Calculating the rate of earnings-related daily allowance
A daily allowance calculator is available in the electronic services of Unemployment Fund Pro. The calculator provides an assessment on the amount of your earnings-related daily allowance. The only mandatory information is the field for monthly wages, where you should enter your monthly income from paid employment. The withholding tax rate on your tax card for wages should be entered in the field for withholding tax rate. Your daily allowance will be calculated when you click on the calculate button, and the clear button will clear the entered information.
Earnings-related daily allowance consists of the basic unemployment allowance (37,21 €) and the earnings-related part which is based on earned income. The earnings-related part is 45 percent of the difference between daily pay and the basic part and drops to 20 percent for income exceeding 3 534,95 € per month.
Earnings-related daily allowance cannot exceed 90 percent of the daily pay on which it is based, but the amount is always at least the amount of the basic unemployment allowance. If you are entitled to a child increase it will be added to your earnings-related daily allowance. The child increase is 7,01 € per day for one child, 10,29 € for two children and 13,26 €for three or more children.
The amount of earnings-related daily allowance is calculated on the basis of taxable wages for the period preceding unemployment. Wages from weeks that count towards the working condition are used for determining the amount of the daily allowance. The working condition is 26 weeks (see section Working condition). One working week includes five workdays.
A pension or a leave may affect the rate of daily allowance
There are exceptions to calculating the rate of earnings-related daily allowance. If you are on partial disability pension your earnings-related daily allowance is calculated on the basis of earned income from full-time employment preceding the pension, provided that you have been a member of the unemployment fund during this period. The same applies if you have been on job alternation leave or partial child care leave before the unemployment or lay-off. In these cases, earnings-related daily allowance is calculated on the basis of earned income from employment prior to the leave.
A period of partial early old-age pension cannot be skipped over when calculating the amount of earnings-related daily allowance. This means that the amount of earnings-related daily allowance is calculated directly from earned income prior to the lay-off or unemployment, even if you have been employed part-time.
Earnings used as a basis for calculating earnings-related daily allowance
Earnings-related daily allowance is calculated on the basis of established earned income. In addition to monthly or hourly pay, annual holiday pay, shift bonuses, overtime pay and other similar pay earned during the period for which the daily allowance is calculated are also taken into consideration when calculating the amount of the allowance. For example, if the amount of your daily allowance is calculated on the basis of the period 1 January – 30 June, any overtime work performed during the period and the pay for the overtime are taken into consideration in the calculation.
Earnings subject to withholding tax may include wages, salary, remuneration, bonuses or compensations that cannot be taken into consideration when calculating the amount of daily allowance. These include annual leave compensation, holiday bonus and severance pay/support package, for example. Furthermore, earnings related to the termination of employment (e.g. performance incentives or motivation bonuses) are not taken into consideration when calculating the amount of daily allowance. Earnings not included in the calculation of daily allowance are deducted from the earnings subject to withholding tax before calculating the amount of the daily allowance. A one-off deduction of 4.40 percent is also applied. The deduction corresponds to employees’ pension insurance and unemployment insurance contributions and the daily allowance payment for health insurance. Please note that earnings related to the termination of employment may postpone the start of your right to daily allowance. For more information, see the section about obstacles for granting earnings-related daily allowance.
Increased earnings-related daily allowance
Earnings-related daily allowance can be paid at an increased rate (increased earnings-related part) if you participate in employment promoting services organised by the TE Office, which have been agreed upon in your employment plan or a substitute plan. Increased daily allowance can be paid for a maximum of 200 days.
How much does the increased earnings-related part increase the normal earnings-related daily allowance?
When calculating the amount of normal earnings-related daily allowance, the earnings-related part is 45 percent of the difference between daily pay and the basic part of 37,21 €, and 20 percent for income that exceeds 3 534,95 € (= 95 times the basic daily unemployment allowance). For increased daily allowance the corresponding compensation components are 55 percent and 25 percent.
Normal earnings-related daily allowance cannot exceed 90 percent of the earned income on which it is based, but this limit does not apply to increased daily allowance, which can be up to 100 percent of the earned income on which it is based.
An example of calculating increased daily allowance
The earned income on which the earnings-related daily allowance is based is 3 000 € per month. Pension insurance and unemployment insurance contributions and the 4,40-percent daily allowance payment for health insurance are deducted from the amount, which leaves the amount 2 868,00 € (= earned income on which the earnings-related daily allowance is based). The earned income on which the earnings-related daily allowance is based is then divided by 21,5, which comes to the daily pay of 133,40 €. The final increased daily allowance is calculated as follows: 37,21 € + (0.55 x (133,40 - 37,21) = 90,11 €. The increased daily allowance is 90,11 € per day if the normal daily allowance is 80,49 € per day. The increased part is 9,62 € per day.
You can calculate the estimated amount of your increased daily allowance by using the calculator available in our electronic services.