The member of management board is again entitled to receive unemployment insurance benefits.
21.07.2017
Attorneys-at-law Annika Vait and Epp Lumiste wrote about a recent judgment of the Supreme Court which states that members of management board again have the possibility to register themselves as unemployed and receive unemployment insurance benefits.
On 11 May 2017 the Supreme Court declared Section 6(5), pt. 4 of Labour Market Services and Benefits Act to be in conflict with the Constitution. The named provision did not allow a member of management board to register themselves as unemployed not even when the member of management board had lost income which was related to membership of the management board. The legislator’s justification for this provision was that membership of the management board is equal to working under an authorisation agreement, which means that the member of the management board is not unemployed. Whether or not a member of the management board was paid for the work was not considered important by the legislator.
The Chancellor of Justice raised awareness of this issue already in December 2015, but parliament of Estonia left it without discussion. In 2016, the Chancellor of Justice had recourse to the Supreme Court in order to repeal the aforenamed provision. The Supreme Court agreed, saying that members of management board who have lost income shall have the possibility to register themselves as unemployed and are entitled to receive unemployment insurance benefits.
Read more on http://rup.ee/ and http://palk.aripaev.ee/
Questions regarding this post can be discussed with Annika on annika@alternalaw.ee and Epp epp@alternalaw.ee on or by calling 680 6850.
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