Unemployment insurance facing a new turn of the screw

A pending deal

The unemployment insurance system is managed by Unédic, a joint organization. The social partners renegotiate the rules every 2 to 3 years to take into account changes in the labor market, these rules being formalized in an agreement that the State validates. But since 2018, their room for maneuver has been restricted because the government sends them a “framework letter” in advance which sets objectives (notably savings) to achieve. Without agreement, the State takes control again with a “deficiency decree”.

Despite these constraints, employers and the CFDT, FO and CFTC reached an agreement on November 10 on the compensation rules for the next four years.

But the government decided not to approve the agreement while awaiting the outcome of another negotiation on the employment of seniors, under discussion until the spring.

An eager executive

For three months, the executive has demonstrated its desire to further tighten unemployment insurance rights, after two reforms to this effect in 2019 and 2023.

Prime Minister Gabriel Attal declared on RTL on Tuesday that he was in favor of "reopening the construction site" of unemployment insurance to have "a social model which encourages more activity".

The first warning shot was given at the end of November by the Minister of the Economy Bruno Le Maire for whom the duration of compensation for seniors should be aligned with that of other unemployed people, by reducing it from 27 to 18 months.

On January 16, Emmanuel Macron - who wants to reduce the unemployment rate to 5% in 2027, against 7,5% currently - broadened the spectrum by announcing an "Act II of labor market reform".

In Davos, Switzerland, the next day, he confirmed that he wanted to “tighten the rules of unemployment insurance”.

In his general policy statement on January 30, the Prime Minister indicated that he would request a review of the rules of unemployment insurance if its financial trajectory "deviates".

On February 20, Unédic revised its surplus downwards, mainly due to a drain from the government to finance France Travail, which has replaced Pôle Emploi since January.

“We are currently studying” the consequences of the deterioration of Unédic’s accounts, Gabriel Attal told JDD in an article published on Sunday.

“We went from 24 months to 18 months of compensation duration, we can further reduce it. We can also increase the degression of allowances, this will be part of the discussions,” the Prime Minister further indicated.

Worried social partners

The government had said that it would validate the new unemployment insurance agreement as long as the savings requested in the senior sector (440 million euros) were made, but "we are worried about respecting the word given". CFDT negotiator Olivier Guivarch told AFP.

On behalf of the CGT, Denis Gravouil denounces the "new blackmail of the government to what rights remain for the unemployed". He accuses her of “lying” by implying that “benefits prevent you from looking for work”.

Another “tartuffery” in the eyes of the trade unionist, the modulation of allowances according to the situation of the labor market (countercyclicality), applied since February 2023. The reduction in rights was then “justified by the + fall + in unemployment” and “this year , it is going back up but the government wants to further reduce rights.”

For Michel Beaugas (FO), the executive wants to "take back control. Put us in conditions such that we could not redo an agreement and therefore definitively have a deficiency decree".

On the employers' side, Medef number one Patrick Martin judged on Thursday "premature" that the government is now sending a new framework letter, "for reasons of social climate and respect for social partners".

"Everyone knows that we are going to get a framework letter next June, everyone knows that behind it", the specific rules for seniors will be removed or "very strongly challenged", observed Eric Chevée in mid-February (CPME).