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Unemployment insurance: new round before the Council of State between the executive and the unions – France


Unions and government are confronted again this Thursday before the Council of State on the modification of the calculation of unemployment benefit, the former hoping to obtain, as in June, a suspension of these rules, which came into force on October 1 after a new decree.

All the major confederations seized the highest administrative court in summary proceedings on this new decree, published on September 30. This should be pronounced urgently in the coming days and a new hearing on the merits will be held within a few weeks.

The unions had urgently obtained in June the suspension of the new rules for calculating the daily reference wage (SJR), the basis of unemployment benefit and the flagship measure of the reform which was to come into force on July 1.

Without calling into question the principle of the reform, the Council of State had put forward “uncertainties about the economic situation” to suspend the application of these new rules which will penalize the compensation of job seekers alternating periods of work and work. ‘inactivity.

“Passage in force of the government”

According to the executive, this is through these new rules to encourage job seekers to accept longer contracts, especially since employers will also be encouraged to offer them by setting up a “Bonus malus” on unemployment contributions in certain sectors that are large consumers of short contracts.

But without waiting for the decision on the substance, the government published a new decree, identical to the previous one with simply an entry date postponed to October 1, justifying it by “the sharp rebound in employment since May”, with a number of unemployed which is approaching its pre-crisis level.

In fact, the first payment of post-reform allowances will not take place before the beginning of November, which leaves the Council of State time to make a decision.

The lawyer of the CGT, Me Antoine Lyon-Caen, intends to denounce “a passage in force of the government” which, according to him, “did not have the right to publish a new decree as long as the decision of the Council of State of June was in effect ”. “He should have asked the Council of State beforehand to review his June ordinance by showing him that the situation had totally changed,” he told AFP.

Offset with the bonus malus

Basically, the main advantage of the unions remains the time lag between the entry into force of the new calculation method on October 1 and that of the bonus malus which will not be applied to contributions until September 2022.

The government retorts that the “observation period” for companies to calculate this modulation started on July 1, 2021.

But, in June, the Council of State noted that modulation “will not become (it) effective until September 1, 2022, and only until October 31, 2022 (Editor’s note, application term of the reform which will have to be renegotiated according to the law in the previous months), which largely attenuates the supposedly incentive nature of the observation period ”.

The FO negotiator, Michel Beaugas, does not want “the debate on the economic situation to obscure the basic debate on the inequity of this reform”.

The “behavioral effects” hoped for by the government

According to an assessment by Unédic in April, up to 1.15 million people opening rights in the year following the entry into force of the reform would receive a lower monthly allowance (by 17% on average), with at the same time an extended “theoretical duration of compensation” (14 months on average against 11 before the reform). The Ministry of Labor disputes this figure, stressing that it does not take into account the improvement in the economic situation, nor the “behavioral effects” hoped for from the reform.

If Michel Beaugas sees “no reason to be pessimistic” about the SJR, the rest of the reform, namely the hardening of the rules on the degression of benefits and on the duration of affiliation necessary to open or recharge a right, has so far not been called into question by the Council of State.

If the conditions for improving employment are met on December 1, as is likely, the membership period will then be reduced from 4 to 6 months. And the decrease of 30% for benefit recipients under 57 years of age who have lost remuneration greater than 4,500 euros gross monthly will apply to the 7th month of compensation and no longer to the 9th.