Permanent Senior Position: What Would The Contract For Experience Valuation Entail?
In early April 2024, the Medef sent a new proposed agreement on senior employment to the trade unions. To keep the most experienced employees in work, this document notably suggests the creation of a senior open-ended contract, under the name "contract for the valorization of experience". We invite you to find out what this new permanent contract would entail.
A lead to promote the employment of older workers
The creation of a "senior permanent contract" has been a path supported for several months by MEDEF to promote employment among those over 55. In this area, France is seen as a poor performer compared to its European neighbors.
In France, the employment rate for those over 55 was 56.9% in 2022 and dropped to 36.2% for those aged 60-64, while it was 82.5% for those aged 25-49.
The average employment rate of older workers is 62% in Europe. France is well below this European average and far from Germany (73%) and Sweden (77%).
A measure that does not have unanimous support.
The creation of a senior permanent contract or other employment contracts specifically designed for seniors is a measure advocated by employers, but it does not have unanimous support among trade unions.
The Confederation of Small and Medium-sized Enterprises (CPME) fears that this measure could increase labor costs and further complicate the issue of senior employment.
Despite the criticisms raised by the unions, Medef has not significantly altered the previous version of its text dating from March 18, 2024. The proposed agreement sent on April 3 still maintains the idea of a specific contract for senior employees.
A contract renamed as the Experience Valuation Contract.
The idea of a permanent contract dedicated to senior workers has been debated for several months now. Initially, there was talk of a 'senior CDI' and then a 'career-end CDI'... The Medef has finally chosen the name "contract for the valorization of experience" to refer to a scheme dedicated to job seekers over 60 years old.
As the final negotiation session on this text is set to take place today, Monday, April 8, 2024, here is what we know about this new contract championed by employers:
- It would be created on an experimental basis for a duration of 5 years.
- The conditions for using this contract could be adapted by a sectoral agreement, particularly to lower the age threshold for accessing this scheme.
- This permanent contract could be terminated by the employer as soon as the employee meets the conditions to receive a full-rate pension.
Under this new employment contract, the company would commit to keeping the employee until their retirement at a full rate and no longer until they turn 70. Indeed, under current legislation, it is prohibited to force an employee to leave their position before reaching 70 years of age.
Upon signing a contract for the valorization of experience, the senior job seeker would be obliged to provide their future employer with the projected date of their full-rate retirement. As a reminder, the automatic age of full-rate retirement is generally established at 67 years or earlier for those who have contributed a sufficient number of quarters.
A senior part-time permanent contract mentioned by Bruno Le Maire
While negotiations between unions and employers regarding the employment of older workers are still ongoing, the Minister of Economy Bruno Le Maire has discussed another measure in an interview with the newspaper Ouest-France on March 30, 2024.
To improve the employment rate of seniors in France, the Minister of Economy is considering creating a "senior part-time permanent contract". This contract would allow those over 55 to work 80% of their time while retaining 90% of their salary and 100% of their retirement rights.
The details of this part-time contract are yet to be defined. According to Bruno Le Maire, this scheme, which would have its cost shared between the state and companies, would help promote the employment of those aged 55-64. However, this proposal does not have unanimous support among unions. The CFE-CGC, a union for executives, stated that "this proposal is a step in the right direction," but there is a fear of a windfall effect for individuals already on permanent contracts who might opt for this scheme.
The implementation of this new part-time contract would lead to the end of specific unemployment benefits for seniors. Until now, those over 55 enjoyed a longer benefit duration of 27 months. The Minister of Economy wants to put an end to this because it amounts to "turning unemployment insurance into disguised retirement."
The social partners, who are negotiating today a "new pact for working life," must agree on the conditions of unemployment insurance for seniors, on the support for the most experienced employees within companies, and more broadly, on the measures to be taken to keep those over 55 in employment.
