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Unemployment insurance: has the reform allowed to reduce short contracts?

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Almost two thirds of the companies affected by the bonus-malus of unemployment insurance will see their contributions reduced as of this September.

Has the unemployment insurance reform made it possible to limit the use of short contracts? As a reminder, which entered into force in 2021, the bonus-malus against precariousness was the component for companies of the tightening of the rules to compensate the unemployed. The current average unemployment contribution rate is 4.05% of the payroll.

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Specifically, to prevent the massive use of short contracts, the reform provides for a penalty for companies that abuse them (an increase of up to 5.05% in the contribution rate) and a bonus for virtuous entrepreneurs (a lowered to 3%).

This system, which was initially intended to affect all companies with more than 11 employees, was eventually limited to 18,000 due to hiring difficulties in many sectors since the end of the health crisis. For a year, the services of the Ministry of Labor have been observing the separation rate of each company (end of contract or temporary transfers), comparing it with the average for the sector and applying the new contribution rate.

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As of this September, therefore, some companies will have to pay more, others will see their rates reduced. And the first assessment will be positive for most of them. According to Les Echos, of the 18,000 affected companies, almost two thirds (63%) will see their contribution rate decrease this September. Instead, 36.4% of them will have to pay more contributions. Otherwise, during this observation period, most companies tended to reduce the use of short contracts.

Less precariousness thanks to the reform?

A balance that differs according to the sectors of activity. It is in the food industry where we find the highest proportion of virtuous companies. Almost 75% of entrepreneurs in this sector will benefit from a bonus. It is followed by the wood and paper sector (66% subsidized), transport (62.5%) and hospitality (60.7%). On the contrary, in water and sanitation production (50.5%), as well as in the so-called scientific and technical activities sector (46.4%), the proportion of virtuous entrepreneurs is the lowest.

Figures, however, to relativize, since the sample is small at the moment. The 18,000 companies monitored affect only 1.3 million employees. The restaurant sector is almost completely excluded from the scope with only 120 companies monitored.

If this first assessment is quite positive and shows a decrease in precariousness in most companies, it is difficult to attribute it to the 2021 reform. For more than a year, hiring difficulties have been growing in the country and many companies must improve . their conditions in terms of remuneration as well as the quality of the contracts to attract candidates for employment. The evaluation will last for another year before eventually being rolled out to more companies.

Author: Frederic Bianchi
Source: BFM TV

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