Winter will bring amendments to law

A few amendments to the Unemployment Security Act will enter into force as of the beginning of 2020. In addition, unemployment funds will start to use the Incomes Register at the turn of the year.

This will happen

  • The activation model will be repealed and discontinued

  • Earnings-related daily allowance will increase by a couple of euros

  • The right to additional days will be updated

  • The Incomes Register will be taken into use in the unemployment fund

Activation model will be repealed

An amendment of the Unemployment Security Act will enter into force on 1 January 2020 as a result of which the accumulation of activity required by the activation model will no longer be followed, and it will no longer be a condition for receiving unemployment benefit in full.

The entry into force of the amendment means that unemployment benefit will no longer be reduced as of 1 January 2020. Similarly, daily allowance reduced before the amendment will be restored to its full amount as of 1 January 2020.

The elimination of the activation model will not affect other conditions of unemployment benefit. Unemployed job-seekers will be obliged to search for work and training in the future, too.

The waiting period at the beginning of unemployment for the duration of which no daily allowance is paid will still be five days.

Level of earnings-related daily allowance will rise

An increase in the amount of basic daily allowance will enter into force as of 1 January 2020. The adjustment will affect the amounts of earnings-related daily allowance and the alternation compensation in accordance with the Act on Job Alternation Leave. The effect on the amount of earnings-related daily allowance will be small, around 1–2 euros per month.

The increase will be implemented so that the amount of basic daily allowance will be raised by 20 euros per month at the turn of the year. In practice, it means that the amount of basic daily allowance will be set at 33.33 euros per day in a section of the Unemployment Security Act.

The amount of the basic daily allowance is tied to the national pension index. After the increase, the amount of basic daily allowance prescribed by the law corresponds to the value of the national pension index for 2019. When the increase enters into force on 1 January 2020, it will be adjusted by the national pension index for 2020, and thus the basic daily allowance for the next year will be 33.66 euros.

When the basic daily allowance is adjusted, the earnings-related daily allowance will be recalculated. The effect on earnings-related daily allowance will be on average around 1–2 euros per month.

Right to additional days will be updated

The right to additional days will be updated at the turn of the year. In practice, the next age group i.e. those born in 1961 or later will be added to the Unemployment Security Act.

In conjunction with the amendment on additional days, the maximum age for receiving earnings-related daily allowance will be adjusted in such a way that job-seekers born in 1965 or later will receive earnings-related daily allowance at most to the end of the calendar month in which they fulfil the lowest age for old-age pension referred to in the Employees Pensions Act.

The amendment of the Unemployment Security Act follows here the raising of the lowest age for old-age pension. The purpose is to prevent a situation in which the right to daily allowance ends before the right to old-age pension begins.

In the future, the maximum age limit for earnings-related daily allowance will depend on the person’s year of birth and the Pensions Act. Thus it can no longer be seen directly from the Unemployment Security Act.

Incomes Register will be taken into use

As of the beginning of 2020 we will start to retrieve income information directly from the national Incomes Register. That will decrease the need for separate salary certificates. So in the future we will need fewer attachments to the applications and at the same time we will ask for some more information in the application itself.

We can retrieve income information from the Incomes Register as of 2 January 2020. We will retrieve the information in conjunction with the processing of the applications. At this point, changes in the application process will be minor. The use of the new system and inquiries about missing income information and possible specifications will increase our handling and advisory work at first. Our goal is that it will not affect the payment schedules of daily allowance.

Although we will start to use the Incomes Register at the turn of the year, our online service OmaYTK will continue to request salary certificates as before until early February. We will, however, get your income information from the Incomes Register as well, so it will no longer be necessary to provide a salary certificate. The salary information in the Incomes Register is not always enough, however, and technical problems may occur in the introduction of the service. So please be prepared to send your salary certificate despite the introduction of the Incomes Register.

In February we will update our services. Then you will be able to provide more information in the application and fewer attachments will be needed. Our online service will be completely reformed after the next summer and then applying for daily allowance will become even easier.

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