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Pain and gain of a 35-hour week

By Nick Easen for CNN

Economic and labor reforms are meeting strong opposition in France.

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(CNN) -- The struggle to achieve a work-leisure balance is one of the biggest challenges of modern life, but if you live in France you get a little help from the government.

Since 2000, companies with more than 20 employees have enjoyed more leisure time than ever, thanks to the 35-hour working week.

Yet the full impact of the initiative -- economically and socially -- has yet to be fully understood.

Some in industry and government have nothing but praise for the four-year-old legislation, which cut the working week by four hours; others say it has cost France dearly.

"You obtain much better results when people are relaxed and in good shape, rather than being tense -- by working less you generally work better," Thierry Monfort, CEO of Laboratoires Boiron near Lyon told CNN.

The homeopathy company claims to have maintained both salaries and productivity, although not everyone is happy about the shorter working week.

"We have been forced to reduce the number of hours, eventually that is going to affect our bottom line," says Giles Le Lamer CEO of Electrovision, a lighting and disco company.

The law was introduced by left-wing former Prime Minister Lionel Jospin in the hope it would bring more jobs, as well as extra leisure time.

Yet France still has one of the lowest employment rates in Europe, with just over 60 percent of the active population in work, compared to 65 percent in Germany and 73 percent in Britain.

Current Labor Minister Francois Fillon has tried watering down the law by raising the legal limit on overtime.

But economic reforms have deeply divided France, chipped away at the conservative government's popularity and sparked protests.

Just this week, voters delivered a devastating verdict on President Jacques Chirac's government and its reform program when opposition Socialists won nearly all of France's 26 regions.

The pain

Budget Minister Alain Lambert sparked controversy last year, saying the law was costing 15 billion euros a year and that France's public deficit would probably have remained below the EU cap if the law had not been passed.

The Organization for Economic Co-operation and Development (OECD) also estimates that the 35-hour week costs the government eight to 10 billion euros per year.

"On balance there has been some small increase in productivity that can probably be attributed to the (shorter) week," says John Martin of the OECD.

"It is quite clear that the increase in productivity is not large enough to offset the full cost of the 35-hour week."

The gain

According to the Work Foundation, a charity that advises companies on flexible working, there is no evidence to prove that longer hours bring about productivity gains.

"It is about how you organize your work. It is about working smarter rather than harder," says Alexandra Jones, of the Work Foundation.

"So actually associating the two is a mistake and it is shown by France's productivity."

One thing that is clear, a change in the law is unlikely anytime soon.

"If I told my employees "we are going to do what we did three years ago, instead of working less for the same salary, you will work more for the same salary" -- then, they would take to the streets," says Le Lamer.

Already more German companies are considering allowing employees to work longer than the standard 35-hour week, following carmaker DaimlerChrysler's example.

Yet many in France worry that the government's reform agenda could undermine their way of life by changing it into a more Anglo-American, capitalist society.

CNN's Paula Sailes contributed to this report

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