Brussels, Belgium. The European Parliament has approved an overhaul of EU social security coordination rules that would make the country of employment responsible for paying unemployment benefits to many cross-border workers. The measure now requires formal adoption by the Council, which is expected in September.
New responsibility for unemployment benefits
The Parliament approved the reform on July 7 by 511 votes to 87, with 61 abstentions. The proposal was first made nearly a decade ago.
Under the agreed rules, cross-border workers who have been employed, self-employed or insured in their country of employment for 22 uninterrupted weeks would receive unemployment benefits from that country, provided they meet national eligibility requirements.
The country of employment would pay benefits for six months. Responsibility would then transfer to the country where the unemployed person lives. Previously, the country of residence was generally responsible for providing the benefit.
Cooperation between national employment services
Employment services in the worker’s country of residence would be required to inform the paying authority about the person’s job search activity and compliance with activation or job-placement procedures.
The reform also provides that unemployed people moving to another EU country to seek work could continue receiving benefits from the country they left for six months, compared with the current standard period of three months. Member states could extend payments until the person’s entitlement expires.
National systems remain in place
The changes would not create a single European social security system. National governments would continue to decide who is insured, what benefits are available and the conditions attached to them.
The EU rules instead determine which country is responsible when a person’s employment, residence or insurance history spans more than one member state.
According to EU figures, about 16 million Europeans live or work in another EU country.
Transition period for Luxembourg
The impact of the reform is expected to differ across the bloc. In Luxembourg, where cross-border workers represent a large share of employment, shifting responsibility to the country of employment is expected to create a substantial administrative burden.
Luxembourg has secured an additional three-year transition period, which could be extended by a further two years.