Duration and conditions of compensation, degression… Gabriel Attal’s ideas for reforming unemployment insurance

We are shaking… without a rudder. Gabriel Attal does not receive unemployment insurance. Indeed, there will be a new reform. “The goal is full employment,” the Prime Minister recalled on TF 1 television news, insisting on the need to tighten unemployment benefits to “further encourage a return to employment.” “The financial context has changed” and “the system still does not keep up with the times.” despite two reforms in 2019 and 2023,” says one of his advisers.

If there is an urgent need to act, the timetable announced by the Prime Minister will provide time for discussions. “I am committed to dialogue,” he repeated. Contrary to the radical proposal of the Minister of Economy to take over control, the social partners who administer unemployment insurance (through Unédic) will continue to be responsible. “I asked my labor minister to prepare new negotiations,” said Matignon’s boss.

“Reduce the compensation period by several months”

The frame letter must be sent by the end of April. The task of the social partners is to move the queues “by the summer,” the Prime Minister specified. With pre-set levers: “One parameter could be to reduce the duration of compensation by a few months (from today’s 18 months), but not below 12 months,” said Gabriel Attal. Another scenario is a tightening of the conditions for receiving benefits. Today you must have worked for six months in the last two years. “Here we can also imagine an increase in the required working time or a reduction in the reference duration,” he sketches.

The last path mentioned is the level of remuneration, by revising the reduction parameters (30% less after seven months) in force for the highest salaries from 2021. “That’s my least preference,” Attal says. What if the social partners are unable to reach an agreement at the end of the deadline, which unions say is a likely scenario? Then the government will take control of the situation. In any case, the reform will come into force no earlier than the fall at best.

“Budget reform” for trade unions

The method and timing will undoubtedly help in the short term to reassure employers and especially unions, who already have weapons against what he calls “fiscal reform.” The Prime Minister confirmed this, they are confident that they will be able to complete negotiations on pensioners (April 8). But also those that are in compensation channels for people over 55 (April 10). The government expects the amendment to finalize a new unemployment insurance agreement signed in November 2023 that had been delayed.

This involves a two-year postponement (in line with the pension reform) of all age limits for older pensioners, opening up a longer compensation period: currently the duration is 22.5 months for older people aged 53 to 54 and 27 months for old people. for people aged 55 and older, compared with 18 months for everyone else. “If they comply with these frameworks, we will approve a new agreement on unemployment insurance. It will come into force, as agreed, on July 1,” says Matignon. We are waiting for the new rules to come into force…