France: The duration of unemployment benefits cut by a quarter


by Caroline Pailliez

PARIS (Reuters) – The duration of compensation for jobseekers will be reduced by a quarter to “encourage” unemployment benefit recipients to find work, the Minister of Labor announced on Monday, sparking strong protest from from trade unions.

The French government has presented to the social partners its reform of unemployment insurance which introduces a mechanism for adjusting the rules of compensation according to the situation of the labor market, with the aim of responding to the recruitment difficulties of companies.

The unemployment rate calculated according to the standards of the International Labor Office (ILO) stood at 7.3% in the third quarter in France, its lowest level in the last fourteen years, while, according to the ministry, 60 % of companies say they have difficulty recruiting.

“With this reform, we have kept one of the most generous unemployment insurance compensation systems in Europe,” assured Olivier Dussopt during a press conference.

The duration of compensation will thus be reduced by a quarter of their time for beneficiaries of unemployment benefit – with the exception of job seekers in the Overseas Territories or even intermittent entertainers.

This means, for example, that a jobseeker who was currently entitled to receive benefits for 24 months will only receive benefits for 18 months.

The rights will only be fully restored if the unemployment rate within the meaning of the ILO exceeds 9% or if its quarterly evolution exceeds 0.8%, specified Olivier Dussopt.

However, the duration of compensation cannot be less than 6 months.

NEW RULES IN 2024

The mechanism, which will be introduced by decree, will only concern new Unédic registrants from February 1, 2023 and until December 31, 2023, as defined in a law adopted last week in Parliament.

This should give the social partners time to negotiate a new agreement for Unédic. But the government has already said that this principle of taking into account the economic situation should be preserved.

The government estimates that the reform will allow the return to the labor market of 100,000 to 150,000 jobseekers in 2023 and will generate four billion euros in savings per year.

This project has sparked a wave of protest from trade unions, who denounce an economic reform that risks leading to the precariousness of already fragile populations, especially seniors, who have more difficulty finding a job. The duration of compensation will be reduced by 9 months for those over 55 years old.

“What portends there is between 3.5 and 4 billion in savings on the backs of the most precarious, of those who have no job in this country. It’s a scandal”, has said the negotiator for Force Ouvrière, Michel Beaugas, after the meeting.

“It’s a trap to precariousness. Job seekers at the end of their rights, they will have to eat. They will take small jobs to survive and they will sink into it”, said for his from CFTC negotiator Eric Courportin.

The CGT speaks of an “unacceptable” reform which “rolls out the carpet for employers”. For the CFE-GCG, the executives it represents are increasingly questioning the usefulness of continuing to contribute to a scheme that is less and less favorable to them. They had already experienced a degression of their allowances in a previous reform.

The employers’ organizations, for their part, welcomed the “readability” of the mechanism. For the CPME, there are “safeguards” with in particular the minimum duration of compensation of six months. Hubert Mongon, the Medef negotiator, for his part evokes a “device which allows us to go in the right direction, towards a return to work”.

Asked about the impact of the reform on seniors, the employers’ representatives ensure that their situation will be taken into account during the negotiations on pensions currently underway.

(Report Caroline Pailliez, written by Myriam Rivet, edited by Kate Entringer and Sophie Louet)

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