Working when receiving allowance

You can do part-time work, gig work or start a small-scale business while receiving unemployment allowance

Small-scale work is worthwhile, as it allows you to:

• Increase your earnings
• Extend the maximum payment period of the daily allowance
• Accumulate new working weeks and leads to the maximum payment period for the daily allowance resetting.

Half of any income from work reduces the daily allowance by half. For example, a salary income of 500 EUR will reduce the daily allowance by EUR 250. You can estimate how your salary will affect the daily allowance using the allowance calculator.

Receiving allowance during work is possible, when you

• have a part-time job (working hours max. 80 %)
• have a full-time job that lasts for no more than two weeks (so called gig job)
• are part-time self-empoyed
• have been temporarily laid-off.

If you have found a part-time or gig job

You should report your working hours in your application to the unemployment fund and also send the fund a salary slip. Remember to also inform the TE Office about this work.

If you will only receive a salary payment in the following month, the job will not affect the payment of your daily allowance before the salary payment.

What kind of work is part-time work, gig work, and full-time work?

Part-time work is work done up to 80% of the maximum working time permitted in the sector in question. If the line of industry has a maximum working time of 40 hours per week, 32 hours per week constitutes part-time work.

Gig work is full-time work that lasts no more than two weeks.

The time spent in part-time or gig work is assessed according to the payment period. This means that the 80% limit may not be exceeded during the application period, which is a month or four weeks.

If the work exceeds the 80% ratio and it lasts for more than two weeks, it will be considered to be full-time work. In this case, you will receive the full daily allowance until you start work and after its eventual termination.

If you have started a business

Having a small-scale business affects the daily allowance in the same way as part-time work. Send your last tax statement showing your income from the business to your unemployment fund. If you have just begun a business and have not yet completed a tax return, please send your own explanation of the company’s income and expenses.

You can estimate the impact of your income on the daily allowance using the allowance calculator. Change the income stated in your annual income tax statement to monthly income by dividing the amount by 12.

The TE Office will evaluate how extensive your business activity is and decides whether the business activity is sufficiently small to allow payment of the earnings-related allowance. In general, a business that has been practiced alongside full-time employment for 6 months does not prevent payment of the daily allowance.

If a business is started while being unemployed the scale of the business will not affect you right to earnings-related allowance for the first 4 months. This means that, other than in relation to your income, the first 4 months of business activity do not affect your daily allowance. After 4 months, the TE Office will check to see if this business activity is small-scale enough for you to still receive unemployment benefits. You can only start your business in this way once within the maximum payment period of the earnings-related allowance. In the future, the scale of the business will be checked immediately.

If your business activity lasts for no longer than two weeks, the scale of the business will not be evaluated at all. You can have any number of periods of business activity lasting up to 2 weeks during the maximum payment period.

The TE Office must be informed of any business activities lasting more than 2 weeks. Your unemployment fund must be notified of all business activities as the income will affect the amount your daily allowance.

You can work as an employee or an entrepreneur through a cooperative

If you are working through a cooperative or a company that manages invoicing and accounting on your behalf, this is usually considered to be business activity. In this case, you acquire your customers and they agree to work with you.

If you are working in a cooperative that provides services in the same field as the one in which you are working, this is often considered to be an employment relationship. In this case, customers purchase services from the cooperative, and not from you directly.

What is the maximum daily allowance?

In cases in which the effect of your work-related income is taken into account in the payment of a daily allowance, the combined value of the daily allowance and the work-related income cannot exceed the value of the salary on which receipt of the daily allowance is based.

If your daily money has been reduced on the basis of the maximum payment amount, this means that your earnings are equal to the income on which your daily allowance is calculated.

However, the daily allowance is always of at least equal value to that of the payment made if the allowance were to be paid as a basic daily allowance.

Recalculate daily allowance and payment protection

If you are at work for 26 weeks (6 months) with a minimum of 18 hours of work during the week, the maximum payment period of the earnings-related allowance starts again from the beginning and the level of the daily allowance is recalculated. The seven-day personal liability period also starts anew.

The new daily allowance level is calculated even if there were unpaid days in the previous daily allowance period.

If you are in part-time work, recalculating the daily allowance can lead to a reduction in the amount paid. However, the level of the daily allowance is protected by the following factors:

• The earnings-related daily allowance is calculated and the personal liability period occurs no more than once a year.
• The daily allowance can may only be reduced by 20% at a time if there are unpaid days in the previous daily allowance period.

A few other payment protection factors apply to older adults. The salary on which the daily allowance is based will not be recalculated unless the salary has increased in the case of persons aged 58 years or older. Furthermore, when the maximum payment period starts again from scratch on the basis of starting a job or using a service provided on the basis of the employability enhancing obligation, the salary on which the daily allowance is based is not normally recalculated.