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Unemployment insurance: the French reform inspired by the Canadian system

The modulation of the rules for compensation for jobseekers in accordance with the economic situation, which was introduced with the government reform presented yesterday, was inspired by what has been practiced for a long time in Canada. This system was created in 1978 by Prime Minister Pierre-Eliot Trudeau – father of the current Prime Minister Justin Trudeau – this system is regionalized, that is, every month, in each of the economic regions, the unemployment rate establishes the “variable standard of availability” , calculated by Statistics Canada. Furthermore, if this employment insurance is administered by the federal government, it is financed solely by employers and employees.

If France has maintained the principle of tightening the rules when the unemployment situation improves and relaxing the rules if the situation worsens, it has abandoned the Canadian regionalization, which would be too complex to implement, even if it is much fairer.

An imperfect system

However, the Canadian model is not necessarily a panacea. If it is well regionalized, the unemployment rate is an average which can mask very large differences depending on the activity sectors and erase the specific characteristics of certain occupations. This system can also be a factor of deep injustice when two neighboring unemployed workers living on opposite sides of a regional border receive different benefits when they had similar jobs. The layout of the regions is also the subject of political controversy.

The system also penalizes the self-employed, the “hybrids” who combine multiple contracts and part-time workers, two-thirds of whom are women, because they must accumulate more hours to be eligible for insurance.

Some, such as the Montreal Unemployment Action Movement, therefore advocate standardization with universal employment insurance.

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