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France Shelves Sweeping Unemployment Reform, Sets Talks on Rupture Deals With €400 Million Savings Goal

If no agreement is reached by the end of January, the labor minister says the state will impose its own measures.

Overview

  • The Labor Ministry told partners it will withdraw the August guidance seeking €2–2.5 billion in yearly cuts once formal interprofessional negotiations start.
  • Unions and several employer groups had urged this path, proposing focused talks on short-term contracts and mutually agreed terminations to restrain benefit costs.
  • The new objective is at least €400 million in annual savings with effects beginning in 2026, tied to a deadline to conclude a deal by late January 2026.
  • Medef rejects limiting the agenda to rupture agreements and may not participate, and L’Humanité reports Medef and U2P do not plan to attend an initial Unédic meeting this week.
  • Unédic recorded about 515,000 rupture agreements in 2024 and €9.4 billion in related unemployment payouts, highlighting why this mechanism is a prime target for savings.