Changes in Unemployment benefits for graduates from May 2023
Udgivet , opdateret . Kategori: dimittend, nøgleord: A-kasse, Dagpengesats, Nyuddannet
From 1 May 2023, a change in the law will come into force. It will have these important changes for graduates regarding right to Unemployment benefits as a graduate:
- graduates without dependent children will get lower amount in Unemployment benefits after the first 3 months of unemployment.
- there will be different Unemployment benefit rates for individuals under and over 30 years old.
- the period you can receive Unemployment benefits will be reduced from 2 year to 1 year.
- there will be a new language requirement for graduates.
Unemployment benefit rate
From 1 May 2023, the amount you can get as graduate (in danish: dimittendsats) will depend on:
- whether you have children or not. If you have, there is no reduction in the unemployment benefit rate - you will receive DKK 16,177 per month as full-time insured.
- whether you are under or over 30 years of age. If you are over 30, you will receive DKK 12,253 per month (after the first 3 months of unemployment). If you are under 30, you will receive DKK 9,700 per month (after the first 3 months of unemployment)
- In the first 3 months of unemployment (481 hours), both graduates over and under 30 without children get DKK 14,106 per month.
Period with unemployment benefits
The period for which graduates can receive graduate benefits (in danish: dagpengeperiode) will be reduced to 1 year, for all graduates who register as unemployed and apply for benefits after 1 May 2023.
So, while the lower unemployment benefit rate affects all graduates without children - including those already receiving unemployment benefit on 1 May 2023 - the shorter unemployment benefit period will only apply to those placed in the unemployment benefit system from 1 May 2023.
The 1 year/1,924 hours with unemployment benefits (in danish: dagpenge) has to be used within a 2-year reference period. Working hours that lead to an extension of the unemployment benefit period also mean that the reference period is extended.
New Language requirement
All graduates must possess a level of Danish equal to the level of Dansk 2.
Some programs can be equated with passing the test in Danish 2. You can see them "in this article".
An person who do not meet the language requirement, is still entitled to unemployment benefits if the person instead meet a affiliation requirement. The affiliation requirement says that during 12 months within a 24 month period prior to the unemployment there must have been reported at least 600 wage hours to the income-register (SKAT).
Working hours from another EEA country, Switzerland or Great Britain can be used to meet the 600 hours working requirement. However, the last wage hour must have been earned in Denmark, and in total you must have had at least 150 out of the 600 wage hours in Denmark.
When you use the aggregation rule (see below), you do not have to meet the new language requirement or affiliation requirement, as you get your right to unemployment benefit on the basis of paid work combined with education.
What can you do to avoid the deterioration of unemployment benefits?
You can avoid the shortened unemployment benefit period if you have the opportunity to graduate before 1 May 2023. If you do so, and register your graduate rights in the A-kasse before 1 May, you will receive a 2-year unemployment benefit period instead of just one 1-year period.
With regard to the dimittendsats (the rate you can get), you can avoid it if you have the opportunity to have your rate calculated according to the rules that applies for wage earners.
There are two options for calculating an ordinary unemployment benefit rate (in danish: ordinær dagpengesats) - the so-called "Sammenlægningsregel" and the option for a graduate to have the rate recalculated after 6 months.
In both cases, the A-kasse will calculate your benefit rate on the basis of salary income. In order for them to do this, you must have salary income from an employment relationship that ends after your education.
Aggregation rule (Combine education with income from work)
To use the aggregation rule (in danish: Sammenlægningsregel), you must:
- Have been a member of an A-kasse continuously - no later than 12 months before your education ended.
- Have had paid work after you have completed your education.
- Not having been paid unemployment benefit on the basis of your education.
When you use the aggregation rule, the A-kasse will check whether you meet the general conditions for unemployment benefit. This means 1 year's membership of A-kasse and meeting the income requirement. At the same time, you will get a 2-year benefit period, instead of a 1-year period following the graduate rule.
You must have earned/have had a gross income of at least DKK 254,328 (amount applicable in 2023) during the last 3 years (in total).
New graduates can meet the income requirement by combining reported income with the part of your education that precedes paid work. "The part which precedes" has been interpreted in several decisions as meaning that the (entire) education precedes the paid work, if only the last working day with an employer is after the end of the education.
A month's education can be included with DKK 21,194 in the calculation of whether the income requirement is met.
The DKK 21,194 is also the maximum amount you can include of your salary income for a month. Have you thus had a month with a salary income of e.g. DKK 30,000, you can therefore only include the DKK 21,194 to meet the income requirement.
It is important that you do not stop at your workplace until after you have graduated. In principle, it is enough that you have had only one hour of paid work after you finished your education and have not yet received unemployment benefits.
Furthermore, when you use the aggregation rule, it is only work and education during periods when you have been a member of A-kasse that can be counted towards fulfilling the income requirement.
Calculation of your Unemployment benefit rate
If you meet the income requirement (by combining salary with education), and thus will be eligible for Unemployment benefits, your A-kasse must calculate your unemployment benefit rate (ie how much you can receive in unemployment benefit). Here you must be aware that only salary income can be included in the calculation. Here, the education does not count as income.
The A-kasse must calculate your rate on the basis of the 12 best months of income from employment you have had while you have been a member of the A-kasse within the past 24 months. If you have worked for fewer than 12 months, e.g. 7 months, the unemployment benefits rate is calculated on the basis of the 7 months.
Please note that the calculated unemployment benefit rate is locked for the entire two-year unemployment benefit period.
So, its important that you seriously compare the calculated rate with the one you can get by using the graduate rule. However when using the graduate rule you only will get the benefits for one year. When using the aggregation rule you will get a two-year unemployment benefit period. On the other hand, when using the aggregation rule, you will not be able to use the recalculation rule for graduates (see below).
As you can see there are pros and cons by using the aggregation rule, so we strongly recommend that you contact your A-kasse to get som advice for your particular case.
Recalculation of unemployment benefit rate after 6 months
If you choose to make use of your graduate rights, you can have an individual and perhaps better unemployment rate calculated if:
- you have been paid a salary for at least 3 months after you completed the education, and
- at least 6 months have passed since you completed the education.
You do not need to have been unemployed, just entitled to unemployment benefit for the 6 months.
You must be aware that the A-kassen calculates your new rate on the basis of all the months with income (but a maximum of 12 months) after graduation. Do you have had e.g. small part-time jobs or continued in a student job with few hours, this may therefore have a negative impact on your new unemployment benefit rate.
I case you consider using this option for recalculation, we strongly recommend that you ask the A-kasse to make a calculation for you before you accept a new unemployment benefit rate.