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Changes in the Family Benefits Act

Changes that will take effect starting of 1 April 2022

On 1 April 2022, changes in the parental benefit system will enter into force. This will involve a number of changes designed to make life easier and smoother for families bringing up a new citizen of the world. These changes will affect families with a child born on or after 1 April 2022.

The following changes affecting parental benefit will enter into force on 1 April:

  • Parental benefit and additional parental benefit for fathers will become maternity benefit, parental benefit for fathers, and shared parental benefit.
  • Maternity leave will be transferred from the Health Insurance Fund to the Social Insurance Board (maternity leave will be renamed in Estonian from ‘sünnituspuhkus’ to ‘ema vanemapuhkus’, but the name will remain unchanged in English), for which the mother’s parental benefit shall be paid.
  • The parent can use the shared parental benefit according to their wishes by calendar days. The father can also use the father's parental benefit by calendar days.
  • Parents will be able to take up to 60 days of parental leave at the same time. At this time, both parents receive parental benefit.
  • Both parents are entitled to ten working days of parental leave per child until the child reaches the age of 14.
  • Aadoptive parents become entitled to adoptive parental benefit.

Whereas parents previously had to deal with both the Health Insurance Fund and the Social Insurance Board regarding the subject of benefits, as of 1 April the whole system of state benefits for children will be centralised within the Social Insurance Board (except for any benefits paid by local governments). Mothers will be affected the most, as maternity leave will change from temporary incapacity for work to simply a form of parental benefit. The new benefit will continue to be called maternity benefit in English (in Estonian, maternity benefit will be renamed from ‘sünnitushüvitis’ to ‘ema vanemahüvitis’).

Maternity benefit will last for up to 100 calendar days, 70 of which are before the expected date of birth of the child. A working mother who is subject to social tax contributions also has maternity leave for the purposes of health protection during this period, and this is also entered in the employment register. If social tax has not previously been paid for work performed by the mother, then she is entitled to only 30 days of parental benefit from the birth of the child.

Although it may initially appear that maternity benefit (in Estonian, maternity benefit will be renamed from ‘sünnitushüvitis’ to ‘ema vanemahüvitis’) is paid for less time, this is not accurate – 40 days will instead be moved under shared parental benefit. As such, not one day will be lost and families will have more flexibility when it comes to claiming parental benefit.

In turn, the father shall become entitled to parental benefit for fathers 30 days before the expected date of birth of the child, for a total of 30 days. This benefit can be withdrawn by the father on a daily basis until the child reaches the age of 3 or until the father starts to take shared parental benefit. The father is also not allowed to work while receiving parental benefit for fathers – the father is on paternity leave, which is recorded in the employment register.

After the end of the maternity benefit period, it is up to the mother and the father to decide which of them will continue to receive parental benefit. This benefit is called shared parental benefit. Shared parental benefit can be withdrawn within 475 days. This benefit may be interrupted and continued by calendar days. If the mother did not have an employment or service relationship subject to the payment of social tax prior to the birth of the child, and was therefore entitled to only 30 days of maternity leave, the duration of parental benefit to be divided is 515 days.

NB: If one of the parents is on parental leave after the child reaches 30 days of age, that parent is entitled to shared parental benefit.

In addition, parents can take shared parental benefit for 60 days at a time. The number of days taken at the same time is deducted from the total duration of the payment of parental benefit. For example, if the mother takes 475 days of parental benefit, but decides with the father that the father could also receive 60 days of shared parental benefit, the father would receive 60 days of parental benefit and the mother 415 days. The aim is to allow both parents to also take part in the child’s upbringing at home.

It is possible to interrupt and continue both the parental benefit for fathers and the shared parental benefit by calendar days. This means, for example, that a parent can receive parental benefit for half a month and work for the other half. Even so, please note that if parental benefit has been paid in one calendar month, the normal earnings limit applies when calculating the amount of parental benefit. If a parent wishes to earn income exceeding more than half of the earnings limit for a given year, he or she must suspend receiving parental benefit for the duration of the month in question in order to avoid a reduction in the amount of parental benefit.

