“a text for the end of the year”?

UNEMPLOYMENT INSURANCE. Invited to the microphone of France info, the Minister of Labor promised a text by the end of the year in order to implement the reform of unemployment insurance.

[Mise à jour du jeudi 03 novembre 2022 à 09h36] Will the executive succeed in implementing its unemployment insurance reform? “There will be a text for the end of the year,” promised the Minister of Labor, Olivier Dussopt. In addition to the extension of the compensation rules resulting from the 2019 reform, the project should allow the government to adjust the system, depending on the economic situation. The heart of the project is based on the modulation by decree of the conditions for benefiting from unemployment insurance according to the economic situation.

In other words, to ensure that the unemployment insurance scheme be “stricter when too many jobs are unfilled, more generous when unemployment is high” in order to resolve recruitment difficulties in many sectors (construction, hotels and restaurants, etc.), explained Emmanuel Macron during the presidential campaign.

The government has initiated discussions with the social partners on the reform of unemployment insurance. All the difficulty now lies in determining the criteria for changing the unemployment insurance system according to the economic situation (conditions for granting unemployment benefit, duration of compensation, etc.). DBilateral meetings must now be organized with trade unions and employers’ organisations. The closing meeting will take place on November 21, for an application of the decree “as soon as possible”, had insisted the cabinet of Olivier Dussopt. These statements come as deputies and senators must now agree on a common version of the bill in a joint committee, after the adoption of the text in the Assembly and the Senate.

​​​​​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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