UNEMPLOYMENT TRAPS FOR PEOPLE WITH DISABILITIES OR LONG-TERM HEALTH PROBLEMS Author(s): Kristel Bogaerts, Diana De Graeve, Ive Marx and Pieter Vandenbroucke
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Abstract
This paper sums up the conclusions of a research project detailing the obstacles and employment traps encountered by people with an occupational disability at various steps towards the labour market. Tax benefit simulations were used to calculate the disposable income of typical households, both on benefits and with paid jobs, after deduction of day care costs and taxes. This resulted in the added or reduced income from work after a situation of dependence on benefits. For all calculations, the study examined the effects on the income received from a low-paid or minimum wage job and in that context, it made several assumptions with respect to the level of social benefits, i.e. minimum/maximum level, and the labour regime, i.e. full-time or part-time. Five different benefit schemes were involved in the simulations: primary incapacity for work; disability; disability allowances, including both income replacing grants and integration allowances, and unemployment and income support. The study also made an inventory of the limitations and obstacles posed by legislation and social benefits practices. In general, the 2009 results showed no lower financial yield after resumption of work following dependence on benefits, provided that the work could be resumed at a wage level equivalent to that on which the benefit was based. Full-time resumption of low-paid work after maximum sickness and disability benefits did show a loss of income. For other types of situations, such as small part-time jobs at one third of a full-time job and single parent status, the additional yield from work or work resumption is only marginal. In practice, the rule of accumulation pertaining to the system of permitted labour under the sickness and disability benefits, is applied to half-time jobs only. This rule results in an income drop after the permitted activity followed by full-time employment. The net disposable household income for full-time work is only slightly affected by the welfare benefits enjoyed before resuming work. However, due to the rules of accumulation of welfare benefits and labour income, for part-time employment the level of the net disposable income depends on the benefits enjoyed before the employment or resumption of employment. The system and the level of the benefits are the determinant factors in this respect. In addition to these conclusions based on income simulations, interviews with field experts also showed a number of bottlenecks with respect to legislation and daily practices. There is a lack of synchronisation between the different systems of benefits and allowances. First of all, various income concepts are being applied haphazardly in the assessment of certain rights, making it difficult to estimate the financial consequences of employment, both for the individuals involved and for the counselling services. Secondly, the individual social benefit systems apply different rules for exemption of income. In the case of work resumption, part-time and otherwise, this can range from a fixed exemption of the professional income regardless of that income and the hours of employment, to a system that does include the hours of employment, or one that applies a variable exemption in accordance with the level of the professional income (in income brackets). In the third place, the incapacity and disability benefit scheme shows limited flexibility in terms of working hours under permitted labour. In practice one often has to make the step from half-time employment including social benefits, to full-time employment without benefits. The tax benefit simulations further indicate that this also involves a financial setback. In the fourth place, the allocation of tasks and responsibilities is less than optimal. Medical advisers assess the individual's fitness for the labour market against a medical background. At the same time, the Flemish Service for Employment and Vocational Training (VDAB) has the task to provide guidance and support to everyone who registers as a jobseeker. Meanwhile, communication on the issue of activation or reactivation between VDAB, the National Institute for Sickness and Invalidity Insurance (RIZIV) and the advising physicians is practically non-existent. And finally, access to the activation systems and employment supporting measures depends on an individual’s current or past social benefits or status. Some measures require a low educational level; other situations apply the current functional level. Furthermore, access to sickness and disability insurance is highly binary: one is declared either disabled or healthy; there is nothing in between. As a result, not all individuals with an occupational disability can profit from additional advantages.
Key words: Occupationally disabled, disadvantaged groups, labour market, activation
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