Unemployment benefits glossary

Before any daily allowance is paid, there is a 5-day waiting period corresponding to 5 full working days (7 days for all waiting periods starting on or after 1 January 2024). A maximum of 5 days may elapse of the 5-day waiting period within a week.

In terms of unemployment benefit, a person is considered to be in the labour market if he or she is in gainful employment as defined by the employment condition, is employed as an entrepreneur, or has registered with a TE Office as a jobseeker. If you have been out of the labour market for more than 6 months without an acceptable reason, the employment condition must be re-fulfilled in order to be entitled to earnings-related allowance.

Entitlement to additional allowance days means that persons of a certain age can receive earnings-related daily allowance even beyond the maximum period.

Adjusted daily allowance is daily allowance that is not as high as the full earnings-related daily allowance, since it has been lowered on the basis of any earned income affecting it.

KOKO pays out daily allowances every weekday. With automatic payment, your daily allowance application is processed automatically without needing any human processing. Only follow-up applications qualify for automatic payment and them, too, only if there are no changes regarding your unemployment conditions.

Border workers work in another country where they live. They must come back to their home country at least once a week.

All weekdays from Monday till Sunday are considered as calendar days. For example, in January there are 31 calendar days.

A calendar week begins on Monday and ends on Sunday. A week may begin, for example, on Wednesday and end on Tuesday. The employment condition is fulfilled with 26 calendar weeks. Any employees temporarily laid off who have been working shortened daily or weekly working hours must fill in their applications for full calendar weeks.

Employees posted abroad work outside Finland but continue to be covered for the entire duration under Finnish social security. All social security contributions and insurance premiums related to the salary are paid into Finland.

The employment condition of 26 calendar weeks must be fulfilled in order to receive allowance. The employment condition must be fulfilled within the review period.

The EU area consists of the EU and EEA countries and Switzerland. The EU countries are Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, United Kingdom, and Northern Ireland (the Isle of Man and Channel Island, for example, are not part of the EEA). In addition to the above, Iceland, Liechtenstein, and Norway are EEA countries.

Extension period refers to a time period that lengthens the review period. On extension period you have had an acceptable reason to be out of the labour market, such as study, parental leave, or military service.

A full-time entrepreneur, in terms of unemployment security, is a person whose business activities the TE Office considers to be full-time.

Work, of which the working hours take up more than 80% of full-time employment. This means that under the Unemployment Security Act, part-time work can be considered full-time employment provided the working hours exceed the 80% mark. For example, if you work 32 hours per week and the full-week hours are 37.5, you are considered to work full-time (37.5 h * 80% = 30 h).

The ground for an adjustment means that, during the adjustment period for the daily allowance, you have been paid income from, for example, part-time work or business activities. In some layoff situations, the adjustment ground arises from the fact that during the adjustment period you are working part-time.

A holiday bonus is generally 50% of your holiday pay. Employers pay holiday bonus on the basis of the collective agreement, employment contract, or general practice at the workplace. A holiday bonus is not statutory, so not everyone is automatically entitled to it. Holiday bonus is not taken into account when calculating daily allowance.

Compensation paid at the end of an employment relationship for any holiday days that you have not taken off. Holiday compensation may also be paid with each salary. Holiday compensation is not taken into account when calculating daily allowance.

Pay during holiday. Holiday pay is taken into account in daily allowance calculation as normal pay.

An increased earnings-related component is paid for the period when you take part in a service that promotes employment.

You live in Finland if you have a permanent address in Finland and close family connections even if you work in another country. Determining your permanent address is always done case by case when processing an application for earnings-related allowance.

The maximum period for the payment of earnings-related daily allowance is 300, 400, or 500 days. Daily allowance is paid for 5 days a week.

You must have been a member for at least 26 weeks in order to fulfil the membership condition. You must fulfil the membership condition in order for the daily allowance to be paid.

Own work is work that is not gainful employment. For example, being a family carer is considered own work.

A part-time entrepreneur, in terms of unemployment security, is a person whose business activities the TE Office considers to be part-time.

Work that takes up a maximum of 80% of full-time work is considered part-time work. For example, 80% of 37.5 hours is 30 hours.

A pay certificate is a certificate issued by an employer for the unemployment fund concerning salary payment during a specified period. The pay certificate must specify, not only the monthly pay, but also any holiday bonuses and compensation, and all other items paid in addition to the monthly pay.

A payslip is a document provided on each pay day by the employer containing details about the pay.

Any compensation (golden handshake) at the end of an employment relationship will postpone the right to earnings-related allowance. This is called periodisation. This only affects days from Monday to Friday.

A daily allowance is paid on the basis of post-protection when, for example, a new business operations ends within 18 months and the entrepreneur’s employment condition has not yet been fulfilled. In such a case the allowance is based on the right to earnings-related allowance previously accumulated.

The review period is 28 months, within which the employment condition must be fulfilled. The review period is calculated backwards from the date when you registered with the TE Office as a jobseeker. The review period can be extended if you have been out of the labour market for an acceptable reason, such as study or parental leave.

Posted workers abroad are paid in the country they are working in. Salary for insurance purposes is the salary reported by the employer to, for example, a pension insurance company, for the purposes of Finnish social welfare and social insurance payments. The daily allowance of a posted worker is calculated from the salary for insurance purposes. The salary earned in the country where the work is performed may be different from the salary for insurance purposes reported to Finland.

The amount of earnings-related allowance depends on the earned income in the application period. You will receive the full daily allowance if your income is below the standard entitlement. The standard entitlement is €300 during an adjustment period of one month, and €279 during 4 calendar weeks. Half of any amount of salary in excess of it, is subtracted from the daily allowance.

Please note: As a result of the legislative amendment, the standard entitlement of earned income will be removed as of 1 April 2024. Read more: Changes to the unemployment security system 2024

Labour policy statement issued by TE Office. The fund must receive a statement that there are no restrictions in daily allowance payments to you. In order to get such a statement, you must contact the TE Office.

A period determined by the TE Office during which no daily allowance is paid. A suspension period may be imposed because, for example, you have resigned your job or refused to accept a job. The 5-day waiting period and periodisation are often confused with the suspension period.

Employment and Economic Development Office that gives your unemployment fund a labour policy statement regarding your unemployment.

Any other country than EU/EEA countries and Switzerland is considered a third country.

A TyEL reduction of 3.76% (2024) will be made of accumulated earnings before calculating the amount of your daily allowance. The amount of the reduction is checked annually, and it corresponds to an employee’s employment pension and unemployment insurance contributions and health insurance daily allowance.

This form is used to transfer employment and insurance months into another country within the EU. The form is needed when you move into another EU country and claim unemployment benefits there. You should ask for this form only when you know that you will need it. You need to resign from your unemployment fund membership, when a U1 form is issued to you.

You will need a U2 form issued by unemployment fund to go on a job search within the EU. The form is issued by the unemployment fund and you must request for one at least 2 weeks before setting off.

A work hour bank is a system allowing employees some flexibility in when to do their work, enabling them to deposit and withdraw working hours.