In full swing on pensions, SNCF becomes a public limited company which no longer hires railway worker status

With an organizational chart still incomplete, the SNCF transforms on Wednesday 1st January into a public limited company which will no longer hire its new recruits as railway workers. This key stage of the 2018 rail reform goes almost unnoticed, during the strike.

The government had won a remarkable victory when it passed its “law for a new railway pact” in the spring of 2018, after a long strike of three months – two days every five days – carried out by all the railway unions.

“The unions (…) felt a form of bitterness, frustration quite strong, which is part of the landscape”, observed a few weeks ago the new boss of the public group, Jean-Pierre Farandou. And this bitterness undoubtedly explains the determination of many railway workers in their fight against pension reform, a movement which has greatly disrupted the circulation of trains since December 5.

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Currently a public industrial and commercial establishment (EPIC), SNCF will become a public limited company on Wednesday, which will hold all of the shares of SNCF Réseau and SNCF Voyageurs, without the possibility of selling them. These two entities will also be limited companies.

“A company in its own right”

Change is important because it makes the group “A company in its own right”, to use the expression of its former boss Guillaume Pepy. He will notably have to manage his investments, avoid losses, control his debt, and is – in theory at least – likely to go bankrupt.

The State shareholder demands that SNCF make serious savings in order to be more competitive, in a context of the opening of rail to competition. Bercy will in return take over 35 billion euros of SNCF Réseau’s debt (out of more than 50 billion).

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SNCF Réseau (which manages the infrastructures) keeps roughly the same perimeter, but will now own 100% of Gares & Connexions, the branch which takes care of stations, whose domain will be more rational.

The other major component of the public rail group, SNCF Mobilités, will in turn be dismantled, since the stations will be sold to Réseau while Keolis (public transport, 70% owned subsidiary), Geodis (logistics) and rail freight ( which also becomes a public limited company) will depend directly on the head structure.

The rest of Mobilités becomes an SA called SNCF Voyageurs, which will include TGV and Intercités, TER, Ile-de-France suburban trains and the site.

The new employment contract is ready

The strike somewhat thwarted the will of Jean-Pierre Farandou – stationed at the head of the group since 1st November – to complete its organizational chart in time before the fateful date of 1st January 2020.

He notably appointed his lieutenant Christophe Fanichet at the head of SNCF Voyageurs and the current CEO of SNCF Réseau Patrick Jeantet to that of Keolis (which he headed until October). But Mr. Jeantet must remain in office until he is found a successor, which should be done ” early January “ according to the minister of ecological transition Elisabeth Borne.

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Another major revolution on January 1: the SNCF will no longer hire a railway worker, a totem guaranteeing them a regular career, protection against redundancy, as well as a social security system and, for the time being, specific retirement, among other material benefits.

Those with status – they were 127,442 at the end of 2018, or 89% of the workforce in the public rail group – will remain, but Jean-Pierre Farandou wants more flexibility in the definition of the different trades and in the organization of work. For future hires, the new work contract is ready, we tell the SNCF.

The railway reform building still looks a little unfinished, since the sector’s collective agreement is still incomplete. A section on the definition of trades and remuneration could be completed in February, according to the Union of Public Transport and Railways (UTP).

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