It is a common misconception that earnings-related allowance is always calculated as a certain percentage of salary. Unfortunately, there is more to it than simple percentages. Your earnings-related allowance is based on your average daily salary, calculated from a period of at least 12 months preceding your unemployment or lay-off.
All months that fulfil the employment condition are included in determining the amount of your earnings-related allowance. In other words, these are the calendar months during which you have received salary income, excluding any holiday bonus and holiday compensation, of at least 930 euros (a full employment condition month) or at least 465 euros (one half of an employment condition month).
How daily allowance is determined
Earnings-related allowance consists of a fixed basic component and an earnings-related component. In 2025, the basic component is 37.21 euros per day. The difference between your average daily salary and the basic component forms the basis for calculating your earnings-related component. For a monthly salary of up to 3,534.95 euros, your earnings-related component amounts to 45% of the difference between your average daily salary and the basic component. For any salary that exceeds 3,534.95 euros, the earnings-related component is 20%. Your daily salary is calculated by dividing your pre-unemployment average monthly salary by 21.5 and then deducting any statutory fees (total of 3.54% in 2025).
For instance, an average monthly salary of 3,000 euros would yield an earnings-related allowance of 1,742 euros/month, whereas Kela’s basic unemployment allowance would stand at just 800 euros/month. Earnings-related allowance almost always exceeds the basic unemployment allowance paid by Kela. And unlike Kela’s benefit, earnings-related allowance is not subject to means-testing, so it is definitely worth being a fund member.
The exact amount of your daily allowance will be stated in the decision issued by your unemployment fund, but you can get an estimate from our online daily allowance calculator.
Some salary items are not factored in
The calculation of earnings-related allowance accounts for components such as basic salary, holiday pay, overtime pay, personal bonuses and taxable benefits in kind. However, components such as holiday bonuses, golden handshakes, tax-free reimbursements or capital income are not factored in the calculation of your earnings-related allowance.
Which salary components are included?
Some salary components are not factored in the calculation of earnings-related allowance. Please see the examples below.
Included (list is not exhaustive)
- monthly, daily and hourly salary
- piece-work wages
- annual leave pay
- sick pay
- salary for the period of notice (not compensation)
- salary supplements: overtime pay, evening work allowance, shift work allowance, contract base, midweek holiday allowance, etc.
- performance-based remuneration, such as various kinds of performance-based remuneration and bonuses
- taxable benefit in kind, e.g., phone and meal benefit
- salary paid as wage security, insofar as they are based on salary items listed above
Excluded (list is not exhaustive)
- holiday bonus and holiday compensation
- tax-free benefit in kind
- tax-free allowances (e.g., kilometre allowance, tool allowance)
- financial benefit paid by the employer in connection with the termination of employment, that is, a so-called golden handshake (regardless of what it is called)
- compensation and damages corresponding to the salary for the period of notice
- savings in the working time account or cash compensation withdrawn from the working time account
- salary for the waiting period
- capital income, e.g., option and dividend income
- scholarships, grants and income from entrepreneurial activities
Increased earnings-related component runs out gradually
In the past, participation in employment-promoting services did not affect a member’s eligibility for the increased earnings-related component. Since the beginning of 2025, however, the increased earnings-related component no longer applies to any new service periods. If an employment-promoting service has commenced by December 31, 2024, the increased earnings-related component can be paid until the end of the provision of the service or until payments have been issued for 200 days, whichever occurs earlier.
If an employment-promoting service has commenced by December 31, 2024, the increased earnings-related component can be paid until the end of the provision of the service or until payments have been issued for 200 days, whichever occurs earlier.
Staggering reduces the amount of daily allowance in prolonged unemployment
According to the new staggering model in effect since September 2, 2024, the amount of earnings-related allowance gradually decreases in prolonged unemployment:
- First 40 days: earnings-related allowance in full
- Days 41–170: 80% of the original amount
- From day 171: 75% of the original amount
Staggering applies to those who fulfil the new 12-month employment condition on September 2, 2024, or after. Previously fulfilled employment conditions as well as allowance periods that have started before the aforementioned date adhere to the prior unstaggered model.
You are entitled to full earnings-related allowance only after you fulfil the employment condition again, i.e. you work and receive salary income for a minimum of 12 months under an employment relationship that fulfils the employment condition.
Adjusted daily allowance for part-time and short-term employment
Working during unemployment does not automatically disqualify you for earnings-related allowance. You can be eligible for adjusted earnings-related allowance if:
- you work part-time (excluding self-imposed shortened hours, e.g. partial nursing leave or partial early old-age pension along with self-imposed shortened hours)
- you are laid off for a shortened workday
- you have accepted full-time employment for a maximum period of two weeks
- you are employed part time through entrepreneurial activities or with your regular employer
- you are employed full time as an entrepreneur for a maximum period of two weeks
- you engage in entrepreneurial activities while unemployed, in which case you have four months of benefit eligibility
Adjusted daily allowance is paid for weekdays (Monday to Friday), including the days during which you work, provided that the work is subject to adjustment. The amount of your adjusted daily allowance depends on the amount of your daily allowance and your earned income. Your income typically affects your benefit at the time you get paid, in accordance with the so-called payment-based adjustment.
If you are laid off to reduced weekly working hours and you also perform other work or receive income for entrepreneurial activities, your daily allowance is adjusted with the earnings-based method, i.e. for the adjustment period during which the work is performed. If you do not perform other work or earn income for other work alongside your lay-off, you are entitled to full earnings-related allowance for your lay-off days.
If your hours exceed 80% of your industry’s full-time working hours, you are ineligible for both full and adjusted daily allowance.
You must be registered as an unemployed jobseeker at Job Market Finland for as long as you are subject to adjustment, including your working days. Please refer to the daily allowance calculator for an estimate of your adjusted daily allowance.
Summary:
- Earnings-related allowance is based on salary income.
- Staggering reduces daily allowance gradually during prolonged unemployment.
- Increased earnings-related component will be gradually abolished during 2025.
- Adjusted daily allowance enables earning income without losing benefit eligibility.
To find more information and to estimate the amount of your daily allowance:
Use the online daily allowance calculator to get an easy estimate of your earnings-related allowance. When you apply for earnings-related allowance, your fund issues a more specific decision on the amount of your daily allowance and your eligibility.
