Measures to promote the social security of the self-employed Some examples from Austria

Unemployment insurance 1 Entered into force on 1.1.2009 Voluntary insurance Change between employed and self-employed activities is easier Accrued entitlements to benefits because of unemployed activities are not lost while self-employed

Unemployment insurance 2 Opting in within 6 months after the start of the self-employed activity Next possibility to join the voluntary insurance after 8 years Opting out again possible after 8 years Insurance ends automatically when the person concerend completes the age of 60 or entitlement to early pension

Unemployment insurance 3 The self-employed can choose between three contribution rates. Contribution rate: 6% Contributions/month: 74,50 or 147,00 or 220,50. Benefit/day: 19,72 or 31,42 or 43,18 Change of decision not possible.

Unemployment Insurance 4 Coordination problems: MS without a scheme for self-employed wouldn‘t pay benefits to former frontier workers These persons also lose benefits from former state of employment „Miscelleaneous Amendments“ 2010 under discussion Aggregation with our without periods as self-employed? How would ECJ decide?

Insurance of „new self-employed“ 1 Entered into force on 1.1.1998 Before: insurance of self-employed was linked to formal criteria: being member in the „Chamber for the Economy“ or associate of certain business companies Membership in the Chamber is open and compulsory only to a number of professions which require a trade licence The definition of „new self-employed“ covers all self-employed who do not fall under other provisions

Insurance of „new self-employed“ 2 Examples for „new self-employed“: Lecturers Artists Journalists certain medical professions (midwifes, physiothereuopists, psychologists) all persons who owe a certain success on a contractual basis but are neither employed nor engaged in a business for which a licence is necessary

Insurance of „new self-employed“ 3 Compulsory insurance Minimum yearly income condition for insurance: € 4.488,24 if also other earnings or benefits OR € 6.453,36 if no other income At the beginning declaration that income will reach these amounts possible; cannot be changed if it turns out later that this assumption was wrong

Share of the general budget for pension schemes Scheme for the employed: Contribution 22,8% - employee: 10,25%, employer: 12,55% 81% covered by contributions of employers and employees 19% subsidy from general budget Scheme for the self-employed: Contribution: 22,8% - self-employed: 17,5%, budget: 5,3% 47% covered by contributions of self-employed 53% from general budget - 18% contribution, 35% subsidy

Self-employed artists Insured as „new self-employed“ if conditions are met Upon request a subsidy for the contributions (pension, health, accidents at work/occupational diseases) is granted A special fund for this purpose has been established € 1.350 maximum/year Maximum yearly income: € 22.440 Committees decide if somebody is artist in the meaning of these provisions If necessary the subsidiy must be repaid but only in the amount that exceeds the maximum yearly income

Redemption old Employed: Entitlement to payment when employment is terminated by the employer; amount depended on duration of employment 2 monthly salaries after 3 years up to 12 monthly salaries after 25 years Entitlement is lost when the employee terminates employement or is fired for „good reasons“ Self-employed: no system

Redemption new Employed (since 1.1.2003): Employers pay 1,53% of monthly salary into a fund Money is NOT lost no matter how the employment is terminated (paid contributions + interest - administration) Incentives (tax) to invest the redemption into old age insurance (third pillar) Self-employed (since 1.1.2008): Compulsory, 1,53% of contribution base, contributions to sickness insurance were reduced in the same percentage Incentives to invest the money into old age insurance