The new measures – the first major economic reforms since Mr Macron took power in May – overhaul the country’s labour code which is over 3,000 pages long and contains some chapters dating back more than a century.
They give companies more flexibility in negotiating wages and conditions directly with employees rather than being bound by industry-wide collective deals negotiated by trade unions.
They also cap payouts on unfair dismissals which bosses have always complained were costly and often featured lengthy court cases.
The president described his reforms as an “unprecedented transformation of our social and economic model”.
He said the decrees would become law over the next few days although they do not take effect in practice until further decrees spelling out finer details are signed before the end of the year.
Leaders and members of labour unions who oppose the reform have marched through cities across France in protest.
The changes are the first in a number of reforms Mr Macron has promised with the aim of reinvigorating the economy and bringing down unemployment.
There are also plans to amend the unemployment benefits and pension systems, changes that are likely to provoke more civil unrest.
Mr Macron has seen his popularity slide dramatically since he came to power on 7 May.
A poll on 27 August suggested his approval ratings had fallen from 57 per cent in July to 40 per cent.
Former election rival Jean-Luc Mélenchon said he ruthless leadership style was partly to blame for the slump in popularity.
Left-winger Mr Mélenchon wants to position himself as the main voice of opposition against the president and has made it his duty to challenge the government’s radical reform agenda.
He said: “Mr Macron is incredibly hardline and no-nonsense, which explains why his inner-circle has blindly rallied behind him.
“He basically told them: ‘Look, I am the boss, and now we’re going to crush those who oppose us’.
“But winning an election doesn’t give those in power carte blanche to do what they want with the country.
“The battle of France has only just begun.”