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International Internet Magazine. Baltic States news & analytics Sunday, 29.11.2020, 19:29

Estonian Unemployment Fund pays wage compensation to 137,000 workers in 3 months

BC, Tallinn, 07.07.2020.Print version
From April to June 2020, the Estonian Unemployment Insurance Fund assigned extraordinary remuneration compensation to 136,709 employees of 17,472 companies with the average compensation amounting to 703.2 euros, informs LETA/BNS.

The largest share of people receiving wage compensation resided in Harju, Tartu and East-Viru counties and worked in the hospitality sector and the processing industry, according to the Unemployment Insurance Fund.

CEO of the Unemployment Insurance Fund Meelis Paavel said that the fist stage of the compensation has mitigated the sharp economic downturn and softened the labor market shock.

"If most entrepreneurs are able to continue their operation with the wage compensation, the measure has in any case proved itself," Paavel said in a press release.

From April until the end of June, altogether 17,584 companies applied for wage compensation for their 137,399 employees. 

Compensation was assigned to 136,709 employees of 17,472 companies; of them 27,258 people were compensated for one month and 109,451 for two months. 33,675 people were granted compensation for March, 121,494 for April and 91,130 for May. 

The average size of compensation amounted to 703.2 euros and the total sum inclusive of social tax paid by the Unemployment Insurance Fund and the employer's unemployment insurance contribution was 231.7 million euros -- 27.6 million euros for March, 113.7 million euros for April, and 90.4 million euros for May.

While in March, the largest share of beneficiaries of the measure, 26.9 percent, worked in the hospitality sector, in April and May the largest share of compensation recipients, 22.8 percent and 28.6 percent, respectively, worked in the processing industry.

The lion's share of recipients, 62.2 percent, worked in a business registered or operating in Harju County, followed by Tartu County with 10.7 percent and East-Viru County with 6.1 percent.

Close to 81 percent of the businesses whose workers were assigned compensation employed fewer than 10 people while 17 percent employed 10 to 49 people, 2.6 percent 50 to 249 people and 0.4 percent 250 or more people.

The largest total sum, 4.2 million euros, was paid out in compensation to employees of the Tallink Grupp company OU Hansaliin, followed by Eesti Energia subsidiary Enefit Kaevandused with 1.8 million euros, manufacturing company AS Norma with 1.8 million euros, transport company Bolt Technology OU with 1.4 million euros and OU HT Laevateenindus, a company of Tallink Grupp, with 1.3 million euros.

The Unemployment Insurance Fund decided not to assign compensation to close to 1,100 people, mainly due to their employer not meeting the requirement of revenue decline, not having applied sections 35 or 37 of the Employment Contracts Act, or having applied for compensation for a fictitious employment relationship that had been entered in the register solely for the purpose of benefiting from the support measure.

Based on preliminary checks, the recovery of compensation has been initiated with regard to 350 people due to the employer having violated the prohibition of redundancy or the employee having spent the entire period for which compensation was paid out on leave due to incapacity for work. The follow-up checks are to continue until the end of the year.

Employers withdrew applications for 200 people when the Unemployment Insurance Fund requested additional documents or clarifications.

The average time between the submission of application and the designation of beneficiaries was 2.2 days while the time between the submission of application and the payout of compensation averaged 3.9 days.

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