European Disability Pension Policies by Christopher Prinz

Author:Christopher Prinz [Prinz, Christopher]
Language: eng
Format: epub
ISBN: 9781138726536
Barnesnoble:
Publisher: Taylor & Francis
Published: 2019-10-29T00:00:00+00:00

The distinction between disability and unemployment risks is difficult, be-cause the concept of disability in Germany also includes labour market criteria. But despite this fact, programmes other than disability pensions areused mainly to cope with labour market problems in Germany, particularly job-creation measures including subsidies (up to 100%) paid to the employer.

The calculation of unemployment benefits24 differs considerably from the calculation of pensions. The disability pension is based on the complete working career, whereas the unemployment benefits are based on the earned income within the previous 52 weeks. Unemployed persons are eligible for unemployment benefits, in most cases for one year (see Table 4 below). These benefits are not means-tested. After the claims are exhausted, unemployment relief starts. The unemployment relief is granted without time limit, but in contrast to unemployment benefits it is means-tested.

The unemployment benefits amount to 67% of the calculation basis if the unemployed person has children up to age 18. The basis is formed by standardized net earnings. Childless persons or those with adult children receive 60%. In case of an average earner the resulting replacement ratio is similar to that of disability pensions, but it varies owing to different assumptions with regard to the working career.

Table 4 shows the duration of the unemployment benefit as a function of age and length of service. Unemployment benefits as well as relief are limited until the respective person is entitled to an old-age pension, at maximum until age 65.

Table 4: Duration of unemployment benefits according to length of service and age

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