Labour Clauses (Public Contracts) Convention, 1949 (No. 94) - France (Ratification: 1951)

Observation (CEACR) - adopted 2021, published 110th ILC session (2022)

Article 2 of the Convention. Inclusion of labour clauses in public contracts. In its previous comments, the Committee requested the Government to continue providing information on any legislative changes that could have an impact, and on the application in practice of the Convention at the national level. The Committee notes the detailed information provided by the Government on developments in public procurement law since 2016, in particular the entry into force on 1 April 2019, of the Public Procurement Code, which brings together in a single legal corpus all rules governing public procurement contracts. It also notes the modernization of the general administrative clause specifications applicable to public procurement (CCAGs). There are now six CCAGs, approved by Orders of 30 March 2021 with simultaneous entry into force on 1 April 2021. However, with regard to the effective application of the fundamental requirements of the Convention, which consists in the inclusion of labour clauses of the type provided under Article 2 of the Convention, the Government indicates that the essential requirement provided under Article 2 of the Convention is met under the legislative provisions and regulations in force. In any event, these provisions require that any enterprise must comply with the labour law applicable where the contract is performed and allow a public authority, through application of the CCAG clauses, to terminate a public contract in case of violation of a worker’s labour rights. Nevertheless, the Committee draws the Government’s attention to paragraph 45 of its 2008 General Survey on labour clauses in public contracts, which specifies that “… the mere fact of the national legislation being applicable to all workers does not release the States which have ratified the Convention from the obligation to take the necessary steps to ensure that public contracts contain the labour clauses specified in Article 2 of the Convention”. The Committee also specified that, “as regards the content of labour clauses, the Convention provides that they should ensure to the workers concerned wages, hours of work and other conditions of labour which are not less favourable than those established by collective agreement, arbitration award, or national laws, for work of the same character in the trade or industry concerned in the district where the work is performed. Where the conditions of labour are not regulated by any of these means in the district where the contract is executed, reference must be made to the nearest appropriate district where such means are used, or the general level of conditions of work observed in the trade or industry in which the contractor is engaged by employers whose general circumstances are similar” (paragraph 21). Recalling that the Convention requires that labour clauses with very specific content be expressly included in public contracts effectively signed between the public authority and the selected entrepreneur, the Committee expects the Government to take all measures necessary to bring the national legislation into full conformity with the essential requirements of the Convention without further ado. The Committee requests the Government to keep the Office informed of progress made and reminds the Government that it can, if it so wishes, avail itself of the technical assistance of the ILO in this regard.

Observation (CEACR) - adopted 2017, published 107th ILC session (2018)

