Will the government give up toughening unemployment insurance?

This weekend, the government accepted the proposal of the unions and part of the employers: a withdrawal of the unemployment insurance reform but under conditions.

The Minister of Labor, Jean-Pierre Farrandou, wrote this weekend to unions and employers. In summary, if they negotiate on terminations and short contracts, if they generate at least 400 million euros in savings, the government will leave it there. In other words, we are abandoning the major reform that we had planned on the rules of unemployment insurance which aimed for 2 to 2.5 billion euros in savings per year by 2029, and even 4 billion beyond.

This letter is a response to the unions and part of the employers, who had proposed to him 15 days ago, to open negotiations on short contracts and conventional terminations, this system which allows a contract between an employee and his employer to be terminated by mutual agreement. The government therefore tells them bankrupt. He agrees to lower his objectives. On the eve of a mobilization of the CGT, he prefers to procrastinate with the unions. And in the middle of a budgetary discussion, he wants to avoid also targeting the Socialist Party. Major unemployment insurance reform is a sticking point.

However, it is not certain that an agreement will be reached even if, in substance, most of the social partners recognize abuses concerning this system. Today, very few employees resign. Many request a conventional termination from their boss to receive compensation but also unemployment benefit. And the 500,000 conventional terminations weigh heavily on the accounts of France Travail, the former Pôle emploi: a third of the money paid each year concerns unemployment benefits after terminations, or 10 billion euros out of the 37 billion paid in total.

However, the negotiation is not won because Medef refuses to stick to negotiations on conventional terminations alone. While taxes on businesses risk increasing, he is campaigning for a much more ambitious reform of unemployment insurance, which would save billions of euros.

And then, of course, the government wants to stick today to a minimum negotiation but with one condition: the social partners have until the end of January to reach an agreement, otherwise, there will indeed be a significant turn of the screw inflicted on the unemployed. Enough to suit Medef, which could therefore have an interest in applying the empty chair strategy, exactly as it is already doing at the social conference on work and pensions.