Partial unemployment

Coverage extends to the following situations:

• a down-turn in economic cycles;

• provision difficulties related to raw materials or energy;

• transformation, restructuring or modernisation of the enterprise;

• exceptional natural disasters and other crises.

Reduction in economic activity must be a temporary situation. All employers and all employees (both blue and white collar) can benefit from the scheme. This includes part-time employees who work, on average, less than 18 hours per week, employees on fixed term contracts and employees on temporary agency contracts. Some categories of workers are excluded from the scheme: seasonal workers, those who are not unemployed because of strike, those suspended from the activity for longer than six weeks, and workers for whom working time is counted in hours or days.

This system allows companies experiencing difficulties to temporarily reduce weekly working hours by drawing on state subsidies to help pay employees’ wages which otherwise would be subject to a reduction. Employees who are placed under the partial unemployment scheme remain under the authority of the employer - the employment contract is not terminated. The employer can ask the the employee at any time to resume normal working hours without having to recruit them again. Affected employees receive a compensation for the loss of income resulting from working time reductions and the employer is partially reimbursed by the government upon submission of a summary statement. This indicates the actual use of partial unemployment and the number of employees that have benefited from the scheme.

The employer must pay at least 60% of the gross hourly pay (or 75% if the reduction in activity lasts three months or over), for up to one year. This is for a maximum of six consecutive weeks, or 8,000-10,000 hours a year per worker. To partly offset this cost, the employer receives a state allowance, the amount of which varies depending on the size of the firm’s workforce; since January 2009, enterprises with up to 250 employees receive €3.84 per hour, while larger enterprises receive €3.33 per hour. It is considered a serious offence (‘faute grave’) for the affected employees to refuse to be placed under the scheme, thus refusing a reduced salary. In such cases, the employer could proceed to layoffs and their obligation to pay other social contributions on non-worked hours is waived. In the event that the affected employee is laid off following the reduced time working period, unemployment benefits are calculated on the basis of the full-time wage before working hours were reduced. Affected employees also keep full rights to their pension entitlements and, under certain conditions, may acquire free retirement credits (‘points gratuits’) towards a complementary pension scheme. Workers who are impacted by this measure benefit from increased access to training and various combinations of training schemes, depending on the number of hours worked and the length of the short-time work period.

National government
Funding; authorisation by the state required; responsible for the implementation, monitoring and evaluation of the partial unemployment scheme

Employers' or employees' organisations
In order to avail of the partial unemployment support, the company has to consult its works council or employee representative and subsequently apply for an authorisation with the departmental units responsible for employment and vocational training which

Other
national; employer

Regional/local government
national; employer

Employer

National funds

Demand for this scheme has increased since the recession began; an average of nearly 189,000 employees were in a situation of partial unemployment in any given week in 2009. Overall, it is estimated that in 2009, over 400,000 individual employees have benefited from this scheme. Research carried out on over 36,000 French companies (with at least 50 employees) using partial unemployment between 1996 and 2004 has shown that participation in the scheme does not reduce layoffs as a consequence of short-term economic downturns. This is especially so in cases of long duration of partial unemployment (Calavrezo et al, 2009). In addition, the uptake of partial unemployment tends to be an early indicator of dismissal that will follow. These results do not necessarily suggest that partial unemployment is an inefficient job security policy instrument. It may be the case that short-time working and layoffs play a complementary role to each other in addressing temporary economic difficulties.

Employees’ entitlements to unemployment benefits and future pension are not negatively affected in situations where they have been placed under the partial unemployment scheme. A good level of consensus between the social partners has facilitated the implementation of urgent measures in response to the global recession. Finally, the scheme provides affected employees with the right to training days provided by different employers.

Employers must wait for a period of two to three months before they are notified of the outcome of their application. In addition, the integration of the partial unemployment scheme with training has not been fully achieved; the two systems remain separate. Limited research has been conducted on the impact and effectiveness of the partial unemployment scheme.

PSA (four plants), Renault (three plants), Renault Trucks (three plants), Sonas Automotive (two plants), Bridgestone, Toyota, LME, Oxford Automotive, GM, Bosch, Rhodia, Michelin, STA, MPAP, Philips, NTN, Valeo, Ford, Solutions plastiques, Faurecia, Lear, Mefro and Buisard .

http://www.travail-emploi-sante.gouv.fr/informations-pratiques,89/fiches-pratiques,91/chomage,125/le-chomage-partiel,1139.html

Triomphe, C.E., Teissier, C., Goryacheva, A. National background paper France. Anticipating and managing restructuring in enterprises: 27 national seminars. ARENA Report. Brussels, European Commission, 2009; http://www.cfdt.fr/rewrite/article/19103/actualites/le-chomage-partiel,-comment-ca-marche.htm?idRubrique=6864; Calavrezo, O., Duhautois, R., Walkowiak, E. The Short-Time Compensation Program in France: An Efficient Measure against Redundancies? Centre d’Études de l’Emploi, Document de travail 114, February 2009; Mandl, I., Storrie, D., Hurley, J., Mascherini, M., Broughton, A., Owczarzak, R., Riso, S., Salvatore, L. Extending flexicurity – The potential of short-time working schemes: ERM Report 2010.Eurofound. 2010; Voss, E., Wild, A., Pulignano, V., Kwiatkiewicz, A. and Farvaque, N. Organising Transitions in response to restructuring. Study on instruments and schemes of job and professional transition and re-conversion at national, sectoral or regional level in the EU. DG Employment, Social Affairs and Equal Opportunities, Brussels, 2010; http://www.travail-emploi-sante.gouv.fr/informations-pratiques,89/fiches-pratiques,91/formation-professionnelle,118/le-conge-individuel-de-formation,1070.html#sommaire_4; http://www.travail-emploi-sante.gouv.fr/informations-pratiques,89/fiches-pratiques,91/chomage,125/le-chomage-partiel,1139.html.