On 27 March 2014 the parliament adopted legal amendments according to which neither a procuration holder nor an executive of a company (management board member, shareholder authorised to represent a general and limited partnership, manager of a foreign branch or director of a non-resident permanent establishment) can be registered as unemployed. The reason for not allowing executives to register themselves as unemployed is that the purpose of the company is to earn a profit and it is an executive’s free choice to fulfil their duties without remuneration.
The executives of a non-profit association (MTÜ) and foundation (SA), and members of management and control bodies of a company other than executives (supervisory board member, founder, and liquidator) can be registered as unemployed if they do not receive any remuneration for their activities. This enables unemployed persons to work for a non-profit purpose.
Only the registered unemployed are entitled to employment services and subsidies such as unemployment insurance benefit, employment subsidy, and training from the Employment Insurance Fund.
According to the law currently in force, an executive of a company can be registered as unemployed if not receiving any remuneration for their activities. The members of a management or control body of a non-profit association (MTÜ) and (SA) can be registered as unemployed if their remuneration does not exceed half the minimum wage.
As part of implementing the new system, executives who are registered as unemployed on 1 May 2014 are allowed to maintain their unemployment status until 1 November 2014. Members of a managing or directing body who would like to maintain their unemployment status must terminate their activities as an executive from 1 November 2014. Otherwise, their registration will cease on 1 November 2014. Members of a management or directing body of a non-profit association (MTÜ) and foundation (SA) can continue to be registered as unemployed after 1 November 2014 on condition that they do not receive any remuneration for their activities. In that connection, expenses received for use of personal vehicle, telephone, and other similar items are not considered as remuneration.