Thursday, August 2, 2007

Nullification in Poitou-Charentes?

Connoisseurs of American history will recall the doctrine of "nullification," proposed (anonymously) by that great exponent of states' rights and the South's "peculiar system," John Calhoun, according to whom each state had the power to nullify any federal law it did not like. Something like nullification seems to be emerging in France, as local courts and regional governments try to prevent the application of the Contrat Nouvel Embauche, which was adopted in August 2005.

Ségolène Royal's region Poitou-Charentes is the latest to get into the act. The region had decided not to award regional subsidies to firms availing themselves of the CNE.* The prefect protested, on the grounds that the law had been passed by the Parlement, duly promulgated, and approved by the Conseil d'Etat. The region went to court, and the Administrative Tribunal of Poitiers ruled in its favor.

The region's rationale for opposing the CNE is that it allows employers too much flexibility in firing workers without cause during the first two years of employment. It had been hoped that this provision would encourage smaller firms to take a chance on less-credentialed employees by reducing the cost of giving them a try-out. Whether it did much to encourage job creation is open to question, but certainly the increasingly confused judicial status of the law is not likely to increase the incentive of employers to make use of it.

* The CNE should not be confused with the CPE, which sparked massive demonstrations before it was "passed but not promulgated" in 2006. The CNE drew little attention when it was passed, but in retrospect it has taken on symbolic value as a convenient CPE-substitute. Opposition to the CNE thus accrues moral credit derived from the anti-CPE demonstrations, which are supposed to represent the "will of the people" to reject "precarious employment." The merits or demerits of the measure as such take a back seat to its symbolic value.

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