Article 2 of the Convention. Inclusion of labour clauses in public contracts. In its previous comment, the Committee requested the Government to keep the Office informed of any developments, particularly in terms of legislation, with regard to the application of the Convention at the national level. The Committee notes that the Government has adopted several legislative texts to transpose European Directives on public procurement (European Directives 2014/24/EU and 2014/25/EU) and concession contracts (European Directive 2014/23/EU). The Government indicates in its report that Ordinances Nos 2015-899 of 23 July 2015 on public procurement and 2016-65 of 29 January 2016 on concession contracts, and their implementing decrees, constitute progress towards compliance with labour standards by holders of public contracts and their subcontractors. The Government adds, however, that these new provisions are not sufficient to give full effect to the obligations of the Convention, for the same reasons as those indicated in its previous reports. It points out that it is impossible to amend these rules to bring them into conformity with the obligations of the Convention, unless measures are adopted that are contrary to the law of the European Union. For example, the new legislative texts did not reintroduce measures that would require the formal insertion of labour clauses in public contracts. The Government specifies, however, that French domestic positive law provides for similar obligations offering sufficient protection which is comparable to that established by the Convention. In its General Survey of 2008 concerning labour clauses (public contracts), paragraph 40, the Committee recalled that the essential purpose of the Convention and its Recommendation is to ensure that the workers employed by a contractor and paid indirectly out of public funds enjoy wages and conditions of labour which are at least as satisfactory as the wages and conditions of labour normally established for the type of work concerned, whether they are established by collective agreement or otherwise, in the locality where the work is done. The Convention requires that this be done through the insertion of appropriate labour clauses in public contracts. This has the effect of setting as minimum conditions for the contract standards that are already established within the locality. Labour costs are thus removed from competition between bidders. The further aim is that local standards higher than those of general application should be applied, where they exist. In its previous comment, the Committee emphasized that Article 2(1)(a) of the Convention refers to all the collective agreements concluded between employers’ and workers’ organizations representing a substantial proportion of employers and workers in the trade or industry concerned, and not only collective agreements that have been extended. The Government indicates in this regard that the compliance with collective agreements that have not been extended cannot be imposed on all public contract holders and subcontractors. Only the implementation of collective agreements declared to be of general application, following the adoption of an extension order, can be required of subcontractors that are not domiciled in France. Furthermore, the Government recalls that the Court of Justice of the European Union has found that national legislation cannot require public procurement contractors and their subcontractors to respect the provisions of collective agreements when they have not been declared of general application. The Committee once again recalls that the fundamental requirement of Article 2 of the Convention is that public contracts to which the Convention applies must include clauses ensuring to the workers concerned wages, hours of work and other conditions of labour which are not less favourable than those established for work of the same character in the trade or industry concerned in the district where the work is carried out. The Convention provides that these clauses may be established by collective agreement, arbitration award or national legislation. Article 18(2) of Directive 2014/24/EU provides, with regard to the principles of procurement, that “Member States shall take appropriate measures to ensure that in the performance of public contracts economic operators comply with applicable obligations in the fields of environmental, social and labour law established by Union law, national law, collective agreements or by the international environmental, social and labour law provisions listed in Annex X”. The Committee observes that the eight fundamental ILO Conventions are listed in the Annex. In box 5 of its 2008 General Survey, the Committee emphasized that the ILO Declaration of 1998 on Fundamental Principles and Rights at Work and the Convention proceed along parallel lines and emphasized the complementarity of the two sets of principles and the importance of the Convention as a possible mechanism for promoting core labour standards. Furthermore, the Committee observes that the Court of Justice of the European Union found in 2015 that the European Directives do not prevent the exclusion from public procurement of bidders who do not undertake to pay minimum wages to the workers concerned. Moreover, the Committee observes that, as noted by the European Committee of the Regions in Opinion No. 2016/C 051/04 on standards of remuneration in employment in the European Union, an interpretation of legislative texts transposing European Directives allowing for the unequal treatment of bidders could lead to social dumping. The Committee once again requests the Government to continue providing more detailed information on any legislative changes that could have an impact and the application in practice of the Convention at the national level. It also requests the Government to provide a copy of any court decision or official publication involving questions of principle related to the application of the Convention.

Observation (CEACR) - adopted 2011, published 101st ILC session (2012)

Article 2 of the Convention. Inclusion of labour clauses in public contracts. The Committee notes that, in reply to its previous comment, the Government asserts that the Public Procurement Code of 2006 does not provide for the formal inclusion of labour clauses in public contracts as national statutory law already establishes the requirement of compliance with such clauses. It notes the Government’s reference in this respect to the requirement placed on those concluding public contracts to comply with labour legislation. The Committee further notes the adoption of the new general administrative clause specifications (CCAG), such as those approved by the Order of 19 January 2009 approving the specifications for general administrative clauses in public contracts for ongoing supplies and services, which reiterate this obligation and place the requirement on the contractor to comply with the ILO’s eight fundamental Conventions. It notes that, according to the Government, in relation to social issues, it is in the interests of the adjudicating authority to make principal use of the executing clause in section 14 of the Public Procurement Code, which allows it to have the service performed, under certain conditions indicated in the Government’s report, with the inclusion of considerations such as the insertion of persons with few opportunities for employment, the implementation of training activities for them and the promotion of fair trade. The Committee also notes the detailed information contained in the Government’s report concerning the recommendations made in this field by the Public Procurement Advisory Commission. It also notes that, under section 55 of the Public Procurement Code, abnormally low offers can be discarded, after requesting tenderers to provide justifications relating to the working conditions applicable where the work is to be performed. In addition, the Committee notes the Government’s indications that French labour law requires compliance, by any subcontractor based in France of a principal contractor for public works, with all the collective agreements extended by ministerial order. It further notes that service providers located abroad who are covered by European Directive No. 96/71/EC concerning the posting of workers in the framework of the provision of services, are also required, for a nucleus of mandatory rules, to comply with the content of extended collective agreements. The Committee notes that, according to the Government, the objective of the Convention is achieved in French legislation and that requiring all subcontractors to comply with collective agreements that have not been extended would be contrary to Community law, as established by the case law of the Court of Justice of the European Union (CJEU), and particularly the Rüffert ruling of 3 April 2008.

