Since about three months now economic activity in France has been virtually paralysed by protests and demonstrations led by students and labour unions, a feature reminiscent of the famous May 68 movements.
These massive protests primarily against the proposal for reform of labour laws presented by a “socialist” government but fully backed by, some would say originating from, the Employer’s Federation of France (MEDEF) have led some observers to state that France has probably reached a “point of no-return” and hence become literally a country which cannot be reformed. This is certainly an exaggeration.
The main issues with the aptly contested law revolve around the fact that it is intended to lift the legal constraints on the sacking of workers by employers, which the government says will create an incentive to hire more. The new labour law also provides for negotiations for wages and other working conditions between employers and employees at firm level instead of the actual practice of national negotiations led by the unions.
There are admittedly what one could characterize as some peculiar traits of the French people and institutions, including among its student movements, the labour unions and mainstream political parties which are, as they would say, “inédits” or unique to the country. Prominent among those is the absolute disposition to resist whatever looks like challenging the “acquis sociaux” which have been won at great cost by the working classes during decades. How all this will work out finally is hard to figure out, although there have been some concessions made by the protagonists over the past week to allow at least the start of serious negotiations.
These events hold many lessons for a country like Mauritius, which shares with France the fact that the “welfare state” is fully ingrained in the national consciousness as a result of historical and cultural attributes.
The issue of centralized tripartite negotiations for wages and salaries, for example, is deeply embedded in a form of corporatism, which has been the dominant governance structure at the national level ever since the country acceded to independence. This form of corporatism consists primarily of a tradition of Public-Private Partnership, which was embedded in the successful negotiations for ensuring favourable access to our sugar production in the EU through the now defunct Sugar Protocol.
Added to this is a high dose of tripartite consultations – in which the unions are brought on board. There have been attempts for some time now to challenge the holding of the “annual tripartite negotiations” with the employers batting for “sectoral” negotiations while the unions firmly stick to the status quo. The government, independently of which parties or alliance is in power, has been mostly ambivalent. Under the last government there was a definite tendency to “liberalize” labour laws within a package of measures dubbed as “structural reforms”.
The dominant Neo-Liberal ideology globally is premised on the belief that State intervention in the economic sphere is necessarily detrimental to the economic welfare of a nation, independently of the specific social and historical circumstances prevailing in the country. It forms part of the one-size-fits-all solutions, which have been promoted by the supporters of the unfettered capitalism propaganda. In its essentially technocratic formulation “high protection for employees” (i.e. rules and institutions that make it difficult for employers to fire or sack workers) shelters low-productivity workers from competition with high-productivity workers.
The difficulty with this type of argument is precisely their “technocratic” bias in which human beings are treated as mere factors of production which can be used and displaced in order to achieve profit maximization for the firm and increased shareholder value.
To illustrate our argument, it may be pointed out that in the United States, for example, this kind of reasoning is more “acceptable” to the people at large because it reflects the dominant national ethos of individualism inherited from the pioneering spirit of the founders of the country. This does not mean that it does not result in untold miseries for the most vulnerable sections of society.
In a country like France, on the other hand – and we believe that the Mauritius experience is more akin to the French situation – the historical and social conditions militate against such treatment of the working classes and other vulnerable sections of society.
Under the circumstances, the abusive reduction of worker protection – which looks to economists like the perfect equation to bring about increased national competitiveness – shall in fact result in the emergence of a hostile and permanently conflictual environment which proves to be counterproductive to the desired objectives.
What is happening in France today is the perfect illustration of such a situation. In Mauritius the trade union movement has been rather weakened during the past decades for a number of reasons, which we shall not consider here. There is less likeliness of mass protests but there is no doubt that in the face of similar onslaughts on worker protection rights there are insidious forms of protests which may be less visible but certainly not less harmful to productivity.
Having said all of the above, this is not meant to be making a case for sticking to the status quo in a rapidly changing global and local environment. It is rather meant to be a call for processes of negotiations and conflict resolutions which are more appropriate to the local conditions.
History cannot be simply wiped out; even radical changes need to start with a good understanding of the prevailing conditions in order to achieve their objectives while mitigating the unintended consequences. Jumpstarting our admittedly staid corporatist model into a more dynamic and productive one, which builds on its solid foundations, is in fact a badly needed change, which is long overdue. Adapting the right process is the key to a successful outcome.
* Published in print edition on 10 June 2016