A new pay-related social welfare payment for jobseekers is set to come into force later this year, seeing higher earners receive larger payments if they lose their jobs, after the legislation was passed in the Oireachtas.
The Social Welfare (Miscellaneous Provisions) Bill 2024 was passed in both Houses of the Oireachtas this week. The Bill provides for changes in the manner in which employment contributions are to be calculated, to provide for a new benefit to be known as jobseeker’s pay-related benefit.
It will also remove the need for certain notifications to be provided to persons who are the subject of certain investigations before a notice of attachment may be given to such persons. The legislation also amends and extends the Social Welfare Acts and the Taxes Consolidation Act 1997, along with the Public Service Pensions (Single Scheme and Other Provisions) Act 2012.
Minister for Social Protection, Heather Humphreys TD, this week announced that the Bill will now be presented to President Michael D Higgins for signing.
The Bill provides for a shake-up of Ireland’s social welfare system, and will mean that those with a solid work history who become unemployed and claim Jobseeker’s Benefit will receive enhanced benefits, in line with their previous salary, as reported by The Irish Mirror.
Ireland will join a number of other countries that already have similar systems in place. At present, Ireland is one of only four EU member states (along with Greece, Poland and Malta) which pays the same flat-rate payment to all unemployed workers, despite employees paying PRSI contributions when employed.
The current system means that those who lose their jobs receive a flat weekly rate of €232 in Jobseekers’ Benefit. The new rules, set to come into effect before the end of the year, mean that high earners who become unemployed would be entitled to almost twice the normal social welfare rates.
Under the new Pay-Related Jobseeker’s Benefit, workers with a strong attachment to the labour market and at least five years of paying PRSI contributions will receive 60 per cent of their previous gross weekly wage up to a maximum €450 a week, the Mirror reports.
After that, the rate will drop to 55 per cent of earnings, which will be subject to a maximum of €375 for the following three months – while a further three months will be paid at the rate of 50 per cent, up to a maximum payment of €300.
For those who have between two and five years worth of paid contributions, the rate will be set at 50 per cent of previous earnings, subject to a maximum of €300 weekly and for a duration of six months.
The scheme is set to be available to those who become fully unemployed after the commencement of the scheme, and who are genuinely seeking to become employed. Those who lose their job before the date, however, will receive the existing Jobseekers’ Benefit.
Speaking following the passing of the Bill, Minister Humphreys said: “At the moment, when a person who has worked hard for twenty years suddenly loses their job, they receive the same rate of unemployment payment as somebody who might never have worked. That’s not fair.
“We need to reward the people who have worked hard; paid their dues; and contributed to the economy through their PRSI contributions. That’s what Pay Related Benefit is about.
“This is about supporting workers who lose their employment by ensuring they don’t suffer a cliff-edge drop in income.
“The reality is people enter into financial commitments which are commensurate with their income.
“When I worked in the Credit Union sector, I saw it first hand; people who had good jobs, who worked hard, and then all of a sudden when they lost their job, they had a cliff-edge drop in income and they weren’t able to meet the mortgage payment. It put families under huge stress. Pay Related Benefit is about giving those people a safety net,” she said.