France’s New Retirement Law: What Does This Mean?

French President Emmanuel Macron was very determined to adopt his controversial retirement reform, despite the last 3 months of protests and strikes. The reform will increase the retirement age by two years from 62 to 64 by 2030 and require people to work for 43 years to receive full pension. It will also put an end to most “special regimes” which are sector-specific deals that allow workers to retire before 62. This reform is highly discriminatory against those in special regimes, as they are people with physically exhausting jobs, such as workers in the electricity and gas industries, public transports, etc., but they will also now have to work until 64. Women are also the principal victims of the new reform. Women in France currently earn lower salaries than men on average, and they are more likely to work part-time or take time off from work to care for children or elderly relatives. This can result in lower pension benefits for women. Under the proposed reform, pension benefits would be calculated based on an individual's earnings over their entire career, rather than just their highest-paid years. This could disadvantage women who have taken time off from work or worked part-time, as their lifetime earnings would be lower than those of men who have worked full-time throughout their careers.

After Macron invoked article 49.3 of the constitution to impose the reform without a vote in parliament, 3,5 million French demonstrators on March 23, saw his attitude as a “political suicide and abuse of power” . The two no-confidence motions in parliament were the last alternative to prevent the bill from passing, but the majority vote wasn’t obtained so the new reform became law and has been validated on Saturday April 15 by the Constitutional Council. It means Macron won his gamble, but at what cost? 

On Monday April 17, Macron finally broke the silence and addressed the nation in a public appearance. He opened his speech by saying “Is this reform accepted? Obviously not. Despite months of talks, a consensus wasn't found, and I regret that”. He said that this reform was the only option due to the aging population as the pension system would run a deficit in the coming years with too many retired people and not enough working people. The other options suggested by the protestors, such as lowering pension payment or raising taxes, weren’t possible according to Macron. This retirement reform was necessary to stay an “independent” nation. Macron continued his speech by stating that he’s open to negotiate with unions on working conditions, “increase employees’ salaries, improve careers and a better repartition of the wealth”. He also gave a roadmap of what he wants the government to work on in the coming years such as ecology, increasing police, education, and healthcare.  

According to Laurent Berger, the head of CFDT which is France’s largest union, Macron’s speech  was “empty” and lacked empathy by failing to address the anger in the country. Laurent Berger argued that Macron’s proposal to negotiate worker’s conditions with unions is hypocritical because he refused to negotiate with them for the last three months,imposing his reform without their input. If negotiations do happen, Laurent Berger states that unions will make sure that it will be true negotiations and not the government imposing its will once again. Similarly, Sophie Binet, the head of the CGT, another major trade union in France, argues that Macron wants a fresh start after the reform and forgets that the French people are still unhappy with the bill itself and the way it was imposed. Macron had 15 days to implement the reform after being validated by the Constitutional Council. Instead of using that time to negotiate with unions, Macron rushed to make the reform become law in one day. Sophie Binet predicts that the fight is not over: the relationship between the unions and the executive will not improve until Macron removes his new retirement law.