Types of employment have diversified in both form and content. There is an increasing number of jobs where working hours vary and which do not involve a traditional employment relationship. As new technology solutions emerge, they bring about entirely new type of work. However, many jobs still remain where work is conducted full-time and under an employment relationship, bound to a specific time and place.
What does partial employment mean?
In terms of unemployment security, part-time work is any work conducted under an employment relationship where the working hours stipulated in the employment agreement do not exceed 80% of a full-time employee’s maximum working hours, as applicable to the sector.
You can be eligible for adjusted daily allowance if the following criteria are met:
- part-time employment with no more than 80% of the working hours of full-time employment
- your daily working hours have been shortened due to lay-off
- you have full-time employment for a maximum period of two weeks
- part-time entrepreneurship
- full-time entrepreneurship for a maximum period of two weeks
- the employer unilaterally turns your employment into part-time employment
Your work is deemed occasional when your full-time employment lasts a maximum of two weeks. This makes you eligible for adjusted daily allowance. The term intermittent work is used when referring to fixed-term employment in general. Fixed-term employment can be full-time or part-time.
Zero-hour contracts and other contracts where the amount of working hours are variable rather than fixed (e.g. 0–40 hours/week or 10–30 hours/week), as well contracts where the employee is called to work as needed, are called contracts with variable working hours. An employee can request a contract with variable working hours to accommodate their studies or if they otherwise so prefer. The employer, however, can only offer a contract with variable working hours when the amount of work they have available actually varies. However, you can be eligible for adjusted unemployment benefit when working under a zero-hour contract if the hours offered are very limited.
If an employee chooses to shorten their working hours on their own accord, they are not eligible for unemployment benefit.
How does part-time employment affect earnings-related allowance?
The amount of adjusted daily allowance is calculated by adjusting your earnings-related allowance with the income from your part-time employment. 50% of your paid income reduces the amount of your earnings-related allowance. The total of your income earned and your adjusted daily allowance cannot exceed the salary on which the allowance is based. At minimum, your adjusted earnings-related allowance equals Kela’s adjusted basic unemployment allowance you would be entitled to.
How much is the adjusted earnings-related allowance?
The amount of your adjusted earnings-related allowance varies each month depending on how much you work and how much earned income you are paid. To be eligible for earnings-related allowance, the working hours your salary is based on must not exceed 80% of the maximum working hours in the industry. If you exceed the working hour limit of 80% for your adjusted daily allowance, you are not eligible for the benefit. For the months during which you do not exceed the hour limit, your salary and your earnings-related allowance are adjusted. You are therefore eligible for adjusted earnings-related allowance in addition to the income earned for your part-time employment.
The working hours of a part-time entrepreneur are not monitored, and there is no working time limit. However, the income of a part-time entrepreneur is still adjusted against the earnings-related allowance. Adjusted daily allowance is paid for five days per week during the application period, including days on which you work. You can calculate an approximate amount of the adjusted allowance using the daily allowance calculator.
If you receive adjusted daily allowance, the days included in the maximum period calculation accumulate slower than if you received full daily allowance. When calculating the maximum payment period, the amount paid out as adjusted daily allowance is converted to full earnings-related allowance days. The amount of full daily allowance and adjusted daily allowance have an impact on how days accumulate when paying out daily allowance adjusted to the maximum period.
When does earned income affect the amount of the earnings-related allowance?
When the earnings-related allowance is paid as adjusted, payment-based method is used for adjustment. This means that earned income affects the unemployment benefit during the application period in which the salary is paid – not when the work was performed. For example, if you work in December but receive the salary in January, the adjusted income is deducted from the January allowance. What matters is the payment date of the salary, not when the work was done. Exceptions may apply if the salary is paid in a lump sum for several months; in that case, the income can be allocated across multiple months of benefits.
How does staggering affect adjusted daily allowance?
In autumn 2024, a legislative amendment on the staggering of earnings-related allowance entered into force. When staggering is applied, your daily allowance decreases at certain milestones as the period during which you receive daily allowance continues. The amount of your daily allowance is reduced to:
- 80% of the original when you have received daily allowance for a period of 40 days (approx. two months), and
- 75% of the original when you have received daily allowance for a period of 170 days (approx. eight months).
The staggering of earnings-related allowance also applies to part-time employment. However, the 40 and 170-day milestones take longer to reach in part-time employment, because full earnings-related allowance days accumulate slower. To get an estimate of your staggered daily allowance and to see how it is affected when your earned income is deducted, use the daily allowance calculator.
Does your job search need to be active when applying for adjusted daily allowance?
When applying for adjusted daily allowance, you must be registered as an unemployed jobseeker and keep your job search active with the employment authorities. Make sure to follow the agreed steps with the employment office to ensure your job search remains uninterrupted. You cannot receive adjusted daily allowance for any period during which your job search is not active.