The French government will set new rules for unemployment benefits starting July 1, acknowledging the “disagreement” between social partners according to a statement from the Ministry of Labor. The government will establish a decree aimed at achieving full employment and promoting the quick return to work of those receiving benefits. Employers and trade unions have lost control over defining these rules in favor of the executive, similar to what happened in 2019.
The Ministry notes that social partners failed to reach an agreement in negotiations on the work-life pact, which focused on senior employment, professional conversions, and the universal time savings account (CETU) initiated in December. The outcome of these negotiations was crucial for the implementation of the unemployment insurance agreement from November 2023 to make it compatible with the summer 2023 guidance document, which aimed to save on benefits for older job seekers.
Unemployment benefits were governed by a waiting period decree that was set to expire at the end of 2023, but was extended for six months until June 30. Prime Minister Gabriel Attal had expressed the intention to further reform unemployment insurance back in January. He identified three key areas for potential rule changes: duration of benefits, affiliation requirements, and benefit levels. While stating that all three options were on the table, he expressed a preference for tightening affiliation requirements.
Last week, Prime Minister Attal reiterated his commitment to moving forward with reform and mentioned potential changes to the duration and level of benefits. However, he faced criticism for not taking more political risks in the reform process. The decision to continue with the reform plans despite the lack of agreement among social partners reflects the government’s determination to address issues related to employment and the sustainability of the social security system.
Overall, the French government’s decision to implement new rules for unemployment benefits reflects a shift in control from social partners to the executive, with a focus on achieving full employment and promoting a quicker return to work for those receiving benefits. While the lack of agreement among social partners may lead to some challenges in the implementation of the reforms, the government is determined to move forward with the changes to ensure the sustainability of the unemployment insurance system and address issues related to senior employment and professional conversions.
