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Changes to adult education allowance as of 1 August 2020

NEWS 27.2.2020 13.40

On 27 February 2020, the Finnish Government proposed a bill to Parliament to amend the application process for employees’ adult education allowance, the amount of allowance, the accumulation of allowance months, and study performance requirements. The new bill will not affect entrepreneurs’ adult education allowance. The changes seek to facilitate the coordination of studies and work and bring adult education allowance available to a larger number of employees.

The proposed amendments concern those employees who apply for adult education allowance for new studies from 1 August 2020 onward. Adult education allowances will continue to be granted under current rules until 31 July 2020.

The requirements and amount of adult education allowance will remain unchanged for current students who continue previously begun studies. Current recipients will continue to receive the allowance under the present requirements until 31 July 2024.

Coordination of work and studies more financially attractive than before

In the proposed legislation, adult education allowance would continue to consist of a universal basic component and a personal earnings-related component. Earned income during months of allowance would cut the amount of adult education allowance less than under the current model. Currently, any additional income over 250 euros lowers the amount of allowance significantly.

For full-time students, the amount of allowance would be lower than the current full allowance. Average adult education allowance would shrink by about 78 euros per month, from the average of around 1,400 euros in 2019.

Working affects the accumulation of allowance months and study performance requirements

Adult education allowance may be received for up to 15 months over an employee’s work career. In the future, allowance months could be spent as either full or half months, depending on your income during the months when you receive allowance. If your income is over half your normal pay, only 0.5 of an allowance month is spent. Conversely, if your income is below half your normal pay, the full allowance month is spent.

The accumulation of allowance months is tied to study performance requirements. During months that count as one half of an allowance month, at least two study credits must be earned. Otherwise, the number of required study credits is four.

After an initial approval, allowance is applied monthly in arrears

Starting next August, an initial approval is required for adult education allowance. When applying for the initial approval, the employee must have a notice of study leave granted by the employer and a certificate of attendance at an education institution. You can apply for the initial approval at least four months in advance for a period of up to 15 months. If applying retroactively, initial approval may be granted for a period of up to six months before the application.

With the initial approval, the employee receives confirmation that they meet the conditions for eligibility to adult education allowance. For as long as the initial approval remains valid, recipients may flexibly claim allowance for the number of months necessary.

Recipients apply to receive the allowance monthly in arrears. In processing applications, we use payroll information from the Incomes Register. Salaries and wages, benefits and other income affect the amount of allowance, depending on their date of payment. As of 1 August 2020, all income will be recognised based on when they are paid, not when they are earned. This applies to both new applicants and those starting studies before 1 August 2020.

During 2019, the Ministry of Social Affairs and Health has worked with central labour market organisations to draft proposals for changes in adult education allowance on the basis of development suggestions from the organisations. The Employment Fund has participated in drafting the proposals. The first circulation for comments on the proposals ended on 1 November 2019.

Further information:

Merli Vanala, Director, Customer Relations, merli.vanala@tyollisyysrahasto.fi tel. +358 40 841 8201

Further information:

Changes to employees’ adult education allowance as of 1 August 2020 

News 30 September 2019 Changes proposed to the adult education allowance