A new type of parental benefit will be created for adoptive families – parental benefit for adoptive parents. This benefit is payable to a working adoptive parent who is on adoptive parent leave or to a foster parent who is entitled to receive the benefit for temporary incapacity for work under the Health Insurance Act. The adoptive or foster parent is entitled to receive parental benefit for 70 calendar days within a period of six months from the date of entry into force of the court judgment on adoption or the date of the conclusion of the foster parent contract.

When using parental benefit, remember that the state pays social tax on it, which is the basis for the health insurance offered by the health insurance fund, as well as for the pension qualifying period calculated in the future. Before transferring the shared parental benefit from one parent to the other, the family should discuss whether it makes sense in terms of health insurance and the pension qualifying period.

From 1 April, the system for taking child leave will also change. While each parent was previously entitled to a total of 3–6 days of leave per year, depending on the age of the children, the reform will entitle each parent separately and on a per-child basis – each parent will be entitled to a total of 10 days of parental leave per child (i.e. a total of 20 days) until the child reaches the age of 14 (in other words, leave will no longer be calculated on a per-year basis, but all days will be spread over the period until the child reaches the age of 14). The use of parental leave does not shorten the annual holiday period. The child leave benefit will be paid under similar principles to that of the parental benefit, depending on previous income. Child leave is awarded for each child separately, up to a maximum of 30 calendar days per year. The use of child leave does not shorten the annual holiday period. Child leave benefit will be paid under similar principles to that of parental benefit, depending on previous income. You can take child leave for each child separately, up to a maximum of 30 calendar days per year.

mother and child are playing in the snow

 

 

     

    FAQ ABOUT PARENTAL LEAVE AND PARENTAL BENEFITS

    General questions about the changes

    Where to go and what to do to get parental leave (e.g., maternity, paternity or child leave)?

    In order to harmonise the system of parental leave and parental benefits, all calculation and payment of parental leave and benefits will be centralised to the Social Insurance Board. To take any of the parental leaves, the employee must make the relevant request in the self-service portal of the Social Insurance Board.

    The employee can see the number of unused leave days in the self-service portal. Once the employee has applied for leave, the Social Insurance Board will automatically inform the employer thereof.

    What are maternity, paternity and parental leave, and what are mother’s parental benefits, father’s parental benefits, and shared parental benefits?

    As a result of the changes, child care leave will be renamed parental leave, pregnancy and maternity leave will be renamed maternity leave, and paternity leave will remain paternity leave.

    Henceforth, the maternity benefit should be treated as the mother’s parental benefit; the paternity leave benefit as the father’s parental benefit; and the parental benefit as the shared parental benefit. This means that the result of the changes will be a parental leave with an individual part for mothers (maternity leave), an individual part for fathers (paternity leave), and a part for both parents (shared parental leave).

    The following diagram illustrates the changes to the system:        

    When is it possible to take maternity leave? How does the moment of taking maternity leave affect the parental benefit?

    The length of maternity leave will be up to 100 calendar days. Although the mother’s parental benefit is paid for a shorter period (100 days) than the maternity benefit (140 days), the period of payment of the parental benefit is longer on account of that, so the parent is guaranteed the same period of care of the child, covered with a benefit, as before. Therefore, the period covered by the benefit after the birth of the child is not shortened. From the 140 calendar days of pregnancy and maternity leave under the old system, 40 calendar days will be moved under the new system to the period covered by shared parental benefit, during which parents will have more flexibility to combine work and family life.

    The length of maternity leave will depend on when the mother takes maternity leave. For example:

    • If the mother takes maternity leave 70 calendar days before the expected date of birth of the child, her maternity leave will be 100 calendar days.
    • If the mother takes maternity leave 40 calendar days before the expected date of birth of the child, her maternity leave will be 70 calendar days. The remaining 30 calendar days will be moved to the period of the shared parental benefit, which means that the period after the birth of the child will be covered by the benefit that much longer.
    • The rule remains that if the mother takes maternity leave less than 30 days before the expected date of birth, the period covered by parental benefit is reduced by the number of days by which the mother took maternity leave later than 30 days. Therefore, if a mother takes maternity leave 10 days before the expected date of birth of her child, her maternity leave will be 40 days, but her period of parental benefit will not be extended by 20 days after the birth of the child.

