Conditions for earnings-related allowance

In order to be entitled to earnings-related unemployment allowance, you must meet the membership and employment conditions. You must have been

  • a member of the unemployment fund for at least 26 weeks
  • and have worked for at least 18 hours a week for 26 calendar weeks (Mon–Sun).

Membership condition

In order to meet the membership condition for earnings-related allowance, you must have been a member of an unemployment fund for at least 26 weeks.

You can transfer membership and employment condition credits from another fund to IAET-kassa, if you join within 1 month from leaving the previous unemployment fund.

Employment condition

In order to be eligible for an earnings-related allowance, you must fulfil the employment condition of 26 calendar weeks (about 6 months). Employment can be counted towards the employment condition if

  • the working hours are at least 18 hours per calendar week (with the exception of teachers and periodical work)
  • the work is performed within an employment relationship
  • the work is insured (taxes, unemployment insurance premiums, and social security contributions are paid from the wages or salary)
  • the pay for full-time work is at least the rate specified in the relevant collective agreement or €1,189 in 2018.

The employment condition must be met within the review period of 28 months (2 years and 4 months). The review period is calculated backwards from the date on which you registered as an unemployed jobseeker with the TE Office.

The review period can be extended for up seven years for periods during which you are absent from the labour market for an acceptable reason. This means that your employment condition must be met within 9 years and 4 months if you are absent from the labour market for an acceptable reason.

The condition can be met with several employment periods with different employers, and there may also be weeks in between with less than 18 hours of work.

You can only fulfill the employee’s employment condition by working for someone else while being a member of an employee unemployment fund. As an entrepreneur, you can meet the entrepreneur’s employment condition while being a member of an entrepreneurs’ unemployment fund. If you work as a managing director of a limited liability company, fulfillment of your employment condition depends on if you work as an entrepreneur or salaried director.

Employment abroad and wage subsidy work can also be counted towards the employment condition. Work invoiced via a cooperative does not meet the employment condition, because it is considered entrepreneurship in the Unemployment Security Act.

Note that you will lose any accrued employment condition if you are away from the labour market for more than 6 months without an acceptable reason. In this case, you will have to accumulate your employment condition anew after your absence before you will be entitled to earnings-related allowance again.

Re-fulfilment of the employment condition

When you receive unemployment allowance, every week that meets the employment condition is counted towards a new employment condition. The unemployment fund records such weeks in your employment register. Your employment condition will be re-fulfilled when you have worked for at least 18 hours a week for 26 calendar weeks.

When you have re-fulfilled your employment condition,

  • the amount of your allowance will be re-calculated
  • a new 5-day waiting period will be set
  • the maximum allowance payment period will be reset.

If your employment condition is re-fulfilled within 1 year,

  • the amount of your allowance will not be re-calculated
  • a new 5-day waiting period will not be set
  • the maximum allowance payment period will be reset.

1. Recalculating the amount of your allowance

The amount of your allowance is calculated on the basis of the income from the work that fulfilled your employment condition. When the amount of your allowance is re-calculated, your new allowance will be at least 80% of your old allowance, on condition that your employment condition is met before you have been paid an allowance for the maximum period. You need to have been paid at least 1 day of the old allowance for the rule to apply.

The amount of the allowance is not re-calculated if the new maximum payment period for your allowance begins within 1 year from the start of the previous maximum period and the allowance was calculated at the time.

This is also the case if you re-fulfil the employment condition after turning 58 or in obligatory employment. In these cases, the amount is only re-calculated if your pay is greater than the pay on the basis of which you were last paid daily allowance.

2. New 5-day waiting period

A new 5-day waiting period is set when the employment condition is met. The waiting period is equivalent to 5 full working days and it is spent at a rate of 5 days per week.

The 5-day waiting period is not set again if the new maximum payment period for your allowance begins within 1 year from the start of the previous maximum period and the waiting period was applied at the time.

3. Resetting the maximum period

The maximum payment period for earnings-related allowance is always reset when the employment condition is fulfilled.