Actance Tribune
What's NEW under French Employment Law?
N° 33 – December 16, 2024
French Unemployment Insurance: A Focus on New Provisions Adopted by Social Partners
On November 14, social partners reached a new agreement.
In France, the unemployment benefits system can be established through an agreement negotiated by social partners (known as “National Interprofessional Agreement”). To become effective and enforceable, this agreement must be approved by the French Prime Minister through a process known as “agrément”.
If the government refuses to grant the “agrément”, it sets the rules for unemployment insurance rules through a decree approved by the Conseil d’Etat.
As a reminder, a first agreement had been concluded in November 2023 for a four-year term but the previous government did not grant the “agrément”. The primary reason mentioned was that the agreement insufficiently addressed the need to increase the employment rate among senior workers.
This new agreement from November 14, is expected to be endorsed by most social partners and subsequently approved by the executive branch to take effect on January 1, 2025.
However, for operational implementation reasons, the entry into force of certain changes is scheduled for April 1, 2025.
But what are its key provisions?
- Senior Unemployment Benefits: In France, unemployed seniors receive benefits for an extended period. Previously, eligibility for this extended period was reserved for seniors aged 53 years old (22,5 months of unemployment benefits) and 57 years old (27 months of unemployment benefits). However, following the 2023 pension reform, which raised the legal retirement age from 62 to 64, these age thresholds will now be shifted by two years. Consequently, the thresholds granting entitlement to 22,5 and 27 months of unemployment benefits will now apply at ages 55 years old and 57 years old, respectively.
- Eligibility for First-Time Job Seekers and Seasonal Workers: The minimum period of employment required to qualify for unemployment insurance benefits is reduced to five months, corresponding to 108 working days or 758 hours. Similarly, the minimum benefit duration is also reduced to five months.
- Residency Requirement and Concurrent Foreign Employment: Individuals receiving unemployment benefits (“ARE” Aide au Retour à l’Emploi, in French) must reside in France for more than six months during the benefit payment year. Furthermore, starting April 1, 2025, the combination of ARE benefits with income derived from professional activities conducted abroad will be limited to a maximum of three months.
Minimization of Data Disclosed to the Employee to Prove Discrimination: Reminder of the Judge’s Role
In a ruling by the Second Civil Chamber of the highest court in the French judiciary (“Cour de cassation”, Cass. 2e civ. October 3, 2024, n° 21-20.979) — the chamber, which handles civil procedure disputes — the high court outlined the duties of judges in cases where an employee requests disclosure of other employees’ payslips to substantiate claims of discrimination (notably union-related discrimination).
The disclosure of other employees’ payslips in such disputes has already been deemed consistent with the respect owed to their private lives (Cass. 1ère civ., February 25, 2016, n° 15-12.403).
More recently, the Cour de cassation had also ruled that the right to the protection of personal data is not an absolute right and must be balanced against other fundamental rights, in accordance with the principle of proportionality (Cass. soc., March 8, 2023, n° 21-12.492).
However, the Court now emphasizes the obligation for judges to ensure that such disclosure complies with the General Data Protection Regulation (GDPR, in French “RGPD”), particularly the principle of data minimization. This principle requires the redaction of non-essential information, or even pseudonymization, and restricts the use of such documents to the specific legal action at hand.
This reasoning aligns with the jurisprudence of the Court of Justice of the European Union (CJEU, March 2, 2023, Case C-268/21, Norra Stockholm Bygg v. Per Nycander).
Indeed, protecting the rights of employees affected by the disclosure request — who are, in fact, third parties to the dispute — requires strict and step-by-step judicial oversight.
The Cour de cassation provides a practical framework for the judge’s duties.
When faced with a request to disclose documents containing personal data for the purpose of substantiating (and remedying) a claim of discrimination, the judge must:
- Determine whether the disclosure is necessary to exercise the right to provide evidence of alleged discrimination and if it is proportionate to the objective pursued.
- Evaluate whether the requested disclosure could infringe on the privacy of other employees.
