Unemployment

The Faroese unemployment scheme, Arbeiðsloysisskipanin (ALS), is funded by employers and employees in the Faroe Islands.

ALS provides unemployment benefits to employees who are dismissed and have the right to unemployment benefits. Unemployment benefits are based on the wages received over the last 12 months prior to becoming unemployed. Unemployed persons must be available for any kind of work.

Nordic citizens may have the period during which they have contributed to an unemployment insurance in another Nordic country transferred to the Faroese Unemployment Fund. 

Non-Nordic citizens with a temporary work permit are not entitled to unemployment benefits from the Faroese Unemployment Fund.

Unemployment fund contribution

An unemployment fund contribution is automatically withheld by the tax system from all wages paid to registered residents in the Faroe Islands. The fee is currently set at 0.8 percent of the income. Foreign citizens with a temporary work permit can apply for exemption from paying this fee.

Foreign employees who are dismissed from their job and do not have the right to benefits from ALS, may be entitled to temporary public assistance from the Department of Social Services.

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