    Maternity leave should be taken 70 to 30 calendar days before the expected date of birth of the child. After the expected birth of the child, maternity leave lasts for a further 30 calendar days. The mother’s parental benefit will be paid in the same way as the parental benefit: monthly (not as an advance payment like the current maternity benefit), and the mother’s parental benefit will have the same minimum rate as the parental benefit (i.e., the minimum wage for the previous year).

    If the mother is not entitled to the benefit for temporary incapacity for work under the Health Insurance Act or, to put it simply, if the mother is not employed, she is entitled to the mother’s parental benefit from the birth of the child until the child is 30 days old.

    How is parental benefit affected if the mother and father of a child are on parental leave together for two months?

    Parents will be given the option of taking two months of maternity, paternity or parental leave together and receiving the parental benefit for this period at the same time, but the total period of payment of the parental benefit will be reduced proportionately by the number of days for which the parents received the parental benefit at the same time. Therefore, if a mother and a father with a previous employment relationship have a joint entitlement to the parental benefit for 605 calendar days, and they decide to receive 60 days of the parental benefit at the same time, they will receive the parental benefit for 545 days because they have received 60 days of the parental benefit at the same time.

    Child leave

    Over what period and for how many days can a parent take child leave? How is child leave affected by the number of children in the family?

    Both parents who are employed will be able to take 10 working days (20 working days total for both parents) of paid child leave for each child under 14 years of age until the child reaches the age of 14. So, for example, for three children under the age of 14, one parent can take 30 working days of child leave and similarly, the other parent can take 30 working days of child leave; for four children, the corresponding number of working days is 40, and so on. The more children under the age of 14 in a family, the more days of child leave a parent is entitled to.

    It is important to note that it is not possible to take 10 working days of child leave per child per year, but these days can be taken out until the child turns 14.

    In a situation where a parent has more than three children, it should be noted that no more than 30 calendar days of child leave can be taken per year. So, for example, if a parent has more than three children under the age of 14, they can take up to a maximum of 30 calendar days of child leave for three children in one calendar year.

    Parents can plan the child leave to coincide at the same time or take place at different times. Both parents have individual child leave days to use, and the time they schedule or use these does not depend on when the other parent did so or does so.

    It is also important to know that single parents, i.e., if one of the parents is deceased or if there is no entry in the population register for the father of the child, have the right to use the child leave for up to 20 working days until the child reaches the age of 14; in other words, also use the child leave days to which the other parent would have been entitled.

    At what point or from what age of the child can child leave be taken?

    Under the new system, a person who is being paid parental benefits under the Family Benefits Act is not entitled to the child leave benefit. This means that child leave can be planned from the end of the parental leave.

    However, a situation where one parent is on parental leave and the other parent still wants to plan their child leave to coincide at the same time, is not excluded – for example, the mother is on parental leave and receives the parental benefit, but the father is at work and wants to plan the child leave. In such an example, the law does not prevent the father from scheduling child leave days before the end of the parental leave taken by the mother.

    Can child leave also be taken when the child is 14 years old?

    Yes, child leave can also be taken for a child in the calendar year in which the child turns 14. For example, if the child turns 14 on 1 August 2022, a parent can take child leave in the same year both before the child’s birthday and after the child turns 14, until 31 December of the same year.

    The same principle continues to apply to child leave for a disabled child. In the case of child leave for a parent of a disabled child, the parent is entitled to a total of 12 days of child leave in the year in which the child reaches the age of 18.

    How long do I have to notify my employer in advance of the wish for child leave? Do I have to submit the child leave application to my employer, to the Social Insurance Board, or to both?

    If child leave is not included in the leave schedule but the employee wishes to use it for 15 calendar days or less in a row, the employee must give at least a 14 calendar days’ notice of the use of leave not included in the leave schedule. If a parent wishes to take more than 15 consecutive calendar days of unscheduled child leave, the employee must give at least a 30 calendar days’ notice. The employee and the employer can agree that the employee can give shorter notice of the use of child leave.

    Days of leave can be planned in the self-service portal of the Social Insurance Board. Only those who do not have the possibility to plan the leave in the self-service portal (for example, spouse of a parent, if the biological parent has given up child leave days in favour of the spouse of the parent) need to separately indicate their wish to plan the leave.

    As the employee applies for child leave through the Social Insurance Board, the employee does not have to inform the employer separately. The Social Insurance Board automatically informs the employer of the employee’s request for leave. It is important that the employee schedules the leave days in the self-service portal in accordance with the above notice periods. An employee can submit a request for child leave in the Social Insurance Board’s information system up to two months before the leave is due to be taken.

