Coordination of unemployment benefits An overview of the current rules in Regulation 883/2004
trESS Seminar UK, Nottingham, 26 June 2013 Filip Van Overmeiren
Background thoughts UB = “benefit covering the risk associated with the involuntary loss of revenue whilst still being able to work” (no definition in Reg. 883/2004) Close links with general employment policy of the Member States + decisive “availability for the labour market” Connected to state of the labour market Control on active job seeking
Activating measures (longer working, youth unemployment, contribution/benefits)
Essential: supervision on job seeking efforts → residence clauses >< EU law (but: permitted by Regulations) Not “fully coordinated”
Main coordination principles Lex loci laboris for applicable legislation (limited, cf. “frontier workers”) Equal treatment Aggregation of periods (limited, cf. “periods of insurance”) Assimilation of facts/income/benefits (limited, cf. “calculation of benefits”) Export of benefits (limited, cf. “strictly conditional export”)
Principle: lex loci laboris •
Vincent, a Belgian national
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Works in UK
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Resides in UK
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Becomes unemployed
Principle: lex loci laboris If one becomes unemployed in a Member State, the latter will apply its legislation (+ equal treatment principle) Principle: Competent state (applies its unemployment legislation/grants benefits) = state of last employment Article 11,2: person receiving unemployment benefits is regarded as pursuing his former activity which gave rise to the receipt of those benefits
>< Article 11,3,c: person receiving UB from his MS of residence (cf. frontier workers) in accordance with Article 65 are subject to the legislation of that MS
Principle: Aggregation of periods •
Peter, a Dutch national
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Resided and worked in Belgium for 5 years
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Moved with his family to Germany to work there
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Becomes unemployed after 6 months
Aggregation of periods (Art. 61 BR): Qualifying periods [1-2 years insurance / (self-)employment]
If the acquisition, retention, recovery or duration of the right to unemployment benefits is conditional upon fulfillment of periods of insurance, employment or self-employment
Aggregation rules fully apply to all periods in another MS
Portable document “U1”
BUT: If the right to unemployment benefits is conditional upon completion of periods of insurance
Periods of employment or self-employment in another MS are only aggregated to the extent that they would qualify as periods of insurance had they been completed under the applicable legislation
For the application of the above aggregation rules: abovementioned periods need to be most recently completed in the MS where the claim is submitted
Calculation of benefits (Art. 62 BR): If based on the amount of the previous salary or professional income ONLY salary/income received for last activity as (self-)employed person under that legislation is taken into account
Idem for reference periods for the determination of the salary serving as the calculation basis BUT: When receiving UB from the MS of residence: salary / professional income in MS of last activity is taken into account
Principle: Export of benefits •
Franz, a German national
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Resided and worked in Denmark for 5 years
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Becomes unemployed
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Wants to look for a job in Spain
Export of unemployment benefits: Principle of non-exportability (accepted by ECJ, cf. Testa)
Export possible, but under very strict conditions:
Registration for at least 4 weeks with the employment service of the competent state before departure (derogation possible)
Registration with the employment service of state of job seeking + subject to control procedure and conditions (deemed to be fulfilled before registration if registered within 7 days after end of availability in competent MS)
Return to the competent state within 3 months – extendable up to 6 months
Returning in time = continued entitlement in competent MS, if NOT:
SANCTION: loss of benefits, unless more favourable legislation of competent MS
Export is permitted several times per unemployment period (in total maximum 3 or 6 months)
Export of unemployment benefits: Benefits are paid directly by the institutions of the competent state Practical approach
Prior to departure – application for document confirming right to benefits in competent state (U2-form)
Information obligations vis-à-vis the unemployed person
Information exchange between institutions of both states
Control by institutions of state of stay
Special rules for workers who resided outside the competent MS •
Pierre, a French national
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Works in Belgium
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Resides in the Netherlands
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Returns home every day
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Becomes unemployed
OR •
Sean, an Irish national
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Performs seasonal work in France
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Resides in Poland
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Becomes unemployed
Special rules for workers who resided outside the competent MS A.
Frontier workers 1. “Typical” frontier worker = person employed in the territory of a state other than the state of residence (return at home at least once a week) – best chances in MS of residence(?) 2. A-typical frontier worker = frontier worker maintaining close personal and business links in the state of last employment giving him better chances of finding new employment there (Miethe-case)
B.
Workers residing outside of the competent state, other than frontier workers e.g. seasonal workers, international transport workers, other workers simultaneously employed in different MS
C. Wholly or partially/intermittently unemployed depending on contractual link with employer – cf. employment relationship suspended (duration irrelevant) = partially unemployed
Frontier workers 1.
Frontier worker
Partially or intermittently unemployed Legislation of the state of employment (available to employer/employment services, benefits)
Wholly unemployed Legislation of the state of residence (available to employment services, benefits)
Optional registration as job-seeker in state of last activity
Frontier workers 2. A-typical frontier workers Partial or intermittent unemployment Legislation of the state of employment (available to employer/employment services, benefits)
Full unemployment Legislation of the state of last employment (available to employment services, benefits) Jeltes: UB from MS of residence + optional registration in MS of last activity, but no benefits (ECJ legislator wins)
Workers who resided outside the competent MS, other than frontier workers Partially or intermittently unemployed Legislation of the state of employment
Wholly unemployed
Availability to employment services and benefits Legislation of the state of last activity (if no return to MS of residence) Legislation of the Member State of residence (upon return there) However, upon return after receiving benefits from MS of last activity:
as long as export is permitted (3/6 months)
afterwards
benefits from MS of residence
benefits from MS of last activity
Workers who resided outside the competent MS, reimbursement between institutions Principle: if benefits provided by the MS of residence benefits at expense of MS of residence Exception: reimbursement by the MS of last activity
3 months (full amount of the benefits)
5 months, if at least 12 months of (self-)employment within the state of last submission during the 24 months preceding the unemployment
Capped reimbursement: maximum = amount of benefits in state of last activity
•
Rosita, a Spanish national
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Works as a self-employed person in Portugal
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Resides in Spain
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Returns home every day
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Becomes unemployed
Self-employed workers residing outside the competent Self-employed activities in MS of last activity But no unemployment benefits system for self-employed persons in MS of residence MS of last activity (available to employment services and benefits)
As a supplementary step: available to employment services of MS of residence
Switch possible to availability to employment services of the MS of residence only, using the limited export possibility – export possibility may be extended from 3 months till the end of benefit entitlement
Challenges
Different interpretation of the aggregation principles Limited export vs. labour market reality Limited export vs. EU citizenship case law Different criteria for extension of export period Residence state principle vs. jobseeking reality Residence state principle vs. fair burden sharing Residence state principle vs. administrative burden Problems with PD’s and SED’s (wrong, delayed, …) and monthly Different interpretations of case law (cf. Miethe (/Jeltes), Huijbrechts) Determination of the MS of residence
Thanks for your attention!
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