With regard to the requirement for parties to public contracts to comply with labour legislation, the Committee recalls its previous observations, in which it emphasized that the fact that the labour legislation is applicable to all employers and all workers, including those involved in public contracts, does not release the Government from the obligation to require the inclusion of labour clauses in such contracts. Indeed, such clauses retain their full value in cases in which, as in France, the legislation only establishes minimum labour conditions which may be exceeded by general or sectoral collective agreements. Moreover, the Committee notes that the Government refers to section 43 of the Public Procurement Code, which provides for the exclusion from public contracts of economic operators who have been convicted for violations of the rules of the Labour Code, as well as those who are not in compliance with their social and fiscal obligations. It also notes that section 44 of the Public Procurement Code requires tenderers for public contracts to produce, when applying, a statement in which they certify that they are in compliance with their obligations in relation to labour legislation and are not covered by any of the exclusions set out in section 43 referred to above. Moreover, section 46 requires the selected contractors, when signing the contract, to produce certificates issued by the respective social institutions demonstrating that they are up-to-date with their social obligations. In this respect, the Committee wishes to emphasize, as it did in its 2008 General Survey on labour clauses in public contracts (paragraph 118), that the objective of the insertion of labour clauses in public contracts goes beyond simple certification, as its purpose is to eliminate the negative effects of competitive tendering on labour conditions. A mere indication that no violation of legislation has been recorded in relation to work already carried out by the entrepreneur is not sufficient to meet this requirement. Indeed, a certificate bears witness to the previous performance of the tenderer and the fact that the legislation has been respected but, in contrast with labour clauses, does not establish any binding requirement concerning the future work to be undertaken.

With regard to the Government’s remarks concerning collective agreements that have not been extended, the Committee emphasizes that Article 2(1)(a) of the Convention refers to all the collective agreements concluded between employers’ and workers’ organizations representative of a substantial proportion of employers and workers in the trade or industry concerned, and not solely collective agreements that have been extended. In its general observation of 1957, the Committee had already observed that it found itself unable to accept the view that, where legislation and collective agreements apply to all workers in a specific country, the Government was freed from the obligation to insert labour clauses in public contracts in accordance with the Convention. It emphasized in that respect that the insertion of labour clauses in public contracts may have positive advantages, particularly where collective agreements are not generally binding. That is the case in France, where not all collective agreements are extended by ministerial order. In the light of the above, the Committee requests the Government to keep the Office informed of any development, particularly in legislative terms, relating to the implementation of the Convention at the national level, and to provide a copy of any court decision or relevant official publication.

Observation (CEACR) - adopted 2008, published 98th ILC session (2009)

Articles 2 and 5 of the Convention. Inclusion of labour clauses in public contracts and sanctions for failure to comply with such clauses. In its previous comments, the Committee noted that the new Public Procurement Code, adopted by Decree No. 2006-975 of 1 August 2006, no longer gives effect to the Convention, in contrast with the Public Procurement Code of 1964. It notes the indications provided in the Government’s latest report according to which the text giving effect to the Convention in France is not and has never been the Public Procurement Code. It observes however that, in its first reports following the ratification of the Convention, the Government referred solely to the amended Decree of 10 April 1937 respecting labour conditions in contracts concluded on behalf of the State. It further notes that, in its report in 1965, the Government indicated that the above Decree had been codified in sections 117–121 of the Public Procurement Code issued by Decree No. 64-729 of 17 July 1964. The Committee considered that the Convention was fully implemented by these provisions until the adoption of the new Public Procurement Code in 2006.

The Committee notes that the Government refers in its latest report to Decree No. 51-1212 of 16 October 1951 publishing the Convention. However, it draws the Government’s attention to the fact that the mere publication of the Convention in the Official Gazette is not sufficient to give effect to its provisions. Specific measures have to be taken, particularly to require the effective inclusion of labour clauses in all public contracts to which the Convention applies, to inform those tendering for contracts and the workers concerned and to establish adequate sanctions in the event of failure to comply with these labour clauses. The Committee also wishes to point out that it never asserted that the repeal of the former Public Procurement Code had had the effect of withdrawing the Convention from the French legal order and that it merely noted that the French legislation that is currently in force no longer gives effect to the provisions of this instrument.

In this respect, the Committee notes the Government’s confirmation in its report that no specific legislation provides for the inclusion of the labour clauses required by the Convention in the public contracts to which it applies and its indication that labour legislation is binding for all employers, including those that have concluded a public contract. However, as the Committee emphasized in its observation of 2006, the fact that labour legislation is applicable to all employers and all workers, including those involved in public contracts, does not release the Government from the obligation to require the inclusion of labour clauses in such contracts. Indeed, as the Committee indicated in its General Survey of 2008 on the Convention (paragraph 41), “there would be very little meaning in adopting a Convention that would simply affirm that work for public contracts must comply with relevant labour legislation”.