    Does the employer have to keep a record of how many days of child leave the employee has already used and how many days they are still entitled to use?

    The employer does not have to keep such records. As the employee will henceforth plan their child leave through the Social Insurance Board’s self-service portal, the Social Insurance Board will have an overview of whether and how many days of child leave the employee is entitled to take. In the case of applying for leave via the self-service portal of the Social Insurance Board, the main purpose of the changes has been to automate the information system as much as possible and to provide the Social Insurance Board with the necessary data to decide on the granting of child leave. This will allow the employee and employer to worry minimally about, for example, how to prove the entitlement for child leave or how much child leave the employee has left.

    What must an employer do when child leave is requested? Can an employer refuse to grant child leave to an employee?

    If the employee plans child leave through the Social Insurance Board, the employer will automatically be notified. If the employer agrees to the application to plan child leave, it does not have to do anything (e.g., it does not have to send a separate confirmation to the Social Insurance Board). If the employer has grounds for refusing to grant the leave, the employer notifies the Social Insurance Board thereof within five days, and the Social Insurance Board informs the employee of the refusal to grant the leave. If the employer does not notify the Social Insurance Board about refusal within five days of receipt of the notification of the request for leave, the employee’s leave is automatically confirmed.

    In practice, there may be situations where child leave is included in the leave schedule and the employee submits a request for child leave at a different time from the one agreed upon, or where the employee does not comply with the notice period when submitting a request for child leave. The Social Insurance Board does not check or have an overview of the agreement between the parties on leave schedules or whether the parties have agreed on a more favourable notice period for the employee (for example, an agreement that the employee can request leave with a notice of less than 14 calendar days).

    The refusal of the employer to grant the leave does not prevent the employee from requesting it again (subject to the aforementioned notice periods).

    How will the child leave benefit be calculated under the new system?

    Whereas previously, the child leave benefit was linked to the minimum wage, it will now be linked to the parental benefit. Under the new rules, the amount of the child leave benefit will be 50% of the average of the 12 months’ income subject to social tax, calculated from three calendar months preceding the day of taking child leave (i.e., three months will be counted back from taking the leave, and the 12 months preceding that period will be taken into account for the calculation of the benefit).

    For example, if a parent wants to take child leave in June 2022, their child leave benefit will be calculated on the basis of their income subject to social tax for the period 1 March 2021 to 28 February 2022. Should the parent have other employers or other personal income subject to social tax, then this will be taken into account when calculating the benefit. Also, if the parent should have been on leave for temporary incapacity for work during this period, for example, then this period will be deducted from the calculation period so that the benefit would not be reduced by this period.

    In order to ensure that the child leave benefit is not reduced for employees whose income subject to social tax was below the minimum wage set by the Government of the Republic in the period for which the parental benefit is calculated, an additional limitation is set regarding the benefit. In particular, the benefit cannot be less than the amount of the parental benefit per calendar day calculated on the basis of the minimum wage.

    How many days of child leave will a parent be entitled to after the changes of 1 April? If child leave is used before 1 April, will this affect the leave days to which a person is entitled from April?

    From 1 April, all parents are entitled to 10 working days of child leave until the child reaches the age of 14, regardless of when the child was born or how many days of child leave the parent has taken in the past.

    Parents are entitled to use the 3 or 6 days of child leave provided for under the old law until 31 March. The number of days of child leave taken before the April changes come into force will not reduce or change the number of days of child leave granted under the law that will come into force on 1 April. If an employee uses up their child leave in the first three months of 2022, a new entitlement to 10 working days of child leave per parent will apply from April.

    Switching to the new system

    How will child leave be calculated in 2022 for a parent of a disabled child? But what about the calculation of the benefit?

    As before, the mother or father of a disabled child is entitled to one working day per month of child leave until the child reaches the age of 18 (including the year in which the child reaches the age of 18). Before 1 April 2022, 3 working days of leave can be used, and from the entry into force of the April amendments, the remaining 9 working days. Therefore, the number of days of planned leave days will remain the same and nothing will change in this respect. The days of leave will continue to be shared between parents, which means that it is up to them to agree who will take the leave and when.

