Changing the unemployment insurance system must not increase costs and has to motivate people back to work

The Ministry of Economic Affairs and Communications has drafted a bill introducing a new type of benefit in the unemployment insurance system in addition to the unemployment insurance benefit – a base rate unemployment insurance benefit, while the current unemployment benefit will be abolished. As a result of the change, in case of job loss, either the current income-based unemployment insurance benefit or the base rate unemployment insurance benefit will be paid. The Chamber believes that the unemployment insurance contribution rate must not increase as a result of the changes, and the new system must motivate people to return to work.

The Unemployment Insurance Contribution Rate Must Not Change as a Result of the Amendments
As a result of the planned changes, the types of unemployment insurance benefits will be income-based and base rate unemployment insurance benefits. Changing the system and establishing the base rate unemployment insurance benefit will lead to a significant increase in costs for the Unemployment Insurance Fund in the coming years. The Unemployment Insurance Fund is financed by unemployment insurance contributions, and without additional funding from the state, it is likely that the unemployment insurance contribution rate would need to be increased. Therefore, there is a real risk of a tax increase for businesses, which are already under significant pressure in the current economic situation. The Chamber of Commerce believes that as a result of the changes, the unemployment insurance contribution rate must not increase, and the unemployment insurance system should be reviewed in such a way that costs do not increase and businesses are as protected from additional costs as possible.

The New System Must Support Returning to Work
In the feedback submitted to the Ministry, the Chamber pointed out that the planned base rate unemployment insurance benefit system must motivate working, not staying registered as unemployed and receiving benefits. For example, occasional jobs can bring a reasonable income to people when combined with unemployment insurance benefits, and as a result, people may not be motivated to return to work. The Chamber believes it is important to reduce the risk that people are not motivated to return to work, and the base rate unemployment insurance benefit system must specifically motivate working.

According to the bill, the planned changes will come into force on July 1, 2025.