[citation needed] The CNE was created by the French government as part of its June 2005 Emergency Employment Plan [1] to fight France's high unemployment.
The plan aimed to create jobs by giving flexibility to small businesses, since many employers blame their inability to hire on rigid French labour laws.
The flexibility clause was a major break with the protective conditions usually applying to long-term job contracts in France.
If a plaintiff (employee) alleges they have been fired due to discrimination based on religion, political opinion, physical disability, age or sexual orientation, the Conseil d'Etat ruled to reverse the burden of proof to the employer's side.
[5][6][7] According to Prime Minister Dominique de Villepin, easier firing would make small companies less reluctant to hire new employees.
This idea is not new; employers and economists have been asking for more flexibility, and consider that globalization makes protective labour law unaffordable.
According to supporters, the CNE's primary advantage is the creation of jobs which would not have existed without the law; this indicates that improved employer flexibility helps reduce unemployment.
The study also showed that an additional 20 percent of jobs would have been delayed without a CNE, demonstrating employers' reluctance to hire under existing long-term contracts.
One consequence of the two-year probation is flexibility for employees, who are free to change jobs during their first two years without the usual one- to three-month advance notice required by long-term contracts.
They argue that it may be difficult to counter the inversion of the burden of the proof introduced by the new contract (for example, if an employee is fired because of psychological pressure such as sexual harassment).
The impact of CNEs has been questioned by Le Canard enchaîné, which quoted the INSEE study, the ANPE's records and trade unions.
Confronted with multiple reversals of firings because of "abuse of right", "the CGPME, organisation of small employers, gave as instructions to its members to justify from now on ruptures" (i.e. to not implement CNEs).
On October 17, 2005 the Conseil d'Etat, France's supreme court, declared the two-year "fire-at-will" period "reasonable" and in accordance with convention 158 of the International Labour Organization.
The court considered the two-year "fire at will" period "unreasonable" and contravened convention 158 of the International Labour Organization (ratified by France).
The court ruled on the case of Linda de Wee, who had been hired with a CDD (temporary contract) on July 1, 2005 as a secretary.
CGT trade union leader Bernard Thibault hoped that the decision would mark the end of the controversial contract.
The International Labour Organization agreed with the French courts in its November 2007 decision (dec-GB.300/20/6), issued at the request of the Force Ouvrière trade union.