Edited: 19.05.2020 - 16:59

Keywords: Collective agreement, Unemployment fund, Unemployment

If you are laid off, you can get earnings-related allowance

N.B. Owing to the emergency situation caused by the coronavirus epidemic, PAM and the employers' federations have agreed temporary changes to the rules in collective agreements. These come into force on 19 March. You can find all the temporary changes here: Changes made to collective agreements due to the coronavirus epidemic 

Earnings-related allowance is paid to persons aged 17-64, but for the period of a lay-off earnings-related allowance can also be paid to persons aged 65–67 if they are laid off from an employment relationship concluded for an indefinite period or they are prevented from working due to bad weather or industrial action by other employees or the employer.

Allowance can only be paid on the basis of a statement by the Employment and Economic Development Office. This is why, if you are laid off, you need to register with the TE Office as an unemployed jobseeker and apply for full-time work no later than on the first day of the lay-off.

Allowance is always claimed in arrears. The first claim can be made for a two-week period and thereafter at four-weekly or monthly intervals. A copy of the lay-off certificate must be attached to the application. The unemployment fund gets wage details from the incomes register.

When an applicant's work requirement (26 working weeks) is met, there is a 5-day waiting period before payment, but in general no more than once a year. The waiting period has to be made up within 8 weeks. In lay-off situations the waiting period may sometimes not be made up if a short lay-off is followed by a period of employment of over 8 weeks before a new brief lay-off. In this case allowance cannot be paid for the period of a lay-off.

If allowance has been paid previously, but the work requirement has not yet been met, payments start right from the first lay-off day.

You can also get earnings-related allowance if weekly or daily working hours have been reduced 
If a lay-off is not full-time and has been implemented by reducing weekly or daily working hours, the hours worked must be entered in the allowance application. The unemployment fund gets wage details from the incomes register.

Allowance can be paid if working time is no more than 80% of a full-time employee's working time. With lay-offs working time is checked on a weekly basis. If a person does full working days during a week and is laid-off completely for some days, they are paid full earnings-related allowance for the lay-off days. If their working days have been reduced, adjusted allowance is paid for five days.

Example 1: An employee works full days Mon-Wed and is laid-off completely Thu-Sun. For this week they are paid full allowance for two days.

Example 2: An employee is laid-off by reducing the working day. They work three half days Mon-Wed and are laid-off completely Thu-Sun. For this week they are paid adjusted allowance for five days.

Example 3: A part-time worker is laid off. They are paid adjusted allowance. The adjustment period of their earnings-related allowance remains as normal, i.e. for example one month.


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