Adjusted and reduced daily allowance
Earnings-related unemployment allowance can be paid adjusted if you work part-time or occasionally, or if you are a part-time entrepreneur. The allowance is paid reduced if you are paid certain social benefits.
Adjusted daily allowance
You can claim an adjusted earnings-related allowance, if
- you are working part-time (however, not if the working hours have been reduced at your own instigation), or
- your daily or weekly working hours have been reduced due to a lay-off, or
- you have accepted full-time employment lasting no more than two weeks while being unemployed, or
- you receive income from business activities or self-employment, if this is considered part-time by the TE Office
- you receive writer’s fees, etc.
A current application for full-time employment at a TE Office is a prerequisite for the payment of adjusted allowance also!
Part-time work refers to employment subject to unemployment allowance, where the working time is no more than 80% of the maximum working time applicable to full-time employees in the sector.
Full-time employment refers to employment where the working time is more than 80% of the maximum working time applicable to full-time employees in the sector. Employment lasting no more than two weeks refers to full-time work carried out continuously for no more than 14 days.
In the education sector, weekends are usually paid if the employment or public service relationship Is valid during weekends. If the employment is interrupted so that weekends are unpaid, the employment period cannot be more than two weeks.
If you are in continuous full-time employment for the same employer for more than two weeks, this period is skipped so that your allowance can be paid up to the start of the work and then again after it ends.
The payment of an adjusted allowance requires that your working hours do not exceed 80% of the maximum full-time working hours in that sector (in the education sector, this usually refers to the teaching obligation) during the allowance claim period (4 calendar weeks or one month).
Income from work is generally taken into account in the daily allowance based on the payment date. This means that salaries are primarily considered for the period in which the payday falls. For example, if your adjustment period is a calendar month, all adjustable income that is paid during that month, will be adjusted. The adjustment period is always either four calendar weeks or a month (even, for example, if the application period is shorter due to the start or end of unemployment).
If employment income for a period longer than a month has been paid during the adjustment period, and if this procedure deviates from the usual pay period, the employment income and the working hours on which the pay is based will be divided to affect the payment month and as many subsequent months as the number of months for which the income has been paid.
Anna has done occasional substitute work in the spring and she is fully unemployed starting June 1, 2024. During the spring, Anna has applied for adjusted daily allowance in calendar month periods.
Anna applies for the daily allowance for the period June 1, 2024 – June 30, 2024. During this period, Anna is paid a total of 600.00 euros on June 14, 2024, for her occasional work in the spring. Even though Anna has been completely unemployed from June 1, 2024, to June 30, 2024, these salaries reduce the amount of her earnings-related daily allowance for that period because the payday for the occasional work falls within that adjustment period.
The salary reduces the full earnings-related daily allowance by 300.00 euros per month (13.95 euros per day).
Anna has worked part-time during the spring. She usually receives her monthly salary on the 15th of the month.
Anna has had a monthly application cycle, from the 15th of the month to the 14th of the following month. Anna applies for the daily allowance for the period from May 15, 2024, to June 14, 2024. She was paid her April monthly salary (1,500 euros, 51.60 hours) on May 15, 2024. The May monthly salary would typically be paid on June 15, 2024, but since that day is a Saturday, the salary is paid on June 14, 2024, deviating from the usual payday. This salary is also 1,500 euros, with the working hours of 51.60 hours.
Therefore, Anna receives salary for a period longer than a month during the adjustment period, and this situation deviates from the usual pay period, so the salary and the working hours on which the salary is based are divided to affect two months.
Thus, 1,500.00 euros are taken into account for the period from May 15, 2024, to June 14, 2024, and 1,500.00 euros for the period from June 15, 2024, to July 14, 2024.
In the working hours review, 51.60 hours are considered for the period from May 15, 2024, to June 14, 2024, and 51.60 hours for the period from June 15, 2024, to July 14, 2024.
Amount of adjusted daily allowance
Until 31.3.2024, the income of a person entitled to an adjusted allowance only affects the earnings-related allowance when it exceeds the standard entitlement. In addition to earned income, the standard entitlement is also applied to income from part-time business activities that is eligible for adjustment.
