The minister of Labor, Jean-Pierre Farandou, is exploring a "fundamental reform" to address "general exemptions," which are reductions in employer social contributions on low wages. He discussed this during a meeting with the Commission on Social Affairs of the National Assembly on Wednesday. The government's proposed budget for the Social Security (PLFSS) for 2027 includes measures to slow the rising cost of these exemptions, which, despite a reform in 2025, have grown significantly, reaching levels much higher than before the post-COVID inflationary period, as noted in the bill. In addition to these measures, Farandou mentioned he would form a working group to examine general exemptions further. He emphasized that these exemptions amount to 75 billion euros annually, significantly impacting labor costs by reducing the cost of low wages. However, he warned of a drawback: these exemptions can create a "minimum wage trap," where employers are less inclined to increase wages, as the reduced cost of hiring low-wage workers becomes a disincentive for raising salaries. Even employer associations have acknowledged this issue, and Farandou said they were open to discussing a comprehensive reform. Farandou also sent a letter to social partners on Wednesday, urging them to "come together around a table" to identify one billion euros in savings related to sick leave. He defended the government's plan to freeze or partially freeze pensions for retirees in 2027, except for those earning 1,260 euros or less. He explained that indexing pensions to inflation since 2020 has cost 50 billion euros in 2027 alone, and the savings goal of 5.5 billion euros is seen as reasonable. For after 2027, the PLFSS proposes a system for annual pension negotiations with social partners. Farandou suggested that companies, which pay employer contributions, and employee unions, which pay employee contributions, should be involved in these discussions. However, he emphasized that the final decisions would remain with the State, which would take responsibility for ensuring the system's stability.