The Chancellor of Justice Indrek Teder argues that the Unemployment Insurance Act1 is contrary to the principle of equality enacted in the Constitution of the Republic of Estonia2. The law leaves an unemployed who is insured in case of unemployment without unemployment insurance benefits or allows paying benefits for significantly shorter period, if the employer has calculated and withheld unemployment insurance tax from the employee’s pay for every month, but has not transfered the unemployment taxes monthly to the bank account of the Tax and Customs Board.
The Unemployment Insurance Act (§ 7 section 2) enacts that one month towards an insurance period shall be calculated for an insured person for each calendar month during which the insured person received remuneration from which unemployment insurance premiums have been withheld. From the complaints submitted to the Chancellor of Justice appears that in some cases the employer have not paid unemployment insurance tax monthly to the bank account of the Tax and Customs Board, but in just one month for several months. For example, an employer has paid to an employee who is going to a longer holiday at once both salary and holiday pay or an employer has paid to an employee who had a fixed-term contract for 12 month at once both salary and the final bill. According to the current law, those employees may not be entitled to the unemployment insurance benefits or the period when they may be entitled to the benefits could be significantly shortened. This is because the length of the insurance period is calculated on the basis of month, when the unemployment insurance tax was transfered on behlaf of the employee to the bank account of the Tax and Customs Board, not on the basis of months when the tax was actually calculated and withheld from the employee’s pay. The Chancellor of Justice finds that the law treats people in case of unemployment unreasonably differently based on the actions of an employer and whether the employer have paid the tax to the Tax and Customs Board monthly or in one month for several months. The Chancellor also stressed that an employee him/her self has little possibilities to pressure an employer to pay the unemployment insurance tax on behalf of him/her every month.
Although the legislature intended to have an unemployment insurance system that is easily and efficiently controllable, the Chancellor of Justice finds that an easily administrable system does not justify unequal treatment of persons.
The Chancellor sent a proposal to the Riigikogu to bring the Unemployment Insurance Act into conformity with the constitutional principle of equality.
1 Available in English: http://www.legaltext.ee/text/en/X50053K9.htm.
2 Available in English: http://www.legaltext.ee/text/en/X0000K1.htm.