Who is considered to be an entrepreneur?
From the perspective of unemployment security, work that is not performed under an employment or public service relationship constitutes entrepreneurial activity. You are considered to be an entrepreneur if you work without being in an employment or public service relationship or you have an entrepreneurs’ pension insurance (YEL) or a farmers’ pension insurance (MYEL). Entrepreneurial activities also include, for example, work performed through an invoicing cooperative, self-employment or acting as a private entrepreneur, a general partner in a limited partnership, a limited partner in a general partnership or a farmer.
You may also be considered to be an entrepreneur if you are a part-owner in a limited liability company, work in a leading position in the company and personally hold at least 15 % or your family holds at least 30% of the voting rights arising from the company’s shares or similar controlling powers. If you do not have a leading position in a limited liability company, you are still considered to be an entrepreneur if you work in a limited liability company and you, personally or together with your family members, hold at least 50% of the company’s share capital or voting rights.
Family members include your spouse (incl. cohabiting partner) as well as children, grandchildren, parents and grandparents living in the same household. Leading positions include board member, CEO or equivalent positions.
Indirect ownership, i.e. ownership through other companies, death estates, etc., also constitutes ownership.
Ownership in a company alone does not make you an entrepreneur and you must also work as an entrepreneur. If you are employed full-time outside your or your family’s business, you are a paid employee and you can be a member of Unemployment Fund Pro. You can also be a member of Unemployment Fund Pro if you work in a family company in which you personally do not hold a share of ownership (limited liability company) or controlling powers (other company or corporate body). In such case, the working condition is 52 weeks, and the working weeks must be accumulated within a period of 28 months. If you own even a small share in a family business, your ownership being more than 0 percent, or you work for a business owned by your family, you are considered to be an entrepreneur and cannot accumulate days towards the working condition with Unemployment Fund Pro.
The TE Office examines entrepreneurial activities
Even if you meet the definition of an entrepreneur, your entrepreneurial activities may be part-time activities, for example if you have been simultaneously employed and you are laid off from employment or your employment completely terminates and you become unemployed. The TE Office assesses whether your entrepreneurial activities are considered to be part-time activities. If your entrepreneurial activities are part-time activities according to a statement issued by the TE Office, the unemployment fund can pay you earnings-related daily allowance and any income you receive from entrepreneurial activities is deducted from the allowance (adjusted daily allowance). It is also required that you have met the working condition in paid employment during membership of an employees’ unemployment fund. As a general rule, income from entrepreneurial activities is calculated based on your most recent confirmed personal tax decision. If the TE Office determines that your entrepreneurial activities are full-time activities, you cannot receive earnings-related daily allowance. Entrepreneurial activities that were started while unemployed are an exception.
Business activities started while unemployed
During the first four months of business activities started while unemployed, the TE Office will not assess whether the activities are full-time or part-time activities, and earnings-related daily allowance can be paid for at least four months. Income from business activities reduces the amount of earnings-related daily allowance and the unemployment fund pays adjusted daily allowance. The TE Office provides the unemployment fund with a statement on the start of business activities. Which means that you must notify the TE Office about any business activities.
After four months, the TE Office examines the extent of your business activities. If the TE Office determines that your business activities are part-time activities, the payment of earnings-related daily allowance can continue. If your business activities are considered to be full-time activities, earnings-related daily allowance can no longer be paid. You can keep your Unemployment Fund Pro membership valid for up to 18 months after starting your business activities. However, we recommend that you join an entrepreneurs’ unemployment fund as soon as you start your business activities, because you cannot accumulate days towards the working condition from business activities as a member of Unemployment Fund Pro. You will also lose your right to earnings-related daily allowance if your business activities last more than 18 months and you have not terminated your membership with Unemployment Fund Pro and transferred to another unemployment fund.
Short-term business activities, for example through an invoicing cooperative
If you receive earnings-related daily allowance and work on assignments lasting no more than two weeks, for example through an invoicing cooperative, you can apply for adjusted daily allowance from the unemployment fund. Income from business activities reduces the amount of earnings-related daily allowance and the reduction is calculated in the same manner as a reduction for income from part-time employment. You must send the unemployment fund a report on the duration of your business activities when applying for adjusted daily allowance. The unemployment fund receives income information from the Incomes Register, but we may need to request supplementation.
What does post-protection mean?
Post-protection means that you will keep the working condition you have accumulated as an employee if you join an entrepreneurs’ unemployment fund within one month of starting business activities and become unemployed before you have met the working condition as an entrepreneur. Post-protection does not apply if you have received earnings-related daily allowance for the maximum payment period and then start business activities. You should transfer your membership to an entrepreneurs’ unemployment fund (Suomen Yrittäjäin Työttömyyskassa) as soon as you start your business activities in order to retain your unemployment security after any post-protection. You can accumulate days towards the working condition as a member of an entrepreneurs’ unemployment fund if you have a pension insurance (YEL, MYEL) based on annual income of at least EUR 13,573 and you are less than 68 years of age. If you are covered by an employees’ pension insurance (TyEl) and you are part-owner of a company, thus meeting the definition of an entrepreneur, you can join an entrepreneurs’ unemployment fund. Further information is available from the entrepreneurs’ unemployment fund. The working condition for entrepreneurs is 15 months.
Join an employees’ unemployment fund as soon as you start an employment relationship if you have previously worked as an entrepreneur and you are a member of an entrepreneurs’ unemployment fund. The employees’ unemployment fund can pay you entrepreneurs’ unemployment allowance if you become unemployed before meeting the working condition as an employee. Entrepreneurs’ unemployment allowance can be paid until you meet the working condition as an employee or until you reach the maximum daily allowance payment period. The amount of your entrepreneurs’ unemployment allowance is calculated based on the level of income on which your entrepreneurs’ pension insurance is based.