Finland: Disquiet follows cut to earnings-related unemployment benefits

Social partners have complained that they should have been consulted over recent cuts to the earnings-related unemployment benefits.

New rules came in on 1 January 2015 reducing the benefit for those who had been earning more than €3,115 per month. In 2013, 20% of those on unemployment benefit were in this income category.

The cut is due to the national budget strains.  

Traditionally, all changes to earnings-related unemployment benefits have been decided though tripartite cooperation, involving trade union confederations – the Central Organisation of Finnish Trade Unions (SAK), the Finnish Confederation of Salaried Employees (STTK) and the Confederation of Unions for Academic Professionals in Finland (Akava) – and the employers’ organisation, the Confederation of Finnish Industries (EK).  

Unemployment benefits are not financed by tax revenues, but with unemployment insurance fees that employers and employees pay to the Unemployment Insurance Fund (TVR). According to management at TVR, the labour market partners should have been consulted.

Akava said it hoped this did not constitute a step towards a development away from the Finnish tripartite tradition.

The Ministry of Social Affairs in charge of preparing the legislative amendments behind the cut claimed the labour market partners could have presented their suggestions during the preparatory work, but instead ‘silently accepted’ the amendments.

The cuts will only affect new benefits awarded after 1 January 2015.

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