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Unemployment insurance contribution

Unemployment insurance contributions are used to finance costs such as earnings-related unemployment benefits, adult education allowances, pension benefits and Kela benefits. The employee and employer are obliged to make unemployment insurance contributions and they both pay their own shares of them. The payment is made by the employer.

Employer is liable to pay unemployment insurance contributions if a total of more than EUR 1,300 is paid in wages per calendar year. In 2018, the payroll threshold was EUR 1,200. The unemployment insurance payment liability applies to employees who have turned 17 and are under the age of 65.

The liability to pay is based on the Act on the Financing of Unemployment Benefits (555/1998, the act is in finnish).

As of 2019, salaries and wages are reported to the Incomes Register, which provides up-to-date information to the Employment Fund.

Payment liability for unemployment insurance contributions

The employer’s liability for payment is affected by factors for example the payroll sum, ownership, company type and international circumstances.

Learn about payment liability
Payment liability for unemployment insurance contributions

Paying the unemployment insurance contribution

The employer pays both the employer’s and employee’s shares of the unemployment insurance contributions in accordance with the annual payment percentages.

Advice how to pay contribution
Paying the unemployment insurance contribution

Substitute payers and assisted persons’ liability to pay unemployment insurance contributions

Unemployment insurance contributions are paid for personal assistants whose salary costs are subject to compensation based on the Act on Disability Services and Assistance. The payment is paid either by the employer or a substitute payer.

Information for substitute payers
Substitute payers and assisted persons’ liability to pay unemployment insurance contributions

Training compensation

Bodies such as municipalities, parishes, associations and foundations are entitled to training compensation. The employer can apply for training compensation, which is deducted from the employer’s unemployment insurance contribution.

Advices how to apply training compensation
Training compensation

Liability component

The employer may be obliged to pay the employer’s liability component if it has dismissed or laid off an elderly employee and the employee has been unemployed or laid off for a long period.

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Liability component

Disputes over termination of employment and reconciliation in accordance with the Employment Contracts Act

An employer who has terminated an employment relationship in violation of the provisions of the Employment Contracts Act is liable to pay compensation to the employee. The Employment Fund acts as an expert in reconciliation situations, and is the recipient of the deduction in coordination matters.

Learn about reconciliation
Disputes over termination of employment and reconciliation in accordance with the Employment Contracts Act
Page updated: 22/3/2019