unions and employers reach an agreement which replaces the compensation rules envisaged by Attal

UNEMPLOYMENT – The reform of unemployment insurance desired by former Prime Minister Gabriel Attal had been abandoned with the anticipated legislative elections. The social partners managed to agree on new rules concerning it on Thursday, November 14, and these now appear to be a far cry from what was proposed by the previous government. Employers and several unions have also decided on the question of employment of seniors with the added bonus of an agreement on union pathways.

“We managed, after a flash negotiation, to reach a conclusion this evening”greeted the Medef representative Hubert Mongon at the end of the discussions, noting a “majority of favorable opinions” on agreements, “with nuances”. However, there is a downside on the employers’ side: if Eric Chevée (CPME) judged that the agreement on unemployment insurance “no problem”he was much more critical of the one on seniors that he judged “not balanced”.

Overall, the new rules would make it possible to generate some 2.3 billion savings over four years for the unemployment insurance system, according to a calculation by Unédic. Unions and employers were keen to agree to prevent the government from taking control again, as the Attal government had done in the spring after the failure of negotiations on seniors, publishing a decree whose unions had unanimously denounced. « violence ».

The government reacted on Friday November 15 by welcoming the agreement, said executive spokesperson Maud Bregeon. “This demonstrates that the Prime Minister’s method of leaving room for social dialogue is bearing fruit”she added on franceinfo, therefore excluding the government from taking control of this issue.

• Relaxation of access conditions

To hope to generate 3.6 billion euros in savings while public finances were in the red, Gabriel Attal wanted to go from 6 months of work out of 24 months necessary for the opening of rights to unemployment benefit to 8 months worked over 20 months.

But the social partners on the contrary decided on Thursday to ease the access conditions: to register for unemployment insurance for the first time, you will need to have worked at least 5 months – and not 6 months – over the last 24 months. The measure represents a cost of some 440 million over four years for the unemployment insurance system.

Seasonal workers can also be compensated after 5 months of work.

· Monthly payment

The allowance paid will be the same each month based on 30 days, regardless of the length of the month. Over a full year, the unemployed will therefore lose five days of compensation, and even six in leap years. The measure should bring in 1.2 billion over four years.

• Employment of seniors

Gabriel Attal wanted only those over 57 to be able to receive unemployment plus for 22.5 months instead of the maximum 15 months under common law. Previously, 53-54 year olds could benefit from unemployment insurance for 22.5 months, and up to 27 months for 55-57 year olds.

During Thursday’s negotiations, the social partners actually raised the age limits giving entitlement to longer compensation, but the measure is less harsh than that wanted by the previous government. The level giving entitlement to a maximum of 22.5 months of compensation thus increases from 53 to 55 years and that giving entitlement to 27 months from 55 to 57 years. The maximum duration of compensation for those under 55 will be 18 months.

To take into account the particular situation of seniors, the reduction in unemployment benefit, which concerns high incomes, will no longer be applied from the age of 55, compared to 57 until now.

• Reduction in employer contributions

The employer contribution for unemployment insurance will increase from 4.05% to 4% of gross salary. The measure will come into force from May 1, 2025. It is expected to cost nearly 1.5 billion euros over four years.

In order to get closer to the 400 million euros in additional savings requested from 2025 from the social partners by the Minister of Labor Astrid Panosyan-Bouvet, the employers accepted that the reduction from 4.05% to 4% of the employer contribution unemployment insurance does not come into effect until May 1, 2025.

• The question of cross-border workers

Compensation for cross-border recipients represents an additional cost of around 800 million euros per year for unemployment insurance, according to Unédic. This is because their rights currently depend on their salaries abroad, which are generally significantly higher than in France. The draft agreement intends to apply a coefficient to these rights according to the salary level of the country in which they worked, which should lead to a significant drop in their compensation in the vast majority of cases.

The signatories also request a review of the notion of“reasonable offer of employment” so that cross-border workers cannot refuse a position at French salary level. Overall, according to a calculation by Unédic, 1.4 billion euros in savings should be generated over four years.