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French workers to work an extra year to qualify for full pension

French workers walk in the streets of Paris during their lunch break. Flickr/CC/ Diego López Román

After eight months of tough negotiations, employers and trade unions struck a deal on Friday to raise the contribution period necessary for workers to get their full rate pension. From 2019, employees will be encouraged to work longer using a new bonus-penalty system, which could see them receive bonuses of 10 to 30% for working extra.

The text was signed on Friday between France's employer union MEDEF and three of the main trade unions: CFDT, CFTC and CFE-CGC. It aims to inject money into the country's fledgling pension system by giving retirees more flexibility to work beyond the retirement age -currently fixed at 60 and 62 - and this, to ensure they get a full-rate pension.

"It's a good deal for all the signatories concerned, since there are six of us involved," Claude Tendi, a mediator for Medef, told reporters.

The new measures would allow the country to generate 6.1 billion euros worth of savings.

"Encouraging workers to work longer, and creating a flexible retirement system (...) was my aim all along," he added.

Tendi's enthusiasm in having "broken the taboo" on France's beloved social security system, was not shared by all participants.

Two workers' unions: CGT and Force ouvrière, who equally took part in Friday's talks, refused to sign the deal out of concern it would pave the way for France to raise the retirement age.

Under the new complementary retirement package, employees could receive a 10% bonus if they stayed in employment a further two years. And bonuses could reach as much as 30% for an extra four years in work.

On the other hand, if they don't meet the requirements for a full pension, they will be slapped a 10% reduction on their complementary pension.

"We haven't heard the last of this text," warned Eric Aubin of the CGT union, who qualified it as a "step back."

For the time being, the measures apply only to workers in the private sector.

The deal is set to be finalised in the coming days.

With AFP