Entrepreneur, take care of your unemployment benefit by ensuring that you are a member of the right unemployment fund. As an entrepreneur, you also receive earnings-related daily allowance if you are a member of an unemployment fund and meet the work requirement.
In the Unemployment Security Act, entrepreneurs are considered to be both “actual” entrepreneurs who, in addition to working in the company, own the company in full, as well as, within certain limits, the co-owners working in the company.
If you meet the definition of an entrepreneur in the Unemployment Security Act and you are employed as an entrepreneur on a full-time basis, you must insure yourself for unemployment in the Entrepreneur Fund.
From the point of view of the accumulation of unemployment security, it is important that you are insured with the right unemployment fund, because the work done as an entrepreneur does not accrue the salaried employee’s work requirement, and work done as a salaried employee does not accrue the entrepreneur’s work requirement. If you have business activities in addition to salaried employment or you work in a company owned by your family, it is a good idea to ensure that you belong to the right unemployment fund. Also, if you establish a company or business name while you are unemployed, you must contact the Employment and Economic Development Office to clarify the matter.
In all cases, it makes sense to check with your own unemployment fund how your particular situation is interpreted in terms of unemployment security.
Entrepreneur Fund membership
If you start a business as a member of a wage-earners’ fund, you can become a member of the Entrepreneur Fund within three months of starting the business without an interruption in the unemployment security. This is achieved through the post-protection mechanism. Changing from one fund to another must occur without interruption, within a month.
Regardless of the form of business, all YEL-insured entrepreneurs (including so-called light entrepreneurs and freelancers) whose YEL insurance’s confirmed annual income is at a sufficient level and, under certain conditions, also salaried part-owners working in the company, whose TyEL-insured wage income reaches the aforementioned limit, can become members of the Entrepreneur Fund.
Membership in the Entrepreneur Fund cannot be granted through Loimu, but the membership must be applied for separately. However, you can also be a member of Loimu after joining the Entrepreneur Fund.
As an entrepreneur, you can also receive earnings-related daily allowance if you are a member of an unemployment fund and meet the work requirement.
Wage-earners’ fund membership
Please note that meeting the definition of an entrepreneur does not mean that the self-employment is full-time and does not always make it necessary to become a member of the Entrepreneur Fund. If you are engaged in entrepreneurial activities in addition to full-time salaried work and the salaried work is also your primary source of income, it is advisable to maintain your membership in the Unemployment Fund for Higher Educated Employees Erko, which is responsible for the unemployment security of salaried employees in Finland.
Post-protection period protects in the early stages of entrepreneurship
The post-protection period lasts from the commencement of entrepreneurial activities until the fulfilment of the entrepreneur’s work requirement, however, no longer than 18 months. If you become unemployed during this period, you can receive an employee’s daily allowance based on the earnings of your previous salaried work.
You are entitled to the employee’s post-protection allowance provided that before joining the Entrepreneur Fund (or before starting a business)
- you have accrued the employee’s work requirement
- your unemployment fund membership is uninterrupted
- you have not accrued the entrepreneur’s work requirement
- a maximum of 18 months has passed since the commencement of entrepreneurial activities.
The Entrepreneurship Fund also pays this post-protection allowance to its members. If you have not joined the Entrepreneur’s Fund at the very beginning of your entrepreneurial activity, it is advisable to do so as soon as possible. This way, with the help of post-protection, you can accrue as much of the entrepreneur’s work requirement as possible.
UKK Frequently asked questions
Yes, you can still be a Loimu entrepreneur member.
As an entrepreneur member, you will have access to all our membership benefits, as well as membership in Akava’s Entrepreneurs (AKY). AKY offers our entrepreneur members various entrepreneurship-related benefits and educational opportunities. In addition to these, AKY promotes the issues and interests of entrepreneurs together with other Akava unions. Find out more about our benefits and services for entrepreneur members.
Entrepreneurs pay adiscounted membership fee of EUR 16 per month. The Loimu membership fee does not cover the membership fee for the unemployment fund. If you have any questions about changes in membership fees, please contact our member services.
As a member of the Entrepreneur Fund, you can receive earnings-related unemployment allowance if your business operations cease and you meet the work requirement. It’s advisable to join the Entrepreneur Fund immediately when your business operations begin. This will allow you to start accumulating days to fulfil the self-employed persons’ work requirement right away, which means that you can become eligible for earnings-related unemployment benefit from the Entrepreneur Fund in 15 months if you become unemployed at that time.
Your unemployment fund membership fee depends on the level of unemployment insurance you choose. Upon joining the unemployment fund, you must choose the level of unemployment insurance you want. The minimum insurance level is €14,088 a year in 2023 (€13,573 in 2022). The maximum insurance level is equal to your annual work income (the sum on which your YEL or MYEL pension insurance is based). The membership fee is a personal tax-deductible expense.
You should always choose your unemployment fund based on your main occupation. In your case, it seems that your main occupation is paid employment, which means that you should join an employees’ unemployment fund. As a member of an unemployment fund, you are eligible for earnings-based unemployment benefits.
It is important that you join the correct fund. As a member of the Entrepreneur Fund, you do not accumulate days to fulfil the employee’s work requirement. If you do not belong to an unemployment fund, you can claim unemployment benefits from Kela if you become unemployed. The unemployment benefits paid by Kela are the same for everyone, and they are usually lower than the earnings-related daily allowance paid by an unemployment fund.