Unions Furious Over Government's Attempt to Exclude Them From Unemployment Premium Decision ({{commentsTotal}})

Peep Peterson
Peep Peterson Source: (Postimees/Scanpix)

The Trade Union Confederation is fighting a provision in the new state budget bill that would block employee representatives from having a say in the size of the nation's unemployment insurance premium.

If passed, it would mean the supervisory board of the Unemployment Insurance Fund would no longer be able to weigh in on binding proposals for the premium, where employees currently pay 2 percent and employers 1 percent of a salary into the fund. Furthermore, union representatives said the government has kept them in the dark about the important potential changes.

The Trade Union Confederation said the reform is unacceptable. Chairman Peep Peterson said the unemployment insurance system has been a pillar of the Estonian economy's sustainability and its three-party leadership (the employees, employers and government) has been a role model in Europe and elsewhere.

"I do not see a substantive justification for how the bill initiated by the Finance Ministry helps improve the current system. Rather, we see in this a reversal of a progressive reform that has brought success to Estonia," he said.

Peterson said the reform would be a blow to cooperation, consultations and shared responsibility with social partners.

"We don't consider this a progressive or sustainable governing fashion," he said.

The unions and employers have both been critical of the government for delaying a reduction to the premium, as they say the fund already has sufficient reserves.