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Those who quit may also soon be eligible for unemployment benefits

The Unemployment Insurance Fund's (Töötukassa) logo.
The Unemployment Insurance Fund's (Töötukassa) logo. Source: Priit Mürk/ERR

The Ministry of Social Affairs is currently drafting a bill according to which those who voluntarily leave a job will also receive unemployment insurance benefits. It is yet unclear, however, how large a benefit such individuals would receive. Should those who quit their jobs receive the same benefits as those who are laid off, this would cost some €100 million per year; thus it is expected that only a partial benefit would apply to the former.

Under the current system, if someone quits their job of their own initiative, i.e. voluntarily, they are not eligible for unemployment benefits. Benefits are currently paid to those forced out of employment, such as those who are laid off or whose employer is liquidated, in the amount of up to 50 percent of their wages.

As only a quarter of those unemployed receive help from the Unemployment Insurance Fund (Töötukassa), this clearly indicates that major changes are necessary, said Estonian Trade Union Confederation (EAKL) chairman Peep Peterson. "We can see that this change is desperately needed," he noted.

Unemployment insurance benefits are paid for by employees and employers themselves, with 1.6 and 0.8 percent of wages, respectively, being accrued by the Unemployment Insurance Fund. Should unemployment benefits be extended to anyone leaving a job, according to the Ministry of Social Affairs' calculations, this would cost the state an additional €100 million per year.

Unemployment Insurance Fund director Meelis Paavel, however, said that it's not yet possible to say exactly how much such a change would cost.

"Right now, parties have expressed their opinion that these changes should fit within premiums currently in force," Paavel said. "Calculations are currently in the early stages, but it is clear that this is going to cost something. The final agreement will likely depend on how much we are capable of paying."

At its meeting with social partners and the Unemployment Insurance Fund on Monday, the Ministry of Social Affairs offered up an already scaled-back version, according to which unemployment benefits could be paid beginning 90 days after an individual quits their job.

According to Deputy Secretary General on Labour and Employment Policy Sten Andreas Erlich, this 90 day option isn't the only possible other option either.

"Maybe we should start paying [benefits] after 60 days; perhaps we should start paying later," Erlich said. "Perhaps if they quit only of their own accord, unilaterally, payments would begin on day 90, but if they leave under agreement between both parties, then unemployment insurance benefits would begin to be paid on day 60."

According to the deputy secretary general, the ministry is proposing benefits equal 50 percent of a person's prior wages, which after a time would taper off, as is the case in the current system. This benefit likewise wouldn't apply to all groups of people leaving employment.

Unemployment benefits would allow people to more safely leave a job, however a two-month period without benefits would serve to cause people to think twice before making any reckless decisions about leaving work.

According to Minister of Social Affairs Tanel Kiik (Center), it would be fair to help those who voluntarily leave work as well, as such employees have likewise paid unemployment insurance taxes.

The bill regarding the change, together with a cost-benefit assessment, are to be drawn up by the end of the year, before being discussed by the government early next year and thereafter reaching the Riigikogu.


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Editor: Aili Vahtla

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