The French parliament passed a law yesterday that will allow companies to bypass compulsory 35-hour working week limits, effectively burying one of the flagship reforms of the former Socialist government.
President Nicolas Sarkozy has repeatedly slammed the 35-hour week as one of the biggest factors hampering France's economic competitiveness and he has chipped away at it since coming to power in 2007.
But he has shied away from scrapping it altogether, aware of its popularity among French workers and conscious as well of the boost to consumer purchasing power of overtime work, which is not subject to income tax after an earlier reform last year.
The law, which also includes measures aimed at ensuring that unions are more representative, will permit firms to set individual deals with unions over working hours and overtime.
Final approval, which follows the Senate's approval of a separate package of measures reforming small business and the retail sector, came late on Wednesday and the new measures are set to come into force at the end of August.
The 35-hour working week, introduced by former Socialist Prime Minister Lionel Jospin a decade ago, has been very popular with French workers, Europe's champion holidaymakers with 37 days of paid leave a year, compared with 27 in Germany.
Supporters say it has allowed a better balance between work and home life and deny it has held back productivity. But for the centre-right government, the rules have become a symbol of the need to reform the French economy.