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International Internet Magazine. Baltic States news & analytics Sunday, 23.06.2024, 14:15

Estonia extends validity of current unemployment insurance rates until 2024

BC, Tallinn, 11.09.2020.Print version
The Estonian government at its sitting on September 10th extended the validity of the current rates of the unemployment insurance premium for the period from 2021 to 2024, reports LETA/BNS.

The current rate of the premium paid by the insured person is 1.6% and the rate of the premium paid by the employer is 0.8%, making for 2.4% in total, the government's communication office said.


Minister of Social Affairs Tanel Kiik said that it's important that the state help, within the limits of its possibilities, to preserve stability in the economic environment for employers and employees alike. "Maintaining the current rate of the unemployment insurance premium is important also in order for the Unemployment Insurance Fund to have assets for the payout of benefits in a situation where unemployment apparently is set to grow in the near term. I consider it very important for the Unemployment Insurance Fund to have sufficient resources for supporting both working people as well as those who have lost their job," Kiik said in a press release. 


With an insurance rate of 2.4%, a total of 209.7 million euros is estimated to flow into the Unemployment Insurance Fund in 2021, 219.9 million euros in 2022, 230.4 million euros in 2023 and 241.1 million euros in 2024.


Under law, the unemployment insurance premium is paid on wages, salaries and other remuneration paid to insured persons.


The rates of the unemployment insurance premium must be endorsed by the government for the following year by Oct. 1 of each year. 


In addition, the government approved a proposal of the supervisory board of the Unemployment Insurance Fund to allocate 30% from both the insured persons' and employers' trust fund into the Estonian Unemployment Insurance Fund's foundation of labor market services and benefits next year, meaning an allocation of 62.9 million euros in total.


The money will be used for the provision of active labor market services and the payment of labor market support, such as grants and transport and accommodation benefits.


Also the allocation of money under that item must be endorsed by the government by Oct. 1 of each year. 


Unemployment insurance was launched in Estonia in 2002. The rate of the premium was highest in 2009-2013 -- 4.2%, consisting of a contribution of the insured person at 2.8% and a contribution of the employer at 1.4%. The unemployment insurance premium rate has been 2.4% since 2015.








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