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

New episode in the Unemployment Insurance soap opera this Thursday. In this battle between the executive and the unions, the Council of State will have to say whether or not to suspend the decree which modifies the rules for calculating the daily reference wage (SJR) used to determine the amount of allowances. Decree published on September 30 which in principle must apply from October 1.

All the major confederations have seized the highest administrative court in summary proceedings. As in June when they won their case, the unions hope to obtain a suspension of this decree in the coming days pending a hearing on the merits to be held within a few weeks.

In June, the Council of State, which had not called into question the principle of the reform, had put forward “uncertainties about the economic situation” in the midst of a pandemic to suspend the application of these new rules which will penalize the compensation of claimants. of employment alternating periods of work and inactivity.

“A passage in force of the government”

Immediately, the government issued a new decree, identical to the previous one with simply an entry date postponed to October 1, estimating that the situation was different with “the sharp rebound in employment since May” and a number of unemployed who fell. is approaching its pre-crisis level.

According to the executive, these new rules are intended 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.

The lawyer of the CGT, Maître Antoine Lyon-Caen denounces “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 force “. “He should have asked the Council of State beforehand to review his June ordinance by showing him that the situation had totally changed,” he explains.

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. Except that the government estimates for his part, the “observation period” for companies to calculate this modulation has already started on July 1, 2021. The fact remains that Michel Beaugas, the FO negotiator wants above all a questioning of this reform which he considers unfair.

In principle, the calculation of unemployment benefit is now based in this decree on the average wages received over a period of 24 months preceding unemployment, and no longer on the only days worked during a period of 12 months.

1.15 million people affected by a lower monthly allowance

Since July 1, 2021, an allowance degressivity measure already applies to beneficiaries affected by a certain level of allowance (€ 85.18 per day) after a period of 8 months of compensation (243 days) at the 6 months (182 days) as initially planned when the measure first came into force on November 1, 2019. The payment of the benefit before degression, that is to say at the full rate, is reduced to 6 months when the indicators of a return to better fortunes in the labor market will be reached. Which will probably be the case in December.

However, 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 disputed this figure, stressing that it did not take into account the improvement in the economic situation, nor “behavioral effects” hoped for from the reform.

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