- Consider whether there are legitimate grounds to retain or establish evidence of facts, even before litigation, that could determine the resolution of the dispute
- If the above criteria are met, the judge must:
- Restrict, if necessary, on its own, the scope of the requested document production.
- Ensure adherence to the principle of data minimization by ordering, if necessary, on its own, the redaction of all non-essential personal data from the documents to be disclosed by the employer.
- Verify that any information specified to remain visible is adequate, relevant, and strictly limited to what is indispensable for comparing employees, taking into account the alleged grounds of discrimination.
- Instruct the parties to use the disclosed personal data solely for the purposes of the discrimination claim.
It should be noted that in discrimination cases, the burden of proof is adjusted: the employee must first present factual evidence that suggests discrimination, after which the employer must prove that their decision was justified by objective factors unrelated to discrimination (Art. L1134-1, French Labor Code).
The national interprofessional agreement on the employment of Seniors
France has one of the lowest employment rates for seniors (over 55 years old) among the OECD countries.
While the law of April 14, 2023 enacted a progressive two-year delay in the legal retirement age (now set at 64 years for the employees born on after January 1, 1968), the the government invited social partners to propose specific measures for this category of employees.
It is in this context, that a draft agreement was concluded on November 14, 2024, providing measures aimed at maintaining or promoting the return to employment of experienced employees.
This agreement was signed by four out of five employee unions and all employer organizations. The government had committed to transpose quickly the agreement into law before its dissolution,. When a new government is appointed, this national interprofessional agreement is expected to be the basis for a bill implementing its provisions.
The measures contained in the agreement are structured around four thematic areas:
A strengthening of collective bargaining at the company level on the theme of senior employment
The agreement introduces a mandatory and specific negotiation on:
- The recruitment of experienced employees
- The maintenance in employment and the end-of-career arrangements (gradual retirement and/or part-time)
- The transmission of knowledge and skills (mentoring, tutoring …)
In addition, an optional negotiation may cover topics such as:
- The development of skills and access to training
- The impact of technological and environmental transformations etc…
Enhanced professional reviews aiming to prepare for the second part of the career
Among the measures is also the implementation:
- An interview between 58 and 60 years old, during which the following must be discussed:
- conditions for staying in employment,
- possibilities for end-of-career arrangements
- potential use of progressive retirement
- An interview after 60 years during which the employee can share their expected full pension retirement date and during which the employer will address the possibilities for end-of-career arrangements.
The existing mid-career interview, which takes place in the year preceding or following the 45th birthday, will also be enhanced so that health issues, skills, mobility wishes or actions to prevent professional disengagement are addressed.
Measures to promote the recruitment of senior job seekers through a ‘Skills Valorization Contract’
This contract, which is created on an experimental basis for a period of 5 years, is available to job seekers aged 60 and over registered with France Travail (or 57 years if specified by a collective bargaining agreement).
Benefits are provided:
- For the job seeker who concludes this ‘Skills Valorization Contract’: they benefit from adjusted rules for combining their income and the return-to-employment allowance if their wage is at most 30% lower than that obtained in their previous employment.
- For the employer who hires an employee under a ‘Skills Valorization Contract’: they are recognized as having the possibility to retire the employee once the employee meets all the conditions for a full-rate retirement (without needing the employee’s agreement, which is a change from the current rule).
In the event of retirement under the Skills Valorization Contract, the employer is exempt from the specific employer contribution of 30% on the amount of the retirement indemnity.
Furthermore, the employer benefits from a progressive exemption from unemployment insurance contributions, at the rate of one point per year from the age of 60. However, these exemptions must be reimburse to the unemployment insurance if the employer dismisses the employee before their full-rate retirement unless the dismissal is due to serious or gross misconduct, or economic reasons.
End-of-career arrangements through interlinked schemes to enable job retention
This includes:
- Promote dialogue between the employee and the employer on the expected retirement date,
- Establish part-time work at the end of the employee’s career,
- Improve schemes facilitating the employment/retirement transition:
- Facilitate access and enhance the attractiveness of progressive retirement
- Enhance the attractiveness of the employment-retirement cumulative scheme- retirement.