Good to know if your lay-off ends in termination of employment

Some of the lay-offs that started in the spring have lasted until the autumn, and many companies are also currently holding co-operation negotiations. Hence it is possible that for some of you the lay-off ends in termination of employment.

If your lay-off ends in termination of employment, you should mention it in your application for daily allowance. Otherwise you can continue to apply for daily allowance as per normal. You need not make any changes e.g. in the application period.

Pay close attention to the details

When you inform us about the termination of employment, we can take it into account in the processing of your application and check your right to receive earnings-related daily allowance. If you are entitled to receive pay for the period of notice, we cannot pay you earnings-related daily allowance for that period. Please note that the decisive thing is the right to receive pay for the period of notice. It is possible that the employee agrees with the employer that the pay for the period of notice need not be paid, although you were entitled to receive pay for the period of notice according to the collective agreement, employment contract or the law. So we cannot pay you earnings-related daily allowance for the period of notice, even though the employer had not paid the pay for the period of notice or a corresponding compensation. So the decisive thing is the right to receive pay, not whether you have actually received pay for the period of notice or not.

If you do not inform us about the termination of employment, we may pay you daily allowance, although you are not necessarily entitled to receive earnings-related daily allowance. When the matter is disclosed later, we will have to reclaim the excessive amount of daily allowance paid to you. If you have intentionally ignored to inform us about the termination of employment, we will have to file a request for investigation to the police.

Lay-off and period of notice

According to the Employment Contracts Act, during lay-off you can terminate your employment without a period of notice. When you are not entitled to receive pay for the period of notice, there is no hindrance for the payment of earnings-related daily allowance. The TE Office will, however, look into the termination of employment and may consider that there was not a valid reason for the termination of employment. It may result in a suspension period without daily allowance, and we cannot pay earnings-related daily allowance for the suspension period.

The employer may also terminate the employment during lay-off. The employer must comply with the agreed period of notice. The employer may retain the pay for 14 days from the pay for the period of notice, if the employer has used a period of notice of over 14 days at lay-off. So the requirement is that the period of notice for lay-off used has been 15 days or more.

Exception concerning termination of employment by the employee

When the lay-off has lasted for a minimum of 200 days without interruptions, you can terminate the employment without losing the right to receive pay for the period of notice. Then the employer has to pay you compensation corresponding to the pay for the period of notice. For the period that you are entitled to receive compensation corresponding to the pay for the period of notice we cannot pay you earnings-related daily allowance.

The TE Office will investigate the termination of employment also in this case. The decision is always based on case-specific overall consideration, and it cannot be said that there is always an acceptable reason for terminating the employment on the basis of extended lay-off alone. The established view in legal praxis is, however, that termination of employment by the employee after a lay-off that has lasted for 200 days is acceptable, and it has not resulted in a fixed period without daily allowance.

Current topics

Back to the front page of Topical