Unemployment insurance reform censored again, a huge setback for the government

This is a new episode in the seemingly endless battle waged by the unions against the unemployment insurance reform implemented by the government in 2019.

Unemployment insurance reform censored again, a huge setback for the government

This is a new episode in the seemingly endless battle waged by the unions against the unemployment insurance reform implemented by the government in 2019. Seized by all the trade unions, with the exception of the CFTC, the Council of State decided on June 22. In a decision unveiled at the start of the afternoon, the judge in chambers suspended the new rules for calculating the amount of unemployment benefit which were to come into force on July 1. “The uncertainties about the economic situation do not allow the implementation, on this date, of these new rules which are supposed to promote job stability by making unemployment compensation less favorable for employees who have alternated short contracts and inactivity. On the other hand, the judge does not question the principle of the reform itself", indicates the Council of State in a press release. A huge setback for the government which had already reviewed its copy.

The modification of the calculation of the daily reference wage which serves as the basis for the allowance received by job seekers is at the heart of the fight carried out by the trade unions. And for good reason, if the other measures of the reform will apply when the economic indicators return to good shape, the new daily reference wage was to come into force on July 1. However, it is a source of inequality, the unions have always denounced. In an impact study last March, Unedic calculated that 1.15 million job seekers could see their allowance reduced this year, by an average of 17%.

So far, to calculate it, all salaries over 12 months divided by all days worked are taken into account. Problem: according to the government, this creates windfall effects. At the same salary and hourly volume, a person working part-time every day received a lower allowance than someone working every other day. In its 2019 reform, the Ministry of Labor therefore proposed another way of doing things. It would no longer be based on the days worked over the last 12 months, but on the whole period (days worked or not), going from the start of the first contract to the last day worked in the last 24 months. If the numerator does not change, the denominator may increase. Consequence: it can decrease considerably, and even too much! Already seized by the unions, last November, the Council of State had estimated that the first version presented by the government in 2019 was a source of inequality... The executive had then presented a new formula in the decree of March 30 2021. The fall in the SJR could not exceed 43% of the current calculation... Does this floor cancel out the inequalities in treatment? No, say the unions. It would create huge gaps depending on the order in which people alternate between employment and unemployment, explains Mathieu Grégoire, sociologist at Nanterre, with supporting figures. "By changing the dates of these periods a little, the inequalities of treatment for the same salary range from 1 to 47 depending on whether the period of unemployment straddles two months or not." Points far from being intuitive, that the unions have not failed to put forward.

On the very day of the hearing in the Council of State, the government published a new decree in order to rectify, this time, the fact that the formula penalized job seekers who had experienced periods of partial activity, sick leave or maternity...

For the time being, the new formula of the SJR is in any case suspended. "Excellent news, greets Denis Gravouil, of the CGT for whom the battle will continue." "It's a victory for job seekers who would have been harshly punished by this reform," tweeted CFDT leader Laurent Berger.

Can the other reform measures be undone? This is what the unions are hoping for, having sharpened their weapons and put forward many arguments in this direction. Example: according to them, the economic upheavals have rendered the framework letter framing the reform obsolete (it was based on growth prospects, a drop in unemployment, etc.). In other words: the government should have given them back their hand. If the Council of State followed them, the whole reform would fall at once: degression for executives, increase in the duration of affiliation from four to six months, bonus-malus... The answer n is however not for tomorrow. After this emergency order, the "substantive" appeals against the entire unemployment insurance reform will be judged by the Council of State within a few months... and all scenarios are possible. The soap opera is not over.

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