Monday, March 6, 2017

Unemployment benefits for the self-employed?

Among one of the more interesting proposals put forward by one of the French presidential contenders - Emmanuel Macron - is a scheme to protect the self-employed enabling them to access unemployment and sickness benefits in much the same way as an unempoyed person who has lost his/her job.

If you are employed in France on a fixed-term conract (CDD) or an open-ended 'permanent' job contract (CDI) both employer and employee pay a social contribution among many others, which covers the cost of unemployment benefits in the event of loss of the job. Benefits are calculated on how long you have worked/contributed and the maximum period of payments is normally 24 months, during which you can/must actively seek another job.

Being employed or unemployed is generally clear-cut - you either have a job or you don't. Being self-employed generally means you have to work harder and for longer hours (I can testify to that!) but there is no routine protection against loss of work or income brought about by economic circumstances or simply the loss of a valuable client or contract, and other factors beyond your control.

While I was self-employed in Britain for many years, I found it relatively easy to find a private insurance policy that would provide cover in the case of injury that prevented me from working; but insurers would not cover sickness - on the ground that I could feign illness during hard times and claim cover. Like other elf-employed I paid insurance contributions based on a percentage of my net earnings after costs claimed, which rose as my income increased and included state pension contributions.

What Macron is proposing for France  is a payment (out of earnings) by each self-employed individual that would be less than the current (high) 6.4% paid by the self-employed, against 2.4% by empyees. He is not suggesting that the self-employed should pay the equivalent of the cuombined contributions (emplyer/employee) but a reduced personal contribution of 4.6% - the remainder coming from 'general funds'.

It is an interesting idea and would require clear-cut guidelines as to when a self-employed person is out of work or not. One of the secrets of survival if you are self-employed, but not an estabished professonal such as a doctor or a lawyer,  is to have a mix of clients and several sources of income, so that the loss of a one client does not force the collapse of your enterprise. Half the fun is the uncertainty according to a book published in 2009 by Anne and Marine Rambacj entitled 'Les nouveaux intellos précaires'  which describes the precarious lives of many in the arts and intellectual professions (writers, artists etc) in France (Editions Stock, 2009).

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