Client Alert On Unemployment Insurance In Azerbaijan

On 30 June 2017, the President signed a new Law on Unemployment Insurance, followed on 5 August 2017 by a Presidential Decree on the application of the new Law.

We summarize below the major aspects of the new Law on Unemployment Insurance.

The Purpose and Scope of the Law

The Law on Unemployment Insurance is intended to ensure the strengthening of the social protection of the population through the establishment of relations based on transferring risk and on new financing mechanisms in the labor market of Azerbaijan, taking preventive measures to compensate for the lost salaries of insured persons and to reduce unemployment.

The Law provides for unemployment benefits payable to employees who are unemployed due to the liquidation of a state body or legal entity or due to a staff reduction, where such employees have paid into the state insurance system (prior to the effective date of the law, those who have paid into the State Social Protection Fund