For years, employees of the French company EDF have enjoyed a perk almost inconceivable to their counterparts in the rest of the industrialised world: 10 weeks' holiday leave a year.

Now the state-owned energy utility is trying to call time on the arrangement, in a move that reflects the French state’s increasing willingness to loosen the rigidities of its labour market.

Compensated

The 10 weeks of holiday leave enjoyed by about 30,000 of EDF's white-collar employees were negotiated in 1999, as France moved to a statutory 35-hour working week. Because EDF staff work an average of 39.5 hours per week, four-and-a-half more than the 35-hour legal limit, they were compensated with what amounts to an additional 23 days off a year, on top of 27 days of conventional holiday.

Jean-Bernard Lévy, EDF chief executive, is offering employees a one-off €10,000 payment to persuade them to work 212 days a year, rather than the current 196. Executives, who earn an average €51,600 a year, can also opt for a pay rise of 4-6 per cent.

"We are no longer in the same market as in 1999," wrote Philippe Torrion, the group strategy director, in a message to employees this month. "It is also a question of credibility. We cannot be out of step with the world."

EDF's move highlights France's desire to challenge the framework of the 35-hour week at a time when the government of President François Hollande is pursuing more business-friendly economic policies. The 35-hour law was introduced by Socialist prime minister Lionel Jospin in 1998, with the aim of creating more jobs, but it has since become a symbol of the inflexibility of France's labour market.

Working hours

The government is also looking at changing the working hours of about 75,000 employees in 38 public hospitals. "We are seeing attempts to renegotiate the working hours on a case-by-case basis," said Denis Ferrand, head of COE-Rexecode, a Paris-based economic think-tank.

However, EDF’s reform initiative has run into opposition. The company’s CFDT union argues that EDF should pay €80,000, not €10,000, to every worker in exchange for signing a new contract that in effect entails working an extra three weeks annually. – Copyright The Financial Times Limited