Government to increase maximum amount of pay security
The Government proposes to raise the maximum amount of pay security to EUR 19,000 from the current EUR 15,200 in order for it to better correspond with the current level of wages. The coronavirus epidemic is expected to increase solvency problems among companies, which in turn may lead to a growth in the number of employees applying for pay security and the amount of claims for it.
Employees have the right to receive their claims arising from an employment relationship paid by the State as pay security if the employer is bankrupt or otherwise insolvent. The maximum amount of pay security paid to an employee under the Pay Security Act has remained unchanged since 1999.
The maximum amount would be raised by amending the Pay Security Act. Similarly, the Government proposes to amend the Seamen’s Pay Security Act. The maximum amount of indemnity or compensation paid as pay security under that Act would also be increased to EUR 19,000 from EUR 15,200.
The amendments would come into effect as soon as possible. The government proposal is included in the third supplementary budget proposal for 2021.
Katariina Tirri, Senior Specialist, tel. +358 295 047 18