The unemployment insurance scheme is the product of a negotiated agreement between the two sides of industry (national and multi-industry employers' and employees' organizations).
The government then approves the agreement if it is pursuant to applicable law. This approval makes the agreement officially enforceable.
The Unemployment insurance system applies to metropolitan France, the overseas Departments, Saint Pierre and Miquelon, Saint Barthelemy, Saint Martin, and Monaco. It does not apply to Mayotte, which has its own system.
The public employment service is organized around two bodies: the bipartite body UNEDIC (National Professional Union for Employment in Industry and Trade), which will continue to perform its task of administering the unemployment insurance scheme and organizing the benefits payment system, and the service for jobseekers ("Pôle emploi").
Pôle emploi brings all employment services under a single body, with a single point of contact for registering, counseling, training, placing and paying benefits to jobseekers.
The unemployment insurance scheme is financed through contributions paid on earnings: subject to the limit of 4 times the monthly social security ceiling (€13,508 in 2019). As from January 1st, 2019, only employers contribute into the employment insurance scheme. Employee's contributions have been ended, except for short-term contract workers in the entertainment industry (“intermittents du spectacle”), salaried workers in Monaco, and some expatriate employees.
Unemployment contributions are paid to the competent collections agency as determined by the workers' local authority: Urssaf in metropolitan France and the general social security fund (CGSS) in France's overseas departments.
The scheme is applicable to all employees of companies in geographical areas covered by the agreement.
The amount and duration of benefit payments depend upon the period during which the claimant has contributed to the scheme and total contributions paid.
To qualify for unemployment benefit (Return to employment benefit or ARE), the claimant must meet the following requirements:
Unemployment benefits can be stopped if claimants fail to meet their obligations by:
Benefits can be stopped for a period of 1 to 4 months, depending on the reason. Payments can be permanently stopped if the claimant declares false information.
The return-to-work allowance ("Aide au retour à l'emploi"/ ARE) guarantees replacement income to eligible employees who have been involuntarily deprived of a job.
“ARE” rates are calculated partly on the basis of a daily reference wage (SJR). The reference wage is based on gross earnings subject to contributions during the 12 calendar months prior to the last day of paid work (calculation reference period/ “PRC”) up to a limit of 4 times the monthly social security ceiling (€13,508). It is calculated as follows:
*The weighting factor of 1.4, or 7/5, is used to convert the number of days worked to calendar days.
SJR = Reference salary/ Number of days worked during the calculation reference period X 1.4*)
The daily ARE rate is equal to the highest of the following amounts:
This amount cannot be below €29.26 or exceed 75% of the SJR.
Payment begins on the day following the waiting period and any deferred compensation period(s).
The duration of benefit payments is based on the principle of "a day of work equals a day of compensation". The days of work that count toward eligibility are multiplied by 1.4 in order to determine the payment period.
Payment cannot be made for under 122 days or more than:
The May 14, 2014, agreement on unemployment compensation set forth measures that encourage jobseekers to return to work, even on a short-term contract. They are applicable from October 1st 2014. The agreement of April 14, 2017, the majority of the provisions of which are applicable as from November 1st, 2017, preserves these measures.
This program allows a jobseeker who is receiving unemployment benefits to take one or more jobs and perform a total of 150 hours or more of work without losing the entitlements s/he had acquired at the time of his/her first application for benefits. This means that the jobseeker can add the new entitlements earned from a short period of employment onto the entitlements that had not been used when employment was resumed.
Under certain conditions, and as an alternative to roll-over benefits, individuals can choose to receive the benefit to which they are entitled based on their latest period of employment without having to first use up their unused entitlements from a previous period of unemployment. This opportunity can arise when a jobseeker receiving benefits begins a new job that is better paid than the one that entitled him/her to the initial benefits. If the jobseeker uses this ability to choose, s/he permanently gives up any remaining benefits resulting from a previous ARE entitlement in order to draw new entitlements at a higher rate.
For more information, visit the UNEDIC website.
It is possible to receive return-to-work (ARE) benefits at a partial rate on top of earned income, with no consideration for the number of hours worked.
Benefits paid if a salary is being earned at the same time are calculated as follows:
However, this amount is capped: it must not exceed the claimant's daily reference salary (“salaire journalier de reference”/ SJR).
More information is available on the UNEDIC website.