Estonia: merger of unemployment payment services and employment services on 1st May 2009

Providing an improved service. Since 4th May, these two institutions have been merged and the resulting organisation has retained the name of the Estonian unemployment insurance fund (Eesti Töötukassa). This restructuring was aimed at improving the quality of employment assistance services and ensuring that these services and measures aimed at improving the operation of the labour market are undertaken coherently. The Ministry for Social Affairs pointed out that the grouping together of these two institutions’ activities was going to make it easier to deal with the problems of unemployment and offer an improved and broader range of services to assist the return to work. This law in no way changes the provisions and principles of employment services as envisaged and defined in the unemployment insurance act and neither has it affected the payment of unemployment benefits or any other compensation paid out to assist the return to work. This new act is based on the agreement signed between the state and the employers and trade unions, on 28th April 2008, with a view to preparing the labour contract act, which considered a reorganisation of institutions relating to the labour market. This merger is also going to reduce excessive bureaucracy and renew an obsolete information system: in 2008, administrative costs totalled 5,500 Estonian crowns (approximately 350 euros) per unemployed person. The objective is to bring this down cost to a maximum of 2,500 crowns (apprroximately160 euros) per unemployed person as a result of this merger.