Estonia's top court: Benefits law unfair to parents who work during leave

The Supreme Court of Estonia en banc has ruled that parts of the Unemployment Insurance Act violate the Constitution by unreasonably reducing unemployment benefits for people who worked during parental leave.
The complainant in the case was on parental leave while also working for a modest wage. They qualified for unemployment insurance benefits, which were granted by the Estonian Unemployment Insurance Fund (EUIF). However, the parent would have received significantly higher benefits had they not worked to a limited extent during their parental leave. The parent argued that this situation was unconstitutional.
The Supreme Court en banc found that the method used to calculate the amount of unemployment insurance benefits violated the principle of equal treatment.
Maternity, paternity, parental and adoption leave — as well as the payment of benefits during these leaves — are state measures intended to promote work-life balance. These policies help parents of children under three, as well as adoptive parents, focus on their families instead of work by easing the pressure to earn an income.
However, the Supreme Court determined that the goal of work-life balance is contradicted if working during these leaves is ultimately detrimental to the insured by reducing the unemployment insurance benefits they would receive after their leave ends and they become unemployed.
The Supreme Court en banc ruled that it was unacceptable to treat the complainant unfavorably for earning wages during parental leave, compared to those who did not work during that time.
The country's top court affirmed that the legislature has considerable discretion in shaping Estonia's unemployment insurance system, noting that while abuse of the system must be prevented, people must be treated equally.
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Editor: Mari Peegel, Aili Vahtla