The essential objective of the Convention is to ensure that workers employed in the implementation of public contracts benefit from wages, hours of work and other labour conditions that are at least as favourable as the most advantageous conditions established by collective agreement, arbitration award or national laws or regulations for work of the same character in the same region. The inclusion of labour clauses for this purpose therefore retains its full value in cases in which the legislation only establishes minimum labour conditions which may be exceeded by general or sectoral collective agreements. In this respect, the Committee recalled in the above General Survey (paragraph 104) that it was recognized when adopting the Convention “that by requiring conditions ‘not less favourable’ than those established by the three sources [namely, collective agreements, arbitration award or national laws or regulations], the automatic result would be requiring the best conditions out of the three”. In this respect, the Committee notes the Government’s indications that employers also have to take into account the wage agreements concluded at the level of occupational branches where the application of these agreements has been extended by order of the Minister of Labour under the terms of section L2261-15 of the Labour Code. The Committee however wishes to emphasize that Article 2, paragraph 1(a), of the Convention refers to collective agreements negotiated “between organizations of employers and workers representative respectively of substantial proportions of the employers and workers in the trade or industry concerned”, and not only those that have been declared generally applicable through the adoption of an extension order.

Finally, the Committee recalls that Article 5 of the Convention requires the application of adequate sanctions, such as the withholding of contracts with the contractor at fault or the withholding of payments due under the contract in the event of failure to comply with the labour clauses included in the public contract. The labour legislation does not establish sanctions of this type, which can be particularly effective and dissuasive, and does not therefore give effect to the Convention on this point.

The Committee is accordingly bound to note once again that the national legislation no longer gives effect to the Convention. It hopes that the Government will take the necessary measures in the near future to ensure the inclusion of labour clauses in all public contracts to which the Convention is applicable in accordance with the requirements of the latter and to require the application of adequate sanctions in the event of failure to comply with these clauses. In general, the Committee recalls the conclusions of its General Survey of 2008 on the Convention, in which it considered that (paragraphs 307 and 308) “labour clauses that actually set as minimum standards the most advantageous conditions where the work is being done, consistent with the notion of the State as a model employer, continue to be a valid means of ensuring fair wages and conditions of work” and that in the light “of the greater impact of globalization on an increasing number of member States and the related heightening of competitive pressures, … the objectives of the Convention” are “even more valid today than they were 60 years ago” and “ strengthen the ILO’s call for fair globalization”.

For all useful purposes, the Committee attaches herewith a copy of a Practical Guide on the Convention that was recently published by the Office, which provides clarifications on the scope of its provisions, and particularly on the inadequacy of the mere application of general labour legislation to employers parties to public contracts.

Part V of the report form. The Committee notes the Government’s indications concerning the annual programming of the activities of labour inspectors and controllers focusing on a number of priorities, including conditions of work and remuneration, which implies focusing on professional sectors and enterprises involved in public contracts. It also notes the establishment in 2007, by the General Directorate of Labour, of the Observatory of prosecutions to follow up action by the labour inspectorate. Finally, it notes the report on labour inspection in France in 2006, which the Government attached to its report on the Labour Inspection Convention, 1947 (No. 81). The Committee notes in particular that 24 per cent of enterprise inspections were carried out on construction and public works sites and that, in all sectors, 81,380 violations were reported of the legal provisions relating to the employment contract, including hours of work and wages. The Committee requests the Government to continue providing information on the results of inspections carried out in enterprises participating in public contracts, including the number and nature of the violations of labour legislation reported and the measures taken to resolve them. The Government is also requested to provide a copy of any activity report that may be published by the Observatory of prosecutions to follow up action by the labour inspectorate.

[The Government is asked to reply in detail to the present comments in 2009.]

Observation (CEACR) - adopted 2007, published 97th ILC session (2008)

The Committee notes the Government’s confirmation in its last report that the new Public Procurement Code, adopted by Decree No. 2006-975 of 1 August 2006, no longer gives effect to the Convention, in contrast with the Public Procurement Code of 1964. The Committee requests the Government to reply to the detailed comments that it made at its previous session and to indicate the reasons why the Public Procurement Code of 2006 does not contain provisions giving effect to the Convention.

The Committee also draws the Government’s attention to the General Survey that it has prepared this year on labour clauses in public contracts, which gives an overview of the law and practice of member States on this subject and contains an assessment of the impact and current relevance of Convention No. 94.

[The Government is asked to reply in detail to the present comments in 2008.]

