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Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for measure FI-2020-17/546 – Updated – measures in Finland

Cancellation of the unemployment allowance deductible period in the case of temporary layoff or dismissal

Lomautuksen tai työttömyyden perusteella maksettu perus-tai ansiopäiväraha ei väliaikaisesti kerrytä työttömyypäivärahan enimmäismaksuaikaa

Country Finland , applies nationwide
Time period Temporary, 20 April 2020 – 31 December 2020
Context COVID-19
Type Legislations or other statutory regulations
Category Income protection beyond short-time work
– Income support for unemployed
Author Amanda Kinnunen (Oxford Research) and Eurofound
Measure added 13 April 2020 (updated 10 July 2020)

Background information

In accordance with section 6 of Unemployment Security Act (Työttömyysturvalaki) (1290/2002), the basic or earnings-related unemployment allowance is limited to 300-500 days. After this period, job-seekers will receive labour market subsidy.

As a result of changes in the market situation caused by the outbreak of COVID-19, the Parliament has accepted a temporary amendment that cancels the unemployment allowance deductible period in the case of temporary lay-off. In the case of dismissal, the deductible period applies as for usual.

Content of measure

This measure applies to all job-seekers that have been temporarily laid off between 16 March 2020 and 6 June 2020 and meet the criteria for either basic unemployment allowance (earnings-related unemployment allowance.

For those job-seekers that have been temporarily laid-off and who qualify for earnings-related unemployment allowance, this measure has financial significance since it extends the period they can receive earnings-related unemployment allowance in case they are dismissed after the lay-off or in the following months. The average earnings-related unemployment allowance is €65 per workday whereas the basic unemployment allowance and the labour market subsidy are €34 per workday.

Updates

The following updates to this measure have been made after it came into effect.

06 July 2020

In May 2020, the peak-level social partners proposed to the Government that the duration of the COVID-19 related labour market policies, including cancellation of the unemployment allowance deductible period, should be extended until the end of 2020 instead of 6 July 2020. They also proposed for extension of this measure to cover even unemployed employees.

In June, 2020 this temporary provision was extended to 31 December 2020. As of 1 July 2020, it covers both unemployed job-seekers and temporarily laid off job-seekers.

Use of measure

By the end of May 2020, there were 158,100 temporarily laid off job-seekers in Finland. This was 5,600 less than in April 2020. In comparison to May 2019, the number of temporarily laid off job-seekers had increased by 149,800. This includes only those job-seekers that were laid-off on a full-time basis.

Target groups

Workers Businesses Citizens
Unemployed
Does not apply to businesses Does not apply to citizens

Actors and funding

Actors Funding
National government
Public employment service
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Agreed (outcome) incl. social partner initiative Agreed (outcome) incl. social partner initiative
Form Any other form of consultation, institutionalised (as stable working groups or committees) or informal Any other form of consultation, institutionalised (as stable working groups or committees) or informal

Social partners' role in the implementation, monitoring and assessment phase:

  • Unknown
  • Main level of involvement: Peak or cross-sectoral level

Involvement

In March 2020, the peak-level social partners (the Confederation of Unions for Professional and Managerial Staff in Finland, the Central Organisation of Finnish Trade Unions SAK, the Finnish Confederation of Professionals STTK and the Confederation of Finnish Industries EK) jointly proposed a set of actions for the Finnish Government. The measures were proposed as a package that includes both measures that support adaptation of businesses to the new market situation and measures that improve the situation of employees who have been dismissed or temporarily laid off.

Cancellation of the unemployment allowance deductible period was part of this joint proposal.

Furthermore, peak-level social partners were consulted during the drafting period of these amendments.

Views and reactions

The peak-level social partners stress that this measure is part of the wider package of measures (proposed by them in March 2020) and amendments to labour law that include both measures that facilitate adaptation of businesses to the new market situation but also measures that support employees who are being either temporarily or permanently dismissed.

Sources

  • 20 March 2020: Social partners’ proposals to help businesses in the corona crisis (akava.fi)
  • 02 April 2020: Hallituksen esitys eduskunnalle laeiksi työttömyysturvalain, työttömyysetuuksien rahoituksesta annetun lain ja työttömyyskassalain väliaikaisesta muuttamisesta (www.eduskunta.fi)
  • 14 May 2020: Labor market organizations agree on layoffs and unemployment security (Työmarkkinakeskusjärjestöt sopuun lomautuksista ja työttömyysturvasta) (ek.fi)
  • 05 June 2020: Government proposal HE 94/2020 vp (Hallituksen esitys HE 94/2020 vp) (www.eduskunta.fi)
  • 23 June 2020: Measures that have brought security and flexibility to labour markets during coronavirus epidemic will be extended (Jatkoa toimille, joilla on tuotu turvaa ja joustoa työmarkkinoille korona-aikana) (tem.fi)
  • 25 June 2020: Employment Bulletin May 2020 (Työllisyyskatsaus toukokuu 2020) (julkaisut.valtioneuvosto.fi)

Citation

Eurofound (2020), Cancellation of the unemployment allowance deductible period in the case of temporary layoff or dismissal, measure FI-2020-17/546 (measures in Finland), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/FI-2020-17_546.html

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Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.