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soon a consultation on the reform, what we know

UNEMPLOYMENT INSURANCE. After having received the social partners to present the roadmap to them to achieve full employment, the Minister of Labor must start a consultation in ten days.

[Mise à jour du mardi 20 septembre 2022 à 09h05] Will the social partners and the government manage to remain around the table to discuss the reform of unemployment insurance? The Ministry of Labor must send a consultation letter to the unions and employers, in order to change the rules of compensation. Consultation should start “in about ten days”, assured Olivier Dussopt, last Sunday at the microphone of France 3. This new deadline comes as the government has already received the social partners last week. The discussions to come promise to be difficult. No less than 13 trade union organizations published a joint press release, denouncing the executive’s project.

In particular, it provides for the extension of the current unemployment benefit rulesresulting from the latest unemployment reform (see below), as well as an overhaul of the validation of acquired experience (VAE). “It is a question of avoiding” a break in compensation “of around 2.5 million job seekers had argued government spokesman Olivier Véran after a Council of Ministers. ” There is an urgency: that the reform of unemployment insurance, decided in 2019 and implemented in 2021 due to the Covid, sees its rules extended, had indicated Olivier Dussopt, Minister of Labor, in the columns of the Parisian. They expire on November 1, 2022. We want to extend them, to allow this reform to continue to produce its positive effects and to think about the next step.”

This measure is the first step in Emmanuel Macron’s project. The President of the Republic wishes adjust the rules of compensation for the unemployed, according to the economic situation, on the Canadian model. “The principle is simple: when things are going very well, the rules must be more incentive and when things are less good, they must be more protective”, underlined Olivier Dussopt, at the microphone of France info. Two tracks are on the table: either change the duration of compensation for job seekers – currently at 24 months for unemployed people under 50 -, or act on the number of months necessary for the opening of unemployment rights, that is reduce the amount of compensation gradually. Several organizations – employers and trade unions – have expressed their opposition to the modulation of compensation rules according to the economic situation. The unions consider this measure “countercyclical”, favoring training and the attractiveness of professions in order to boost the employment rate.

In the longer term, the executive wishes to initiate a reform of Unédic’s governance. The latter is the joint body responsible for managing unemployment insurance. This reflection takes place in a context where the government wishes to carry out two parallel projects:

  1. The conditioning of the payment of the RSA to the achievement of 15 to 20 hours of weekly activity;
  2. The creation of France Travail, intended to replace Pôle emploi. “I hope that the implementation will be possible gradually from 2024”, indicated the Minister of Labor, Olivier Dussopt on Wednesday on BFM Business.

​​​​​Unemployment insurance is an allowance paid to private sector employees who have lost their jobs. The rights to compensation are calculated on the basis of the unemployed person’s former salary. Unemployment insurance plays two roles: it helps an unemployed person financially to manage his loss of employment, by maintaining his purchasing power and his living conditions. It also offers a solution for returning to work through personalized support. The allowances are paid during periods of training, business creation or retraining.

Unemployment insurance reform: what has already changed for the unemployed?

The unemployment insurance reform has been ongoing since 2019, but new changes have been implemented in 2021 and 2022. Here are the four main points of the unemployment insurance reform:

  • new calculation of the allowance;
  • reduction in unemployment benefits (degressivity) for high incomes;
  • bonus-malus on the unemployment contribution;
  • change in the minimum working time to receive unemployment insurance.

This reform provides for the compensation of self-employed workers and resigning employees with a retraining project, under certain conditions. The minimum duration of work to benefit from unemployment benefit increases from 4 months to 6 months of work over the 24 months preceding the end of the last contract.

Unemployment insurance and compensation, how does it work?

Unemployment insurance or ARE (return to work allowance) is calculated on the income of the last 12 months, taking into account the days worked. The unemployment insurance reform provides for new calculation rules, establishing an average monthly income including working days and periods of inactivity. For high salaries, a degressivity may apply to the amount of the allowance, with a reduction of 30% after 8 months of compensation.

Private unemployment insurance, for whom?

A private unemployment insurance is an insurance which makes it possible to compensate for the drop in income following a loss of employment. It is aimed at business leaders as a main insurance, the latter not benefiting from aid from Pôle Emploi. It can also concern employees, who want help in addition to traditional unemployment insurance.

Affiliation to the unemployment insurance scheme

Unemployment insurance is compulsory for all private sector employees and is financed by them in the form of payroll deductions. All private employers must join the unemployment insurance scheme. Solidarity, the allowance makes it possible to best support former employees with low incomes, who are favored over those who benefited from a high salary.



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