Observation (CEACR) - adopted 2006, published 96th ILC session (2007)

The Committee notes with regret that the Government’s report has not been received. It further notes that the law respecting public contracts has been the subject of successive reforms over recent years, and particularly with the adoption of new Public Contracts Codes in 2001 (Decree No. 2001-210 of 7 March 2001), 2004 (Decree No. 2004-15 of 7 January 2004) and 2006 (Decree No. 2006-975 of 1 August 2006).

The Committee notes with regret that, contrary to Decree No. 64-729 of 17 July 1964 issuing the Public Contracts Code, which was previously applicable, the more recent versions of the Public Contracts Code, and particularly that of 2006, do not envisage the inclusion of labour clauses in public contracts. Section 14 of the Public Contracts Code of 2006 provides that “the conditions for the execution of a contract or a framework agreement may include elements of a social nature (…)”. Furthermore, under the terms of section 55, the adjudicating authority may reject an offer which appears abnormally low taking into consideration, among other factors, the provisions respecting working conditions in the location in which the service is to be provided.

The Committee is bound to observe that these provisions, which are purely optional for the adjudicating authority, do not in any manner provide for compliance with the fundamental obligation imposed by Article 2 of the Convention. Under the terms of this provision, the public contracts to which the Convention applies shall include clauses ensuring to the workers concerned wages, hours of work and other conditions of labour which are not less favourable than the most favourable conditions established according to one of the three formulae envisaged by the Convention, that is by collective agreement, arbitration award or by national laws or regulations.

The Committee further notes that the provisions of the schedules of general administrative clauses for the various types of public contracts, to which no obligatory reference is to be made under the terms of section 13 of the Public Contracts Code of 2006, do not give effect to the Convention. They are confined to providing that the entrepreneur is subject to the obligations arising out of laws and regulations respecting the protection of workers and working conditions (section 9 of the Schedule of general administrative clauses applicable to public works contracts, approved by Decree No. 76-87 of 21 January 1976; section 5 of the Schedule of general administrative clauses applicable to public contracts for current supplies and services, approved by Decree No. 77-699 of 27 May 1977; section 9 of the Schedule of general administrative clauses applicable to public contracts for intellectual services, approved by Decree No. 78-1306 of 26 December 1978; and section 8 of the Schedule of general administrative clauses applicable to industrial contracts, approved by Decree No. 80-809 of 14 October 1980).

The Committee notes in this respect the Government’s contention in its previous report that taking into account the extent of the application of legislation respecting working conditions and the coverage of collective agreements, the provisions of Convention No. 94 intended to prevent distortions in working conditions to the detriment of workers performing work in the context of public contracts and on the sole grounds that they are performing such work, have lost their value.

The Committee recalls that the mere fact that the labour legislation is applicable to workers engaged in the context of public contracts does not in any way exempt the Government from providing for the inclusion in public contracts of the labour clauses envisaged by the Convention. Such inclusion ensures the protection of workers in cases in which the legislation only establishes minimum conditions of work which may be exceeded by general or sectoral collective agreements. Indeed, the fundamental principle on which the Convention is based is that, when entering into contractual commitments involving the expenditure of public funds, the public authorities shall avoid any social dumping resulting from the intense competition prevailing in the field of public tenders.

Even if collective agreements are applicable to workers engaged in the context of the execution of public contracts, the implementation of the Convention retains its full value in so far as its provisions are designed precisely to ensure the specific protection needed by such workers. For example, the Convention requires the adoption by the competent authority of measures, such as the advertisement of specifications, to ensure that persons tendering for contracts are aware of the terms of the labour clauses (Article 2, paragraph 4, of the Convention). Notices must be posted in conspicuous places at the workplace to inform workers of their conditions of work (Article 4(a)). Furthermore, the existence of the sanctions envisaged by the Convention, such as the withholding of contracts or payments due to contractors (Article 5), permits the imposition of sanctions on the contractor, in the event of the violation of labour clauses, which may be more directly effective than those available for violations of the general labour legislation.

Finally, the Committee wishes to emphasize that the former Public Contracts Code, adopted by Decree No. 64-729 of 17 July 1964, gave full effect to the Convention by providing in section 117 that schedules of general administrative clauses had to contain clauses under which the entrepreneur or supplier, without prejudice to compliance with the requirements of laws and regulations respecting the protection of workers, undertook to comply with a number of conditions relating, among other matters, to wages and other conditions of work.

The Committee trusts that the Government will rapidly adopt appropriate measures to once again ensure the full application of the Convention, for example by adopting provisions similar to those of sections 117 to 121 of the 1964 Public Contracts Code.