Saturday 10/23/21

Entrepreneurs entitled to unemployment protection due to coronavirus

The total amount is about 724 euros per month, although it may be reduced if the business has not been terminated and the beneficiary still has some income.
Minister-of-Employment-Tuula-Haatainen-by-Lauri-Heikkinen-Vnk
Minister of Employment Tuula Haatainen. Photo: Lauri Heikkinen/Vnk.

The Government of Finland has decided to temporarily grant self-employed workers the right to access unemployment support. On Thursday 2 April, an urgent proposal was submitted to Parliament to temporarily amend the Unemployment Security Act.

According to the Ministry of Economic Affairs and Employment, the objective of this decision is to alleviate the difficult situation that many entrepreneurs are suffering due to the sudden and unexpected drop in demand. In the end, it is all about "ensuring the livelihood of entrepreneurs" until they can resume their activity.

Normally, for employers to receive unemployment benefits, business closure is required. But the proposal presented by the Government to Parliament aims to change that requirement. It will provide all entrepreneurs whose business have been affected by the consequences of the epidemic with an opportunity to get a labour market subsidy.

"The situation caused by the coronavirus is completely unreasonable for many entrepreneurs, and we are now coming to support entrepreneurs in many ways. Enabling unemployment benefits also for full-time entrepreneurs is one of these means. We want to make it as easy as possible for entrepreneurs to apply for and receive it," says Minister of Employment Tuula Haatainen.

Who can apply?

This change will be in force  until 30 June 2020. The right to receive unemployment support will be granted to all entrepreneurs, regardless of whether the business is conducted as a sole entrepreneur or in the form of a company. In order to get this benefit, the entrepreneurs must fulfill at least one of the following conditions:

  1. Their full-time work as entrepreneurs had to be terminated due to the damage caused by the spread of the epidemic.
  2. The income from their business activity has fallen and is less than 1,089.67 euros per month. If the business employs more than one entrepreneur, the amount of 1,089 euros per month applies per person.

Of course, the applicant will be required to prove that the termination of the employment or the loss of income was caused by the spread of the infectious disease. The closure of the business will not be a condition to access this protection.

How much is this unemployment benefit?

The amount paid will be the equivalent to the labour market subsidy: 33.66 euros (this is gross, meaning before taxes) per working day.

The total amount is about 724 euros per month, although it may be reduced if the business has not been terminated and the beneficiary still has some income. Any income of 300 euros onwards will reduce the amount of this labour market allowance.

How to apply?

According to the Ministry of Economic Affairs and Employment, entrepreneurs willing to receive this support must first register as job applicants with the Employment and Economic Development Office (TE Office), where a statement will be issued to Kela on their right to labour market support.

In practice, the process is as follows:

  1. The entrepreneur registers as an unemployed jobseeker and reports on the termination of full-time employment or a decrease in income due to the coronavirus epidemic.
  2. The Employment and Economic Development Office issues a statement to Kela on the entrepreneur's right to labor market support.
  3. Kela pays labor market support to the entrepreneur.

How long will be paid?

Labor market support can be paid from 16 March to 30 June 2020. If entrepreneurs register as a jobseeker no later than 15 April 2020, they are entitled to labor market support for the period prior to the job search, as long as the conditions for receiving the support are met.

The Ministry of Economic Affairs and Employment will announce the entry into force of the new law when the Parliament has passed and the President has approved it.

Comments