Employment aspects of the recovery plan

The French government has announced a recovery plan of 100 billion euros over two years. This plan includes an “employment and territorial cohesion” section with specific measures on employment and training, meant to develop the competitiveness of companies and employment, with a stated objective of creating 160,000 jobs in 2021.

The purpose of this alert is to present the employment section of the Government's recovery plan, which is mainly based on short-time work and training.

I. Short-time work

Continuation of the exceptional measures until 31 October 2020 or until the end of the year for sectors subject to particular restrictions

Decree no. 2020-1170 of 25 September 2020 states that the exceptional short-time work scheme put in place at the height of the pandemic crisis continues to apply until 31 October 2020, whereas it was initially due to stop on 30 September 2020. This scheme will continue to apply under the conditions in force since 1 June 2020, i.e. employers pay their employees a compensation amounting to at least 70% of the landmark gross remuneration and employers benefit from a short-time work allowance paid by the State up to 60% of this remuneration or 70% in sectors particularly affected.  

The French Labour Minister also announced on 30 September 2020 that the Government intended to maintain the short-time work allowance without any remaining charge to the employer in all sectors subject to particular restrictions until the end of the year.

Decree no. 2020-1188 of 29 September 2020 removes the two-day period at the end of which, in the absence of a decision, the application for a short-time work authorisation was deemed as accepted. This period is therefore once again extended to fifteen days.  

Standard short-time work scheme (also called “Activité partielle de droit commun” – APDC)

As from 1 November 2020, the exceptional measures should give way to a reformed scheme to meet specific and time-limited needs.  

Standard short-time work scheme allows the employer to reduce the employee’s working hours and to benefit from a compensation paid by the State corresponding to 36% of the employees' previous gross remuneration, up to a limit of 4.5 times  the French minimum wage, with a floor rate set at €7.23 per hour not worked and per employee.

Employees receive a compensation paid by the employer corresponding to 60% of their previous gross remuneration for hours not worked, with a minimum set at €8.03 per hour, up to a limit of 4.5 times the French minimum wage.  

Long-lasting short-time work scheme (also called “Activité partielle de longue durée” – APLD)

The purpose of the long-lasting short-time work scheme is to support companies experiencing lasting difficulties, with the prospect of a more significant recovery in the medium term.  

In order to benefit from this scheme, companies must conclude an agreement at the level of the establishment, company or group or establish a document based on an extended industry-wide  agreement. These agreements can apply for a period of 24 months.  

Authorizations are issued by the administration for a renewable period of 6 months. Before each renewal, the employer must send the administration an assessment of the commitments made by the company, particularly in terms of employment and vocational training, and an updated diagnosis of the company's situation. Employee representatives and trade unions that have signed the agreements must be informed at least every 3 months of the implementation of the agreement and before each request for renewal of the authorization.  

The long-lasting short-time work allows working hours to be reduced by up to 40% of the statutory duration, or 50% in exceptional circumstances. The employer receives a compensation paid by the State corresponding to 60% of employees' previous gross remuneration, up to a limit of 4.5 times the French minimum wage, with a floor rate set at €7.23 per hour not worked.  

Employees receive a compensation paid by the employer up to 70% of their previous gross remuneration with a minimum set at €8.03 per hour and up to a limit of 4.5 times the French minimum wage.  

II. Training

Training is crucial in the recovery plan presented by the Government, whose aim is to redirect job seekers and young people towards the new professions of the future.

Training aid from the National Employment Fund (also called “FNE-Formation")

The training aid from the National Employment Fund concerns employees placed in short-time work under standard or in long-lasting short-time work schemes. The State covers part of the educational costs of the training project. The purpose of this training is to strengthen the employability of the employee by making the most of his idle time, but also to help the company improve its competitiveness.  

The training aid from the National Employment Fund consists of an agreement between the State and the company. All companies are eligible, regardless of their headcount.  

Only training enabling employees to improve their employability in a context of economic change is financed under this scheme, which excludes mandatory training at the expense of the employer.  

For employees in standard short-time work schemes, the rate of coverage of educational costs will be 70% as of 1October 2020, compared to 100% currently. For employees in long-lasting short-time work schemes, the rate of coverage is 80%.  

Training in strategic professions

Regarding training in sectors considered strategic, and if the Personal Training Account (also called “Compte Personnel de Formation” - CPF) does not cover the entire training amount,  the recovery plan provides for a 100% financing of the remaining amount to be paid for a specific training. for

Strategic sectors are:  

- digital sector;

- ecological transition sector;

- industrial sectors concerned by the issue of economic sovereignty and relocation of production.

Digitalization of professional training

The digitalization of vocational training is taking place through two types of measures: the creation of new educational content and the development of remote learning (also called “formation ouverte et/ou à distance” - FOAD).  

Regarding the creation of new educational content, two types of measures are provided:

- The generalization of the equipment of all training organizations with a digital platform and the provision of a public service solution to training organizations and apprentice training centres.

- The design of hybrid training courses, using digital modules, enabling the learning of professional actions online thanks to virtual reality, in priority in strategic fields.  

As far as remote learning is concerned, the recovery plan provides for an expansion of the existing national market for remote learning to increase the potential of distance learning offers.

Supporting career plans

The recovery plan emphasizes professional retraining and promotion through work-study programs, known as "Pro-A". The aim of this program is to encourage major retraining in order to allow mobility between sectors of activity, particularly for employees most exposed to the risk of unemployment.  

The Pro-A program will be used in the industry sectors in which the program is provided by collective-bargaining agreement.  

The recovery plan also provides for an increase in the remuneration of jobseekers in training and the introduction of a €150 training entry bonus.

Other measures

The recovery plan provides to ensure that France Compétences (national governance body for vocational training and apprenticeship) is able to finance professionalization contracts, apprenticeship contracts and promotion through work-study programs thanks to an exceptional endowment of 750 million euros in 2021.  

The plan also provides for a grant of 250 million euros to enable the French Unemployment Agency (Pôle Emploi) to hire 1,500 counsellors to help prevent the increase of job seekers.