    When planning and calculating the child leave benefit for a parent of a disabled child, we will look in 2022 at when these leave days have been used. If the employee uses them before 1 April, they will still do so through the employer, and the leave benefit will also be calculated on the basis of the old wording (calculated on the basis of the average of the last six months’ pay). If the employee uses these days after 1 April, the new wording will automatically be used for calculating the benefit. Therefore, from April onwards, a recalculation will be made in the calculation of the leave benefit, and from then until the end of the calendar year, the parent will receive the benefit under the new system.

    What is the system for calculating pregnancy and maternity leave or parental leave and its benefits if the entitlement for pregnancy and maternity leave arises before or immediately after the entry into force of the 1 April changes?

    If entitlement to pregnancy and maternity leave and maternity benefit arises before 1 April 2022, the maternity benefit will be paid on the basis of the previous regulation. The entitlement for pregnancy and maternity leave arises 70 days before the expected date of birth of the child. Therefore, if the expected due date of the child is on or before 9 June (and the mother has therefore become entitled to pregnancy and maternity leave before 1 April), the old pregnancy and maternity leave rules apply to the mother, and she will receive 140 days of the maternity benefit based on the previous calendar year’s income subject to social tax. After the end of the maternity leave, the entitlement to a shared parental benefit will be 435 calendar days. Parental benefit is paid on the basis of the 12 months before pregnancy (i.e., the nine months before). The parental benefit calculator can be found here: https://www.kalkulaator.ee/et/vanemahuvitise-kalkulaator.

    If the child’s expected date of birth is on 10 June or after that, the new rules will apply and the mother can apply for maternity leave 70 calendar days before the expected date of birth of the child. Maternity leave entitlement is 100 calendar days, and is remunerated at the rate of the mother’s parental benefit. The mother’s parental benefit is calculated on the same basis as parental benefit (on the basis of income subject to social tax for the 12 months before pregnancy).

    • Example 1: The mother’s entitlement for pregnancy and maternity leave started on 8 March 2022, and she took pregnancy and maternity leave on the same day (70 days before the expected date of birth of her child). Her certificate for maternity leave will run until 26 July of the same year. After that, parents will be entitled to 435 days of shared parental benefit and will be subject to all the conditions of the new rules.
    • Example 2: The mother in the previous example will go on pregnancy and maternity leave on 17 April (30 days before the expected date of birth of the child). In such a case, the mother is not entitled to the mother’s parental benefit because her right to pregnancy and maternity leave and maternity benefit started before 1 April. In the example shown, the mother’s certificate for maternity leave runs until 4 September. After that, parents will be entitled to 435 days of shared parental benefit and will be subject to all the conditions of the new rules.
    • Example 3: The mother is not entitled to pregnancy and maternity leave and the baby is born in mid-April 2022. In this case, the mother will receive 30 days of the mother’s parental benefit from the birth of the child, after which both parents will be entitled to 515 days of shared parental benefit. In addition, the father of the child is entitled to 30 days of paternity leave and/or the father’s parental benefit.
     

    Child care allowance will no longer be granted as of 1 September 2019

    • In connection with children born on 01.09.2019 and later child care allowance will no longer be paid. The state will gradually incorporate the funds that become available as a result thereof in the parental benefits system during 2020–2022. Read more about the planned changes on the website of the Ministry of Social Affairs (in Estonian).
    • We will grant and keep paying child care allowance pursuant to the old procedure to all families where a child is born on 31 August 2019 at the latest.
    • We will also keep paying child care allowance to all who are already being paid child care allowance on 31 August 2019 or to whom we have granted the allowance earlier. 
      We will keep paying child care allowance until the expiry of the right to the allowance or until 31 August 2024 at the latest.

    Additional info

    The amount of child care allowance is 38.36 euros per month from the time the payment of parental benefit is stopped until the child attains 3 years of age. If there are other children 3–8 years of age in the family, we will also pay child care allowance for them 19.18 euros a month per child. Families with 3 and more children have the right to child care allowance (19.18 euros) for all children up to 8 years of age. 

    Please note that parental benefit and child care allowance are not paid to a family at the same time – so during the time we pay the family parental benefit for one child we suspend the payment of child care allowance for all children in the family.

    Read more about child care allowance here.