The amount of the standard entitlement depends on the adjustment period applied. The adjustment period is normally the same as the application period. If the adjustment period is one month or one calendar month, the income is taken into account in the adjustment to the extent that it exceeds EUR 300 (gross). If the adjustment period is a period of four calendar weeks, the income that exceeds EUR 279 (gross) is taken into account in the adjustment. After exempting the standard entitlement, one half of the income paid during the adjustment period (one month or four calendar weeks), is deducted from the full allowance.
As of 1.4.2024, a legislative amendment entered into force, which removed the standard entitlement from use. After the abolition of the standard entitlement, half of the adjusted income reduces the amount of the full daily allowance.
You can read more about the removal of the standard entitlement and other legislative changes in the Legislative changes 2024 -section, which can be accessed by clicking the button below.
In adjusted daily allowance, the income to be adjusted includes not only the actual wage but also, for example, holiday pay and compensation paid for part-time or occasional work, meal benefits, and taxable expense reimbursements.
Person A applies for adjusted daily allowance for the period 1.1.2023 – 31.1.2023, the adjustment period is a calendar month. On 15.1.2023, A will be paid EUR 500.00 of salary for part-time work. Thus, the salary reduces the amount of full daily allowance by EUR 100.00
Formula: (EUR 500.00 – EUR 300.00) * 0,5 = EUR 100.00
Person A applies for adjusted daily allowance for the period 1.4.2024 – 30.4.2024, the adjustment period is a calendar month. On 15.4.2024, A will be paid EUR 500.00 of salary for part-time work. Thus, the salary reduces the amount of full daily allowance by EUR 250.00
Formula: EUR 500.00 * 0,5 = EUR 250.00
You can estimate the amount of your adjusted earnings-related allowance by using the allowance calculator in Openetti(opens in new window, you move to another service).
Maximum amount of adjusted daily allowance
Adjusted earnings-related allowance has a maximum amount. Adjusted allowance with child increase and your pay from work in total may not exceed the wages on which the daily allowance is based.
Accumulation of the maximum payment period
Adjusted unemployment allowance is counted towards the general maximum payment period for unemployment allowance, but it usually lasts longer. An adjusted unemployment allowance is taken into account for the maximum payment period by converting it into full unemployment allowance days.
Example: If you receive an adjusted unemployment allowance of EUR 500 in a month and the full unemployment allowance is EUR 50 per day, this counts as EUR 500 : EUR 50/day= 10 days.
Effect of social benefits
Social benefits can affect your earnings-related allowance. Some benefits prevent the payment of earnings-related allowance, some reduce the full amount of the allowance, and some have no effect at all.
All social benefits applied for and received must be reported to the fund in order to determine whether the benefit will affect the amount of your earnings-related allowance. However, child benefit, housing allowance or social assistance need not be reported.
Information about pensions and benefits income paid on and after 1 January 2021 must be reported to the Incomes Register. Unemployment funds will report all paid benefits also to the Incomes Register starting from January 2021.
Benefits that prevent the payment of earnings-related allowance include
- several pensions
- full or partial sickness allowance
- maternity, paternity, parental or pregnancy allowance
- rehabilitation allowance
Benefits that reduce an earnings-related allowance include
- partial disability pension
- child home care allowance (family-specific)
- flexible care allowance
- disability pension received from another country
Social benefits that do not affect the payment of earnings-related allowance include
- child benefit
- housing allowance
- survivors’ pensions, including assistance and supplementary assistance pensions
- partial early old-age pension
- social assistance under the Social Welfare Act
- disability benefits
- care allowance under the National Pensions Act
- maternity benefit
- adoption benefit
The child home care allowance paid to the applicant for earnings-related daily allowance is always deducted from the amount of the earnings-related allowance.
As a rule, the child home care allowance paid to the applicant’s spouse is deducted from the applicant’s earnings-related allowance. However, the home care allowance paid to the spouse is not deducted, if
- the spouse is also unemployed and the child home care allowance is paid to the spouse
- the spouse takes care of the child him-/herself and the spouse is not entitled to unemployment benefit due to childcare
- in addition to home care allowance, the spouse receives maternity, paternity, parental or pregnancy allowance