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ORIGINAL FRENCH ARTICLE: Salaires de rien, travail de chien

by Patrick Apel-Muller

Cutting Taxes on Overtime Pay in France: All of the Pain, None of the Gain

Translated Thursday 21 June 2007, by Emma Paulay

"Work more to earn less." The proposed law on the overtime pay tax exemption that the president and the prime minister are preparing is a new take on Nicolas Sarkozy’s campaign slogan. We saw it coming. But they wouldn’t say so. They had to make the voters believe that they were going to cook up a solution that would allow them to improve their quality of life without it being necessary to lay siege to large companies or change a system which is strangling small ones.

Of course, this measure, which was one of the emblems of the president’s campaign, might seem more harmless than the introduction of a minimum medical fee which will mean that a huge majority of low paid employees will have to pay for their medical expenses. Nevertheless, it may have equally disastrous consequences. Three economists, Patrick Artus, Pierre Cahuc and André Sylberger, none of whom are dishevelled revolutionaries and all of whom support the neoliberal system, have provided the French "Economic Analysis Council" with a report that demonstrates this.

The first of this measure’s defects would be to hit the French in their pockets. The experts say “the cost to public finances could be exorbitant”. Consequently, these costs will be offset by public-sector budget reductions, and mean less expenditure, that could have been put to good use on social issues.

The second drawback is that companies are going to prefer to pay overtime because it will cost less than hiring more staff. Overtime already represents 680,000 full-time jobs. This blow to employment figures will be accompanied by increased pressure on workers. Employers will crush the normal level of pay by threatening to introduce overtime, when low salaries are the reason for today’s stagnation in growth.

Finally, this measure will reduce the cost of employment for large companies that already pile up staggering profits and reduce social rights. A large part of overtime already goes unpaid at the moment, so if there is more and more overtime in the future …On top of that, employees can rarely choose their working hours. The employers already make the rules of the game and if Sarkozy’s project goes ahead, they will have an even better deal.

Let us sum up the different elements of the problem before we choose our parliamentary representatives: the French are the most productive employees in the world; our country is also a lowp-wage zone with the majority of monthly wages at less than 1,300 euros; the profits of large companies are climbing through the roof and the dividends paid to shareholders are rapidly becoming sky-high; unemployment, even masked by the numerous lay-offs and an increase in temporary contracts, remains high.

All this will be accentuated by the tax exemption on overtime pay. Should we increase the price to pay by giving Nicolas Sarkozy’s UMP party a crushing victory that would prevent the voice of employees from being heard within the national assembly? Nicolas Sarkozy, in choosing to begin his election campaign in the communist seat of Le Havre, has marked out the course he intends to pursue in his own way.

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