Advance payment refers to the payment of unemployment benefit without a decision. Unemployment benefits, such as earnings-related daily allowance, are always applied for retrospectively, so we actually never pay an advance, meaning in advance concerning unemployment or lay-offs. "Advance payment" means we can pay before making a decision. This is useful if we can see that there are no obstacles to payment and that the conditions are in order, but some small matter is waited for. In these cases, we can pay without a decision, meaning you receive payment quicker. When everything is eventually collected, we can give the actual decision. In this context, we also correct the payment if necessary.
According to the Unemployment Security Act, we can pay unemployment benefit in advance without a decision to a person entitled to earnings-related daily allowance. There are no legal provisions for the payment of advance payment as to the circumstances in which the advance payment can or cannot be used. The payment of the advance payment is therefore entirely at the discretion of the payer. The law instructs that the advance payment be paid on the basis of the application.
Under normal circumstances, the advance payment can be paid for a maximum of two months. Exceptionally, during the coronavirus epidemic, the advance payment may have been paid for a maximum of six months. In addition, during the coronavirus epidemic, the unemployment fund has also been able to pay in advance on its own initiative.
If we pay earnings-related daily allowance without a decision, we will deduct this when we later grant the earnings-related daily allowance by decision.
According to the act, we can deduct the amount of the overpaid benefit paid in advance from the earnings-related daily allowance which is granted later. In order to avoid this, we will, as a rule, pay the amount of the advance payment at the amount of the basic unemployment allowance. This way it is more likely that when we eventually issue a decision, we can compensate you for the underpaid benefit.
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Typically, we have all the information needed to grant the benefit within a reasonable time, so we rarely use a advance payment. The downside of a advance payment is that it requires us to work twice as hard and can even lead to a claim for recovery. Therefore, advance payment is only a little-used possibility.
Initially, the advance payment was created in situations where, for example, the necessary salary information has not been available, although it is otherwise obvious that there are no obstacles to payment and that the conditions are met.
During the coronavirus epidemic, advance payment has become one of the ways in which we secure our customers' livelihoods in a situation where the processing of the application is significantly delayed.