Negotiated terminations: Parliament approves the agreement between social partners reducing the duration of unemployment benefits

The National Assembly approved this bill on second reading by 353 votes to 114, with the support of the right, the center and the far right, and in the same terms as the Senate two weeks ago.

"You have allowed social democracy to join parliamentary democracy," declared Labour Minister Jean-Pierre Farandou in the chamber. "This reform should allow for 15.000 additional returns to employment," added Prime Minister Sébastien Lecornu.

In mid-April, during its first reading, the bill suffered an unexpected setback when it was rejected by the deputies due to a lack of mobilization from government troops, who were outnumbered that evening by those of the left, led by La France Insoumise. This forced the executive branch to put it back on the agenda.

Created in 2008, negotiated terminations allow an employer and an employee to amicably terminate a permanent employment contract and for the employee to receive unemployment benefits.

With 515.000 individual negotiated terminations signed in 2024, they are increasing and now represent more than a quarter of unemployment insurance expenditure.

"A dangerous trend," according to Jérôme End (LR). Horizons MP Nathalie Colin-Oesterlé highlighted the profile of those benefiting from negotiated terminations, who are "more qualified" yet remain "unemployed for comparatively longer." "This paradox has a name: the optimization of benefits," she stated.

The agreement reached in February between three employers' organizations (Medef, CPME, U2P) and three trade union organizations (CFDT, CFTC and FO) notably provides for reducing the maximum duration of compensation for beneficiaries under 55 years of age from 18 to 15 months, after an amicable termination of employment contract.

This period would be set at 20,5 months for those over 55 (compared to the current 22,5 months for those aged 55-56, and 27 months for those 57 and over). Seniors would, however, have the option of requesting an extension of their compensation, assessed on a case-by-case basis.

This agreement, which the CGT and the CFE-CGC did not sign, required an amendment to the labor code to allow its implementation.

"By signing the agreement on negotiated terminations, the CFDT had set itself an objective: to avoid the unilateral tightening of unemployment insurance rules initially envisioned by the Attal government and then Bayrou," reacted France's largest union.

On the left, while a majority of socialists abstained, La France insoumise, the communist group and the Ecologists opposed the text.

Those over 57 will lose "a quarter of their benefits," denounced Sophie Taillé-Polian (Green Party). This comes at a time when many negotiated terminations are "in reality disguised dismissals, used by employers to get rid of an employee without cause and without risk of being taken to the labor court," she added.

The measure is expected to generate up to 800 million euros in annual savings from 2029 onwards.

Illustrative image of the article via Depositphotos.com.