Frequently asked questions about the activation model for unemployment security
Under the activation model it is the payer of your unemployment benefit that does the monitoring and decides on the amount of your unemployment benefit. So, if you are receiving labour market support or basic unemployment allowance, the monitoring is by Kela (the Social Insurance Institution of Finland). And if you are receiving earnings-related unemployment allowance, the monitoring is by your own unemployment fund.
Using the same form that you use for applying for unemployment benefit, you should notify Kela or your own unemployment fund of any hours of paid work that you do and the pay received for this, as well as any income from self-employment or any other activity satisfying the activation requirements.
The Employment and Economic Development Office (the TE Office) does not do any of this monitoring and does not decide on whether the activation requirements apply to you.
Check with Kela (if you are receiving labour market support or basic unemployment allowance) or with your own unemployment fund (if you are receiving earnings-related unemployment allowance) about their instructions for notifying hours of work and pay if you are in paid employment. Kela and the unemployment funds may also have information on their own websites about filling in applications. You should also carefully read the completion instructions supplied with the application form. The Ministry of Social Affairs and Health requires that you give your notification in the same way as when applying for adjusted unemployment benefit, and you should also ensure that your hours of work are always notified.
The period of 65 benefit payment days equates to about three months of continuous unemployment.
The period of 65 benefit payment days means 65 weekdays (= Mon–Fri) for which you receive unemployment benefit (i.e. labour market support, basic unemployment allowance or earnings-related unemployment allowance).
The accumulation of these benefit payment days is calculated by the payer of your unemployment benefit, i.e. Kela or your own unemployment fund. You do not need to calculate the period yourself, unless you wish to follow your progress towards meeting the activation requirements.
The 65 benefit payment days can be accumulated either on a continuous basis or in spells if there are interruptions in the payment of unemployment benefit. The payment of unemployment benefit will be interrupted if, for example, you fall ill and receive sickness allowance (which means that payment of unemployment benefit is suspended) or if there is an interruption in your jobseeker status.
If you participate in an employment-promoting service, this will normally be on the basis of a labour market policy statement issued by the TE Office. The TE Office issues the statement to Kela (if you are receiving labour market support or basic unemployment allowance) or to your own unemployment fund (if you are receiving earnings-related unemployment allowance). The statement will normally specify a starting date and an end date, denoting your participation period.
Within the participation period, if you are absent for a reason that prevents payment of benefit, the absence period in question will not be counted towards satisfying the activation requirements. You can get more information from Kela (if you are receiving labour market support or basic unemployment allowance) or from your own unemployment fund (if you are receiving earnings-related unemployment allowance).
If you are partially employed, you may be entitled to unemployment benefit adjusted on the basis of your earned income. Labour market support, basic unemployment allowance and earnings-related unemployment allowance can be paid in adjusted form if you become employed for up to two weeks full-time as an employee or in full-time self-employment; or if you work part-time or in a temporary post or in other short work spells as an employee; or if you are in part-time self-employment. More information about adjusted unemployment benefit is available from Kela (in the case of labour market support or basic unemployment allowance) or from you own unemployment fund (in the case of earnings-related unemployment allowance).
If your gross earnings for the month are no more than EUR 300, your unemployment benefit will be paid in full. If your gross earnings exceed EUR 300, your unemployment benefit will, under normal circumstances, be adjusted downwards by an amount equal to half of the earnings in excess of EUR 300. You can do your own test calculations in regard to labour market support and basic unemployment allowance here, and in regard to earnings-related unemployment allowance here.
Take a look, too, at the instructions given by Kela or your own unemployment fund concerning applications for adjusted unemployment benefit. And remember to enter your hours worked on the application form!
If, during the time you receive unemployment benefit, there is a period of 65 benefit payment days when you do not meet the activation requirements, the benefit will be reduced for the following period of 65 benefit payment days. If you are able to meet the activation requirements during this new period of 65 benefit payment days, your benefit will return to normal in the next period of 65 benefit payment days. You can find more information here: Take a look at the diagram in particular.
Your unemployment benefit will also return to normal in cases where you have started to receive the reduced amount of benefit but then:
you become employed full-time in paid work for an uninterrupted period of more than two weeks, before returning to be a benefit recipient again; or
you become self-employed on a full-time basis for an uninterrupted period of more than two weeks, before returning to be a benefit recipient again; or
you become partially employed and no adjusted unemployment benefit is payable for the application period on account of the amount of income from employment or the time employed, after which you return to being a benefit recipient again; or
you become an unemployment benefit recipient again after the TE Office, in a written statement, has imposed a period without benefit, or after the end of a duty-to-work period.
The amount of unemployment benefit will also return to normal if it was being paid in reduced form and the benefit recipient meets the work requirement again. At the same time, the maximum period of payment that applies to the unemployment allowance will be restarted from the beginning.
Voluntary work, including informal voluntary work, does not count towards satisfying the activation requirements. Voluntary work is not paid employment, self-employment, an employment-promoting service or an activity arranged by the employment authorities.
The full unemployment benefit can be reduced by 4.65 per cent. This reduction is not cumulative, which means that the benefit cannot get steadily smaller.
The reduction in unemployment benefit made in accordance with the activation model is not cumulative, even if you have successive periods of 65 benefit payment days when you do not meet the activation requirements.
The activation model basically applies to those who are receiving unemployment benefit. If the payment of your unemployment benefit is interrupted because you are receiving sickness allowance, for example, your activeness in meeting the activation model requirements will not be monitored during the period you receive sickness allowance. Where the period of 65 benefit payment days is interrupted in this way, it will continue after the period of your sickness allowance if you once again become a recipient of unemployment benefit.
However, in the following situations the activation model will not apply to you even though you are receiving unemployment benefit (i.e. your fulfilment of the activation requirements will not be monitored and your benefit will not be reduced):
Alongside your unemployment benefit you receive another benefit that is based on incapacity for work or a disability. Such benefits include partial disability pension, partial rehabilitation allowance and disability allowance. More information on these benefits can be obtained from Kela or your own unemployment fund.
You have applied for a disability pension and your application is being processed by a pension institution.
In situations other than 1 and 2, the activation model applies. A doctor's certificate indicating incapacity for work is not sufficient to exempt you from the activation requirements. Only in the situations referred to in 1 and 2 above will the activation model NOT apply. The activation model will apply to you if your application for a disability pension has been rejected and you are applying for a review of the decision.
The activation model also applies to unemployment benefit recipients who are on extended basic unemployment allowance or extended earnings related unemployment allowance.