Occupational insurance scheme still up in the air

The number of occupational accidents and illnesses in Estonia has been high for years, although there was a small decrease during the economic crisis. However, with the recent upsurge in the economy, the rate has started to rise once more. Social partners have been discussing the idea of creating and implementing an occupational accident and illness insurance scheme for years, but continually fail to reach agreement. The new government has pledged to implement such a scheme by 2014, although employers still oppose the idea.

High number of occupational accidents and illnesses

According to the Labour Inspectorate (Tööinspektsioon), the number of registered work accidents and illnesses is misleading, appearing to be considerably lower in Estonia than in other EU Member States. However, it seems this is not due to better working conditions here than in other Member States, but rather to the underreporting of minor work accidents and under-registration of occupational illnesses.

This is supported by an assessment of occupational accidents and illnesses made by the Ministry of Social Affairs (Sotsiaalministeerium), which compared statistics from across the EU. It claims that the real number of occupational accidents each year in Estonia could be as much as two- to five times as high (between 7,300–15,500) as is now reported, and the number of occupational illnesses almost three times higher (330–360).

The actual incidence of occupational accidents and illnesses in Estonia has been high for years. Even though the number fell during the economic crisis, it is rising again as the recession has started to recede.

Registered occupational accidents and illnesses, 2006-2010
 

2006

2007

2008

2009

2010

Occupational accidents

3,659

3,723

4,075

2,939

3,212

Occupational illnesses

268

161

163

154

234

Source: Labour Inspectorate, 2011

A recent follow-up assessment on the state’s activities in ensuring a safe working environment made by the National Audit Office of Estonia (NAO) in 2011 also turned attention to continuing problems in the working environment. NAO found that problems that had already been raised in 2007 had not been resolved (EE1105029I).

Proposals for a new insurance system

Although Estonia is one of the few EU Member States that does not have an insurance system for cases of occupational accident or illness, the need for such a system has been felt for many years. A tripartite agreement was concluded in 1993, which included the requirement to create such an insurance system.

Two drafts acts were sent to the state’s parliament (Riigikogu) in 2001 and 2002, but these were withdrawn in 2003. In 2009, a new version of the insurance scheme was introduced which would have been obligatory for all employers, and the cost of the insurance would have depended on the quality of the working environment (EE0903019I).

Despite several different proposals for an insurance scheme, no system has yet been created because employers, trade unions and the government cannot reach agreement – even though Estonia promised to create and implement such a system by 2004, when it acceded to the EU.

However the new government that assumed office in April 2011 has put together an Action Plan for 2011–2015 (124Kb PDF), which includes the creation of an occupational accident and illness insurance scheme in order to ensure a healthy work environment. The implementation of the insurance scheme should be complete by 2014 according to the time schedule laid out in the plan.

Reaction of the social partners

Social partners have opposing views on the matter. The Estonian Trade Union Confederation (EAKL) firmly supports the implementation of an occupational accident and illness insurance scheme, claiming this would motivate employers to invest more in the working environment, which in the long term would also help to decrease healthcare costs.

However the Estonian Employers’ Confederation (ETTK) has continuously rejected the idea, arguing that it would not accept the proposed version of the insurance scheme as it would increase the already high tax burden on businesses. ETTK also expressed the concern that if the tax burden for employers was increased further, some employers would try to find ways to avoid paying taxes.

Liina Osila, PRAXIS Center for Policy Studies

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