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French president touts employee profit-sharing plan

French President Nicolas Sarkozy proposed on Wednesday that a third of company profits should go to employees, with the same amount reserved for shareholders and investment.

"A system in which a third of the profits of a company would be for shareholders, a third for employees and a third for investment is a system ... that would have a certain coherence and logic," he told parliamentarians.

"Those that think it is too much should say it's too much and, above all, why," he added.

Sarkozy, who oversees a center-right government, was elected on promises to reform French institutions and the economy and raise growth and living standards.

Public concern about buying power, already a hot subject during the presidential campaign early last year, remains at the top of voters' concerns in opinion polls.

Sarkozy argued that his radical proposal would help boost purchasing power, in addition to the longer working week that he intends to implement.

"Saying that sharing profits has nothing to do with purchasing power, [or] saying that a revolution as profound as the one I have proposed for sharing earnings has nothing to do with purchasing power is to treat people like fools," he said.

"I have proposed on this question of spending power a real revolution on [employee] participation and profit sharing," he said.

Returning to the hot-button issue of the 35-hour work week, which he said on Tuesday he wanted to end this year, Sarkozy argued that it was clearly linked to spending power.

"Clearly the 35-hour week has a link with spending power since it ... was clearly paid for by the sharp brake on salary increases [that resulted]," he said.

His comments on ending the 35-hour week on Tuesday sparked a storm of protest from the left and praise from the right. The issue has emerged as the lightning rod for differences over how to reform the economy and social welfare system.
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