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"But they couldn’t fire most of them. The workers were state employees — employees for life — and therefore protected." I hear the first time about a practice

"But they couldn’t fire most of them. The workers were state employees — employees for life — and therefore protected." I hear the first time about a practice like this on that scale... (besides communism, but that's not France) I know that academic tenure works like that, some union management people have this type of protection, data protection officers, maybe some other special professions that have a conflict of interest with their employer; But who in their right mind would hire 20 000 employees (or 130 000?) without a way to fire them? What if a company simply does not have work for them? Should the company invent work for them that is economically not rational? What if the company goes bankrupt and instead of 20 000 people losing their job, 130 000 will lose their job? Is France somehow guaranteeing that France Telecom will not go bankrupt no matter how much looses and dept they generate? Could someone explain this concept to me? I genuinely don't understand how this was/is supposed to work.

lmm 7y ago
Hiring a person is seen as a big commitment. You're asking that person to uproot their life for you (e.g. they might well move home to be in the right place to do your job), they expect a similar commitment from you in return (one could draw an analogy to e.g. marriage). You don't just drop them at the first sign of trouble: you can fire for cause if the employee is actually doing something wrong, but as long as they keep working and you stay in business you're expected to keep paying them. So yes, that might mean keeping them on doing work that they're overqualified for, or where another company in the market might have a better use for their time, or in the worst case continuing to pay them when there's simply no work for them to do. (Though in practice you'd probably negotiate e.g. an early retirement package in that case). It's a nicer way to live, not having to fear that you might be kicked to the curb at any given month. No doubt it comes at a cost to economic growth, but it's important to remember that the economy exists to improve human lives, not the other way round.
- Isinlor 7y ago
  So what happens if a company goes bankrupt? It's a big catastrophe to have to fire 20 000 people, but if that means keeping 110 000 people employed, the decision would seem straightforward to me. How do companies avoid bankruptcy in this type of situation? BTW - My parents and grandparents lived through communism, with not only guaranteed, but enforced full employment, but they would argue that it was not a nicer way to live.
  - lmm 7y ago
    > So what happens if a company goes bankrupt? > It's a big catastrophe to have to fire 20 000 people, but if that means keeping 110 000 people employed, the decision would seem straightforward to me. The government has a history of intervening to prevent that kind of big bankruptcy. But ultimately, if the company does go down it goes down together - better that than for those at the top to keep paying themselves while claiming they can't afford to pay others. > BTW - My parents and grandparents lived through communism, with not only guaranteed, but enforced full employment, but they would argue that it was not a nicer way to live. Perhaps both extremes are bad. France does well in polls of life satisfaction and the like, and those results align with my experience. Shrug.
Cynddl 7y ago
In France, such contracts do not imply that a company cannot fire employees. Contracts can be terminated for economical reason, which however needs to be justified. If your company is working well, should you be able to downsize and fire employees without a clear motive? To a certain degree, France believes the answer is no.
- Isinlor 7y ago
  What you write makes sense, or is at least reasonable to a point where I can believe that people genuinely think so. But my question is then, why the company did not argue that they need to fire these 22 000 workers without resorting to shady methods? "Company executives thought they needed to get rid of 22,000 workers out of 130,000 — a necessity contested by the prosecution — to ensure survival." Was there some additional cost to triggering mechanism you describe?
  - stzup7 7y ago
    Yes indeed, it's a cost issue. Typically when you want to fire people for financial reason you need to start talking with unions, explain them the situation, decide how many people you need to fire and how big the severance package should be. On the other hand if an employee resigns, it's free. For a time, big French corporations were known for their aggressive methods, putting employees in empty rooms with no computers and no work to do to "force" them to resign.

lmm 7y ago

Hiring a person is seen as a big commitment. You're asking that person to uproot their life for you (e.g. they might well move home to be in the right place to do your job), they expect a similar commitment from you in return (one could draw an analogy to e.g. marriage). You don't just drop them at the first sign of trouble: you can fire for cause if the employee is actually doing something wrong, but as long as they keep working and you stay in business you're expected to keep paying them. So yes, that might mean keeping them on doing work that they're overqualified for, or where another company in the market might have a better use for their time, or in the worst case continuing to pay them when there's simply no work for them to do. (Though in practice you'd probably negotiate e.g. an early retirement package in that case). It's a nicer way to live, not having to fear that you might be kicked to the curb at any given month. No doubt it comes at a cost to economic growth, but it's important to remember that the economy exists to improve human lives, not the other way round.

Isinlor 7y ago
So what happens if a company goes bankrupt? It's a big catastrophe to have to fire 20 000 people, but if that means keeping 110 000 people employed, the decision would seem straightforward to me. How do companies avoid bankruptcy in this type of situation? BTW - My parents and grandparents lived through communism, with not only guaranteed, but enforced full employment, but they would argue that it was not a nicer way to live.
- lmm 7y ago
  > So what happens if a company goes bankrupt? > It's a big catastrophe to have to fire 20 000 people, but if that means keeping 110 000 people employed, the decision would seem straightforward to me. The government has a history of intervening to prevent that kind of big bankruptcy. But ultimately, if the company does go down it goes down together - better that than for those at the top to keep paying themselves while claiming they can't afford to pay others. > BTW - My parents and grandparents lived through communism, with not only guaranteed, but enforced full employment, but they would argue that it was not a nicer way to live. Perhaps both extremes are bad. France does well in polls of life satisfaction and the like, and those results align with my experience. Shrug.

Cynddl 7y ago

In France, such contracts do not imply that a company cannot fire employees. Contracts can be terminated for economical reason, which however needs to be justified. If your company is working well, should you be able to downsize and fire employees without a clear motive? To a certain degree, France believes the answer is no.

Isinlor 7y ago
What you write makes sense, or is at least reasonable to a point where I can believe that people genuinely think so. But my question is then, why the company did not argue that they need to fire these 22 000 workers without resorting to shady methods? "Company executives thought they needed to get rid of 22,000 workers out of 130,000 — a necessity contested by the prosecution — to ensure survival." Was there some additional cost to triggering mechanism you describe?
- stzup7 7y ago
  Yes indeed, it's a cost issue. Typically when you want to fire people for financial reason you need to start talking with unions, explain them the situation, decide how many people you need to fire and how big the severance package should be. On the other hand if an employee resigns, it's free. For a time, big French corporations were known for their aggressive methods, putting employees in empty rooms with no computers and no work to do to "force" them to resign.