May 24 (Reuters) – Faced with soaring prices and pressing demands from employees to raise wages, French companies are seeking the right balance to preserve their competitiveness. Fligitter, an Alsatian window manufacturer, achieved this by affecting the rights of its employees.
The company has negotiated with its staff a collective performance agreement (APC) – a controversial tool put in place by Emmanuel Macron’s Labor Code reform in 2017 which allows for greater flexibility in terms of remuneration, working time and employee mobility.
The agreement allowed an increase in employee compensation of 6 to 8% which translated into a 4% increase in costs for the company, according to the head of human resources, Sophia Grandidier.
To do this, it was necessary to reverse acquired rights, by eliminating bonuses, for example, by implementing a lower increase in overtime and severance pay, or even by eliminating days off.
For Hervé Volochinoff, who joined the company a year earlier, these concessions were worth it.
“There is a shortfall on overtime, but I would not have refused the salary increase. Without this increase, I would have difficulty making ends meet,” says the 24-year-old. years, who saw his salary go from 1,450 euros net before the agreement to 1,600 euros net and can now put aside to buy furniture for the apartment where he has just moved.
Like Fligitter, French companies are looking for a parade to deal with inflation, which recorded a record rate of 5.4% in April.
These price increases have resulted in an explosion in the cost of raw materials and have fueled significant demands for wage increases from workers across Europe, making it increasingly difficult to maintain competitiveness.
“DEAD IN THE MEDIUM TERM”
In the Alsatian company, it was above all important to retain employees. Located near Switzerland and Germany, where wages are more attractive, and in a very dynamic employment pool, the 80-person SME founded in 1968 lost six or seven workers each month.
“We could not have increased wages without affecting the structure of remuneration, it was impossible. The factory would have died in the medium term”, explains the president of the family business, Raphaël Fligitter, who says he has to compose with fierce competition from Eastern European countries with much lower production costs.
The measures to maintain purchasing power put in place by the government, and in particular the tariff shield on energy prices, have so far made it possible to contain inflation in France and limit the desire for a salary increase. , explains Gilles Moëc, chief economist of the Axa group.
French inflation is the lowest in the European Union with that of the island of Malta.
The increases negotiated for 2022 in the professional branches are between 2.5 and 3.5%, according to the Banque de France. But many agreements signed in 2022 contain review clauses, which should lead the branches to renegotiate wages outside the usual schedule. The French unions are already calling for all to reopen these negotiations in companies.
Many companies are looking for short-term solutions to increase the remuneration of their staff in the event that prices go down, explains Eric Chevée, vice-president of the employers’ union, CPME.
APCs can be a way to achieve this, but they remain very marginal in the world of work – almost 990 agreements have been signed since their introduction in 2017.
CONCESSIONS
The unions at the national level see especially a very bad eye this device which can support, according to them, a “blackmail with employment”. “The employers often take advantage of the very poor employment situation to say that there is no alternative. It is regrettable,” Boris Plazzi, national secretary of the CGT, told Reuters.
Under the impetus of its employers’ federation Plastalliance, Fligitter proposed to abolish certain bonuses provided for by the professional branch and capped the seniority bonus at five years. It included part of what was lost in the base salary and, at the same time, introduced tax-free and desocialized bonuses.
Fligitter also reduced the overtime premium, significantly reduced severance pay, especially for executives, and eliminated three days of paid vacation for the latter.
This agreement was not imposed. In accordance with the Labor Code, it was submitted for the approval of staff representatives who voted in its favour.
It was rather well perceived among the workers, explains Geoffrey Couvillers, 23, staff representative, who specifies that his colleagues did not expect such an increase in their net salary.
On the executive side, it was necessary to convince more. Jérémy Mosak, project and design office manager, who has worked for the company for 16 years, admits that the proposal raised his eyebrows. But the company made sure to increase his gross salary in compensation.
“I don’t think I was wronged in this story,” he says.
(Report by Caroline Pailliez and Leigh Thomas, edited by Sophie Louet)