PARIS (Reuters) - French trade unions ramped up calls on Wednesday for companies to scrap shareholder dividend payments to conserve cash and show solidarity with workers during the coronavirus crisis.
Companies worldwide have come under pressure to review dividend payouts as the crisis hits the global economy, with European planemaker Airbus (PA:AIR) on Monday joining U.S. rival Boeing (N:BA) in scrapping its 2019 dividend.
"It would be neither reasonable nor responsible for companies to pay dividends to their shareholders as if nothing were happening," France's leading CFDT union said.
State-owned companies in particular should set an example by hanging on to their cash, it added in a statement.
Unions at French gas and electricity supplier Engie (PA:ENGIE) on Wednesday asked the government to back their proposal that it scrap its planned dividend on 2019 earnings.
In a letter to the state, Engie's leading shareholder, unions urged economy minister Bruno Le Maire to vote against a planned dividend payment of 0.80 euros per share for 2019.
Engie, in which France holds a 23.6% stake, declined to comment on forgoing the 2019 dividend, which is due to be voted on during its general assembly meeting on May 14.
The unions, including the main hard-left CGT and FO groups and the moderate CFDT, CFTC and CFE CGC, said in a joint letter that Engie must do everything in its power to secure its cash flow in order to support its customers and suppliers.
The unions propose that in coming years Engie's dividend be capped at 50% of its net income. That compares with a planned payout ratio of 72% on 2019 earnings for the dividend, which is set to be paid in May.
"Many employees have to adapt under sometimes difficult conditions, to ensure continuity of service, it would be incomprehensible if shareholders did not also make an effort," CFDT national secretary Philippe Portier said in a statement.
It said companies in France blue chip CAC 40 (FCHI) have paid out nearly 50 billion euros (46.2 billion pounds) to shareholders in 2019.
French economy minister Le Maire on Tuesday asked companies, especially the largest, to show "moderation" in their dividend payment policy.