20.12.2023
Amendments to the Unemployment Allowances Act 1 January 2024
The amendments concerning the personal liability period and the postponing effect of holiday compensation will enter into force on 1 January 2024. In 2024, several changes will also be made to the Unemployment Allowances Act concerning, among other things, the employment requirement and the abolition of child supplements and the exempt amount.
Personal liability period to be extended to seven days
Payment of earnings-related unemployment allowance can begin after the expiry of the personal liability period applied to the unemployed job-seeker. The personal liability period is five days if at least the first day of the period falls within 2023. The duration of personal liability periods that start on or after 1 January 2024 is seven days. Saturdays and Sundays do not count towards the personal liability period.
Holiday compensation to postpone the payment of unemployment allowance
Going forward, holiday compensation paid upon the end of full-time employment that lasted for more than two weeks will postpone the payment of unemployment allowance. The period that the payment is deemed to cover begins from the end of your employment. This means that compensation paid for unused annual leave postpones the start of eligibility to earnings-related unemployment allowance. For example, holiday compensation equal to one month's pay postpones the start of your eligibility to earnings-related unemployment allowance by approximately one month.
The legislative change concerns holiday compensation paid on the basis of an employment relationship ending on or after 1 January 2024.
The postponement due to paid holiday compensation and the personal liability period will not overlap. The personal liability period begins after the postponement period corresponding to the holiday compensation received (if any).
The earnings-related unemployment allowance will not rise at the start of next year
Parliament has approved the Government’s proposal to freeze index increases from 2024 to 2027. This means that unemployment benefits will not be increased annually. Normally, benefits are adjusted in line with rises in consumer prices.
As a result of the index freeze, earnings-related unemployment allowances will not increase at the start of next year. This change also applies to alternation and mobility allowances.
Upcoming legislative changes
Child supplements to be abolished on 1 April 2024
Parliament has decided to abolish the child supplements in unemployment security as of 1 April 2024. There will be no child supplement entitlement for days of unemployment from 1 April 2024 onwards. Child supplements will be paid as before for the period up to 31 March 2024, even if the payment date is after the change takes effect.
Abolishing child supplements will reduce the benefit by an average of €150–€280 per month, depending on the number of children.
The abolition of child supplements will also affect the mobility allowance.
Exempt amount of earned income to be abolished on 1 April 2024
Exempt amount means the amount you can earn from part-time or gig work without it affecting your earnings-related unemployment allowance. Parliament has decided to remove the exempt amount of earned income as of 1 April 2024. In the future, half of the earnings before taxes paid during the application period for earnings-related unemployment allowance would reduce the amount of allowance. For example, if a person earns €500 doing gig work, the full earnings-related unemployment allowance paid for the whole month is reduced by half of this amount (€250).
Until 31 March 2024, the exempt amount is €300 for a one-month application period. Half of the earnings in excess of the exempt amount are deducted from the earnings-related unemployment allowance.
Employment requirement to be extended to 12 months on 2 September 2024
Parliament has decided to extend the employment requirement from 26 weeks (approximately 6 months) to 12 months as of 2 September 2024. The change means that 12 months of work are required to fulfil the employment requirement.
Until 1 September 2024, an earnings-related unemployment allowance can be received after 26 calendar weeks, or approximately six months, of employment.
It will not be necessary to accrue the employment requirement from continuous periods of employment: the fulfilment of the requirement will be assessed over a 28-month period. Extension of the review period on acceptable grounds will also remain unchanged.
Employment requirement to be based on pay instead of hours worked as of 2 September 2024
Parliament has decided that as of 2 September 2024, the employment requirement will accrue based on earnings rather than working hours. A calendar month can count towards the employment requirement if the employee earns at least €930 gross in that month.
The employment requirement could also be accrued as half-months if the earned income in the calendar month is at least €465 but less than €930.
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