Earnings-related unemployment benefit
As an unemployment fund member, you are entitled to earnings-related unemployment benefit when you are laid off or unemployed if the membership condition and work requirement are fulfilled.
What is earnings-related unemployment benefit?
Unemployment benefit is paid to secure the livelihood of an unemployed jobseeker. Unemployment benefits include earnings-related daily allowance paid by The Unemployment Fund Ote and General social security benefit paid by Kela.
Unemployed jobseekers who fulfil both the membership and employment condition are entitled to earnings-related unemployment benefit. The earnings-related unemployment benefit is based on your previous earnings, which means that it is considerably higher than benefit granted by Kela.
You can estimate your daily allowance for the period of unemployment or lay-off by using a calculator.
The earnings-related unemployment benefit is considerably higher than benefits paid by Kela.
When will I start receiving earnings-related unemployment allowance?
- You are unemployed and registered as an unemployed jobseeker with the employment services of your municipality of residence. Read more about becoming unemployed and applying for earnings-related unemployment allowance.
- You have been a member of an unemployment fund for at least 12 months, which means you meet the membership condition.
The membership period may also include membership in another unemployment fund, if the member joined Ote within one month of the end of the previous fund membership. In addition, the membership fees of the previous fund must have been paid up to the end of the membership period. - During your membership, you have accumulated the 12-month employment condition.
The full 12-month employment condition can consist of full employment-condition months or half-months. All work performed counts toward the employment condition, meaning the work does not have to be in your own field.
- You accumulate one full month toward the employment condition by earning at least €930 gross salary from work during a calendar month. The work may be part-time, but the gross salary must be at least the above-mentioned €930 per month. The salary must comply with the collective agreement applicable in the sector, or if there is no collective agreement, the salary for full-time work must be at least €1,463 per month.
- You accumulate half a month toward the employment condition by earning at least €465 gross salary from work during a calendar month. The same minimum salary requirements apply as above.
Eligibility for earnings-related unemployment allowance may therefore arise, for example, from a period consisting of 10 full employment-condition months and 4 half-months. The employment must be verifiable afterward, so it is advisable to keep your payslips.
The decision on granting earnings-related unemployment security is made by the unemployment fund. The unemployment security of Loimu members is handled by the Ote Unemployment Fund.
There are various regulations and exceptions concerning the conditions for earnings-related unemployment security, so it is advisable to check the most up-to-date and accurate information either by contacting Ote Fund member services or on the Ote website.
If you are not entitled to earnings-related unemployment security, you can apply for General social security benefit from Kela.
You have to fulfil the membership and work requirement in order to receive earnings-related unemployment benefit.
Special Situations Related to Fulfilling the Employment Condition
To meet the employment condition, you must have worked for at least 12 months during the 28 months preceding unemployment (the review period).
The review period may be extended if there is an acceptable reason defined in the Unemployment Security Act. However, the review period cannot be extended for periods during which you were not a member of the unemployment fund.
In practice, extending the review period means that periods spent outside the labour market for the reasons listed below can be skipped over, allowing the review period to reach further back in time before the absence. Acceptable reasons do not include, for example, staying abroad or caring for one’s home.
The review period can be extended by a maximum of seven years.
Acceptable Reasons Under the Unemployment Security Act for Extending the Review Period
Acceptable reasons for extending the 28-month review period due to absence from the labour market include, among others:
- full-time studies
- sick leave
- institutional care
- rehabilitation
- military service
- civilian service
- imprisonment
- alternation leave
- grant-funded periods, and
- caring for a child under the age of 3.
Note for Students!
A full-time student who has joined an unemployment fund can accumulate the employment condition throughout their studies, for a maximum of seven years, because studies are considered an “acceptable reason” for being outside the labour market. This extends the review period for accumulating the employment condition.
It is therefore advisable to join an unemployment fund early in your studies so that you can accumulate the employment condition before graduation.
Remember to save all employment contracts and payslips from the period of your unemployment fund membership as proof for calculating your employment condition and earnings-related allowance. Keep these documents carefully stored, as you will need them if you apply for unemployment benefits.
Accumulation of the Employment Condition Before 2 September 2024
The conditions for receiving earnings-related unemployment allowance changed on 2 September 2024. The most significant change concerned the employment history required for eligibility.
Until 1 September 2024, earnings-related unemployment allowance could be received after six months of employment (26 calendar weeks). From September 2024 onwards, eligibility has required 12 months of employment. During the employment period, the person must have been a member of an unemployment fund.
Employment weeks accumulated up to 1 September 2024 are converted into months so that four weeks contributing to the employment condition equal one month towards the employment condition. Of the remaining weeks, three weeks equal one full employment condition month, while one or two weeks equal half an employment condition month.