Employers' interest in pay subsidy has increased

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The purpose of pay subsidies is to help job seekers find employment in the labour market.

As an employer hiring an unemployed job seeker, you can receive financial assistance for 50 to 70 per cent of the payroll costs. In certain situations, an organisation, foundation or registered religious community may receive a pay subsidy covering 100% of the payroll costs. The amount of subsidy granted is between EUR 1260 and 2020 per month, depending on the grounds for granting.

A pay subsidy may be granted when an employer employs an unemployed person, who has deficiencies in their vocational skills or permanent disability or illness that reduces their chances of getting a job, or who is a long-term unemployed person aged 60 or over.

There is also employment subsidy, which is available for employing people aged 55 or over. To receive it, the unemployed job seeker, hired for the employment relationship, must have reached the age of 55 and have been unemployed for at least 24 months, in the 28 months immediately preceding the granting of the employment subsidy. The amount of employment subsidy is 70% of the payroll costs, but no more than EUR 1770 per month.

Make use of the new employment subsidy for those aged 55 or over

The reform generated more questions about pay subsidy

The pay subsidy for employing an unemployed job seeker was reformed, in July 2023.

– Pay subsidy is arousing increased interest. A large proportion of the enquiries are related to the e-services of the pay subsidy application, says Senior Business Specialist Teemu Korhonen from the Enterprise Finland Telephone Service.

Most employers and employees applying for pay subsidy meet the conditions. If you have laid off personnel for production-related and financial reasons, within the last 12 months, pay subsidy may not be granted. It is also good to remember that pay subsidy cannot be applied for an employment relationship that has already begun.

– Typically, the employer already has a suitable employee in mind, when applying for pay subsidy. If this is not the case, the employer can notify the TE Services of their willingness to hire an unemployed job seeker. The decision on granting the pay subsidy is made by an expert of the TE Office or local government pilot. The subsidy is applied for electronically in the Regional Administration's e-service for employment and economic development services. No appendices are needed, and the decision is usually delivered in about two weeks. The duration of the pay subsidy and applying for an extension varies by case. The payment must be applied for separately on a monthly basis. Assistance is available via telephone at Enterprise Finland Telephone Service, says Korhonen.

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