Activation model to be repealed
The Government has submitted a proposal to Parliament on cancelling the activation model (Government proposal 80/2019). The activation model for unemployment security will become ineffective as of 1 January 2020.
The Government is planning that an amendment of the Unemployment Security Act will enter into force on 1 January 2020 according to which the accumulation of activities required by the activation model will no longer be followed, and it will not be a condition for the payment of unemployment benefit in full.
The entry into force of the amendment would mean that unemployment benefit would no longer be reduced after 1 January 2020. Similarly, daily allowance reduced before the amendment would again be restored to full allowance as of 1 January 2020.
The removal of the activation model will not affect other conditions of unemployment benefit. An unemployed job-seeker will be obliged to seek for jobs and training in the future, too.
The waiting period at the beginning of employment, for which no daily allowance is paid, will remain at five days.
A positive amendment
YTK considers the amendment a positive one. The activation model is complicated and hard to understand both for the payer and recipient of unemployment benefit. In addition, the seekers of benefit see it as unfair. It treats applicants differently depending on e.g. the applicant’s place of residence or age.
In YTK, the introduction and application of the activation model caused extra work at advisory services and in processing of benefits due to the hard-to-understand and bureaucratic nature of the law. Implementation costs accumulated from system changed and training.
During the period of validity of the law, up to the end of August 2019, approximately 51 per cent of YTK’s benefit recipients fulfilled the activity requirements. Around 49 per cent of the benefit recipients did not fulfil the activity requirements. During the period of validity of the law, the share of those who fulfilled the activity requirements has decreased. In 2018, after the first review period, 53.5% of benefit recipients fulfilled the activity requirements and 46.5% did not. YTK has issued over 81,000 decisions on reduction of daily allowance.
The situation of unemployed persons should be taken better into account in legislative work
Legislation on the activation model is a prime example of complicated legislation, the kind of which the people who apply the law do not want in terms of enforcement of the law. From the recipient’s point of view the law was unreasonable, and it treated unemployed persons in different situations unequally. It would be good, if the effect of the legislation on the situation of the unemployed person and the fairness point of view were better taken into account in the drafting of unemployment legislation in the future.