Paris: French Prime Minister Manuel Valls on Tuesday unveiled a battery of measures to encourage small businesses to take on more staff in a bid to chip away at the country`s dismal unemployment figures.
Softened labour laws and a bonus for hiring their first employee are meant to encourage small and medium-sized enterprises by "lifting obstacles, uncertainties, simplifying life," Valls announced after a cabinet meeting.
Jobless lines have grown longer under President Francois Hollande, who has pledged not to seek a second term in office in 2017 if he fails to reverse the upward trend in unemployment which stands at 10 percent.
The "Small Business Act" will grant a bonus of 4,000 euros ($4,500) to businesses who currently have no employees (there are 1.2 million in France) and who hire their first worker for a year-long contract.
France`s stiff labour laws often dissuade employers from taking on staff as they fear they won`t be able to fire them.
To ease these concerns the government is seeking to put a limit to the damages that can be awarded to a staff member found to have been fired unfairly.
Valls said this measure did not apply to large companies or "serious labour law abuses" like discrimination or harassment.
Short-term contracts -- which have very strict rules for employers to encourage them to take staff on permanently -- can now be renewed twice instead of only once.
However the maximum time someone can be employed as a temporary staff member remains 18 months.
The government also suspended a number of the additional obligations that small businesses face when they add employees.
For Christian Person, CEO of French consultancy firm Umalis, these measures "couldn`t come soon enough."
"It is the essential flexibility that our small businesses require to adapt to an increasingly competitive global economic environment," he said in a statement.
He said government had "procrastinated" for too long, but welcomed the move which would "allow us to overcome the fear of hiring."