Government to extend unemployment benefit for entrepreneurs

Entrepreneurs and self-employed people are entitled to labour market support because of the coronavirus pandemic under a temporary amendment to the Unemployment Security Act in force until the end of March.

On 18 February 2021, the Government submitted a proposal to Parliament to extend the right of entrepreneurs and self-employed persons to labour market support until 30 June 2021. The aim is to ensure the livelihood of entrepreneurs and self-employed persons during the pandemic.

“The coronavirus pandemic is making it very difficult for entrepreneurs and self-employed persons to work, and unfortunately there is no quick relief in sight. It is clear that we need to continue their right to labour market support,” says Minister of Employment Tuula Haatainen.

“Labour market support for entrepreneurs plays a significant role during the pandemic. In the autumn, on average 22,000 persons received the support per month,” says Minister Haatainen.

Last year, the Social Insurance Institution of Finland (Kela) paid labour market support to 44,000 entrepreneurs and self-employed persons for a total amount of 165.7 million euros.

What are the conditions?

Labour market support is one form of unemployment benefits. Entrepreneurs and self-employed persons are entitled to labour market support under the temporary amendment if:

• Their full-time employment has ended
• The monthly income from their entrepreneurial activities is less than 1,089.67 euros per each person engaged in these activities as an entrepreneur.

The end of the person’s full-time work or the reduction in income must be due to the coronavirus epidemic. 

Entrepreneurs do not need to close down their business to be eligible for labour market support under this temporary amendment. If they do  it, they become eligible to unemployment benefit under the general provisions of the Unemployment Security Act.

How to apply

1. The entrepreneur registers as an unemployed jobseeker and provides an account of the termination of their full-time employment or decrease in income due to the coronavirus epidemic.
2. The TE Office issues a labour policy statement to Kela.
3. The entrepreneur applies to Kela for labour market support.
4. Kela pays the labour market support to the entrepreneur.

In addition to the extension of labour market support for entrepreneurs, the Government proposes to extend also the increased exempt amount of the unemployment benefit and other exceptions to the unemployment security introduced because of the coronavirus epidemic.

These proposals will be discussed in Parliament alongside the first supplementary budget proposal for 2021.