Hire employees
and contractors in Finland

Remote’s guide to employing in Finland.

Capital city
Helsinki
Currency
Euro (€, EUR)
Population size
5,536,146 (2020)
Languages spoken
Finnish, Swedish
01

Facts & stats

The Land of a Thousand Lakes (or, more accurately, 180,000 lakes), the Republic of Finland (Suomen tasavalta) is a parliamentary republic famous for its strong industrialized economy, pace-setting human development records, and a stable democracy.

Since 2018, Finland has been home to the world’s happiest people, driven by an extensive social welfare program, high per capita income, extensive civil liberties, and strong economic growth—all of which are factors that make Finland a great spot to expand your company’s reach to.

Finland Map
  • Capital city
    Helsinki
  • Currency
    Euro (EUR)
  • Languages spoken
    Finnish, Swedish
  • Population size
    5,536,146 (est. December 2020)
  • Ease of doing business
    Very Easy (2020)
  • Cost of living index
    77.46 (2021)
  • Payroll frequency
    Monthly
  • VAT – standard rate
    24%
  • GDP - real growth rate
    1.1 (2019)
02

Grow your team in Finland with Remote

To employ in Finland, you must either own a local legal entity in the country or work with a global employment solution. The challenge of managing payroll, benefits, taxes, and compliance in Finland along with multiple other countries can get complicated, especially without established local relationships.

Remote can handle the difficult parts of hiring employees and contractors in Finland so you can hire top local talent quickly, efficiently, and in full compliance with all relevant legislation. We take on the responsibility and legal risks of international employment so you can focus on hiring great talent and growing your business.

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Finland risks illustration

Risks of misclassification

Like many other countries, Finland treats self-employed individuals or contractors and full-time workers differently and there are risks associated with misclassification.
03

Employing in Finland

Finnish labor regulations are spelled out across several government statutes such as:

  • The Labour Safety Act (1958)
  • Annual Holidays Act (1973)
  • The Hours of Work Act (1996)
  • The Study Leave Act (1979), and,
  • The Act on Equality Between Men and Women

Put together, these statutes define provisions for employee protections and workers’ rights applicable to Finland’s workforce of 2.5 million. Employees in Finland enjoy protections against discrimination based on age, religion, sexual orientation, gender expression, and race.

Common questions that could come up during the hiring process include the minimum wage, overtime rates, and guaranteed paid time off. Remote can help you offer a complete, competitive, and compliant benefits package to your employees in Finland.

Public holidays

Date Holiday Name Extra information
New Year’s Day
Epiphany
Good Friday
Second Easter Day
Vappu
Ascension Day
Midsummer Eve
Midsummer Day
All Saints’ Day Saturday between October 31 and November 6
Independence Day
Christmas Eve
Christmas Day
St. Stephen’s Day
Minimum
Wage

Given its high human development index, extensive workers protections, and high per capita income level, Finland doesn’t have a government-mandated minimum wage; rather, employers are mandated to pay whatever rate agreed upon via collective bargaining, under which most Finnish workers are covered.

Payroll
Cycle
For customers of Remote, all employee payments will be made in equal monthly instalments on or before the last working day of each calendar month, payable in arrears.
Onboarding
Time
We can help you get a new employee started in Finland fast. The minimum onboarding time we need is only 9 working days.

Our team ensures your employees are onboarded and paid as quickly as possible while keeping your business compliant with all local employment legislation. The minimum onboarding time begins after the employee submits all required information onto the Remote platform. The onboarding timeline is also dependent upon registration with local authorities.

For all non-nationals of the country of employment, the Right to Work assessment (if applicable) will add three extra days to the total time to onboard. There may be extra time required if we need to follow-up on the right to work assessment.

Please note, payroll cut-off dates can impact the actual first day of employment. Remote has a payroll cut-off date of the 10th of the month unless otherwise specified.

04

Competitive benefits package in Finland

Remote can help you provide a competitive and compliant benefits package for your employees in Finland. If you have questions or would like to offer a custom benefit, let us know and we can help.

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05

Taxes in Finland

Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Finland.

  • Employer

    • Corporate income tax rate: 20%
    • 16.95% - Pension insurance
    • 1.53% - Health insurance
    • 0.05% - Unemployment insurance (1.9% for whatever portion of the salary that exceeds €2,169,000)
    • Tentative accident insurance premium, depending on risk level taken at work
    • Group life insurance premium (if agreed in any collective bargain)
  • Employee

    • 7.15% - Pension insurance (8.65% charged if the employee is aged 53 - 62)
    • 0.68% - Health insurance (1.86% for salaries above €14,766)
    • 1.4% - Unemployment insurance
  • Personal income tax rates

    • 0% - Up to €18,600
    • 6% - 18,600 – 27,900
    • 17.25% - 27,900 – 45,900
    • 21.25% - 45,490 – 80,500
    • 31.25% - Over 80,500
06

Types of leave

Paid
time off

Employees are entitled to between 24 to 30 paid days off, depending on factors such as prior agreement and provisions made in the employment contract.

Public
holidays

Finnish labor law mandates that employees can take 11 paid public holidays off, and will be entitled to double pay if required to work on a holiday. Provisions around any holidays not covered by the law can be defined during a collective bargaining agreement, applicable to both parties.

Sick
leave

Employees are entitled to 9 workdays of sick leave annually, compensated at a rate equivalent to 100% of the employee’s salary—provided the employee has worked with the employer for at least an entire month. Employees who’ve worked with an employee for less than a month will earn 50% of their wages for any sick leave taken.

After the first ten days of an illness, employees can apply for up to 300 days of sick leave.

Maternity
leave

Expectant mothers are entitled to 105 workdays of unpaid maternity leave, starting anywhere from 30 – 50 days before delivery. Mothers can claim the benefit from Kela (the Finnish Social Insurance Institution). If the employer opts to continue paying a full or part salary during the maternity leave, Kela pays the allowance to the employer.

Paternity/Parental
leave

Fathers can take up to 54 workdays of unpaid paternity leave, starting when the mother’s maternity leave begins, either at a stretch or in batches, but not exceeding the newborn’s second birthday. Similarly, parents can claim the benefit from Kela. If the employer opts to continue paying a full or part salary during the paternity leave, Kela pays the allowance to the employer.

Education
leave

Employees who have worked with an employer for up to a year are entitled to two years of unpaid leave, stretching over five years and broken into installments as necessary.

Employees who have worked with an employer for at least three months but less than a year can take up to 5 days off for studies.

Other
leave

Hospitalization leave: Parents are entitled to 4 days of leave if any of their children fall ill; compensation for hospitalization leave is determined by collective bargaining.

07

Employment
termination

Termination process

Employee contracts can be terminated if a just cause is established, such as dishonesty, negligence, fraud, or any other work-related offenses. That aside, notice should be provided in advance – provided both parties agree to it.

Notice period

In Finland, termination notice periods depend on how long the employment relation has lasted.

  • 14 days: up to 1 year of employment
  • 1 month: 1 – 4 years
  • 2 months: 4 – 8 years
  • 4 months: 8 – 12 months
  • 6 months: More than 12 years

Severance pay

There’s no severance pay mandated by law, but employers must pay any outstanding vacation pay.

Probation periods

Probations can last up to six months and can be extended in place of any sick leave taken during the probation period.

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