The Unemployment Insurance Fund pays employer insolvency benefits in case of company bankruptcies.

The benefits include:

• pending salary from the period before the declaration of the employer as insolvent;
• pending holiday pay from the period before the declaration of the employer as insolvent;
• benefits from the period before or after the declaration of the employer as insolvent which were not received at the time of cancellation of the employment contract.

In case of unpaid wages, the amount to be paid covers up to the employee's gross wages for the last three months of work, but not exceeding the amount equal to three average gross monthly wages in Estonia during the quarter preceding the declaration of the employer as insolvent (data published by the Statistical Office is the reference point).

In case of unpaid holiday pay, the maximum paid amount is one gross monthly wage of the employee, but not exceeding the amount equal to one average gross monthly wage in Estonia during the quarter preceding the declaration of the employer as insolvent (according to the data published by the Statistical Office).

In case of benefits not received, the maximum paid amount is equal to the employee's two gross monthly wages but not exceeding the amount equal to one average gross monthly wage in Estonia during the quarter preceding the declaration of the employer as insolvent (according to the data published by the Statistical Office).

The benefit is financed from the national fund, i.e. from the unemployment insurance premiums paid by employers and employees which are gathered into a national fund administrated and used by the Unemployment Insurance Fund.