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Finland
Finland is a Nordic country in Northern Europe. Country has land borders with its Nordic neighbours Norway and Sweden. Finland also has a land border with Russia and sea borders with Estonia and Åland. Finland is a member of the EU and became a member of NATO on 4 April 2023.
POPULATION
5,637 million inhabitants
CURRENCY
Euro (EUR)
GDP
$299,84 billion
MINIMUM MONTHLY WAGE:
An average wage 4183 USD
TIME ZONE
UTC +2
Finland is famous for being the Happiest Country in the World, as well as having the world’s best education system and cleanest air.
Finland is known for its saunas, reindeer, Nokia, and the Santa Claus village.
This Nordic utopia is sometimes called the Country of a Thousand Lakes, and it’s got 187,888 of them.
- Permanent contract
- Fixed-term contract
- Internship
- Apprenticeship
Employment contracts are usually valid indefinitely. Contracts can be made fixed term on the initiative of the employer only for a justified reason. The grounds shall be indicated in the employment contract. Such grounds are:
- acting as a substitute
- seasonal work
- fixed-term project
- one-time work
- training period in an educational institute
- fixed term of a trainee contract
Trial period
The trial period must be explicitly agreed in the employment contract.
This trial period may not be longer than 6 months, and in the case of fixed-term contracts, the length of the trial period, including any extensions, cannot exceed half the length of the contract.
The employer can prolong a trial period if the employee has been incapacitated or on family leave for 30 calendar days or more during the trial period.
According to the Working hours act, regular working hours may not exceed 8 hours a day and 40 hours a week.
The main rule does not prevent employers from introducing arrangements that are based on shorter working hours than the maximums. Most common regular working hours in Finland are 7.5 hours a day and 37.5 hours a week.
Employees who work more than 6 hours a day must be given a daily break of at least 1 hour. The employer can also agree on a shorter break with their employees, but no shorter than half an hour.
As a rule, employees are entitled to an uninterrupted period of at least 11 hours off during the 24 hours following the beginning of each shift.
Finnish labor law fixes the maximum weekly working hours at 48 hours, including overtime, measured over a four-month reference period.
Overtime is compensated with a higher salary rate, which depends on the number of overtime hours and whether it’s daily or weekly overtime or overtime in the context of period-based work. Alternatively, employees can be compensated for overtime by receiving paid time off in lieu of the overtime hours worked.
Daily overtime is compensated for by increasing the pay by 50% for the first two hours of overtime and by 100% for the following hours (basic pay + increase).
A 50 % increase on the employee’s regular wage is payable for weekly overtime.
Finland’s labor code establishes 5 weeks or 30 days of paid annual leave.
The accrual of vacation days is calculated based on the holiday credit year from April 1 to March 31. If an employment relationship lasts for less than a year as of March 31, the employee is entitled to two vacation days for each full holiday credit month. If an employment relationship continues for a year up until March 31, the employee is entitled to two and a half vacation days for each full holiday credit month.
Employees in Finland are entitled to 13 public holidays per year.
Date Day Holiday
01-Jan Thursday New Year’s Day
06-Jan Tuesday Epiphany
3-Apr Friday Good Friday
6-Apr Mon Easter Monday
01-May Friday May Day
14-May Thursday Ascension Day
24-May Sunday Whit Sunday
19-Jun Friday Midsummer Day
20-Jun Saturday Midsummer Day
31-Oct Saturday All Saints’ Day
06-Dec Sunday Independence Day
24-Dec Thursday Christmas Eve
25-Dec Friday Christmas Day
26-Dec Saturday 2nd Day of Christmas
Pregnancy leave begins 30 working days before the baby’s due date. The employer and the employee may agree to postpone pregnancy leave so that it begins no later than 14 working days before the due date.
Parental allowance is paid on the basis of the birth and adoption of a child for a maximum of 320 working days. If a child has two parents, 160 working days are available for each. In addition to these days, the pregnant person still has 40 days of pregnancy allowance before transferring to parental allowance.
The employer and the employee may agree on an employee’s taking parental leave on a part-time basis and the terms of part-time work.
Employers must grant childcare leave until the child turns three, which may start after 160 days of childbirth.
If the employment relationship lasts for at least one month, employees are entitled to full pay as sick pay. In employment relationships that last for less than one month, employees are entitled to 50% of their pay as sick pay.
Employers are obligated to pay employees for 10 consecutive days of sick leave.
Employers are still required to provide employees with the necessary time off if they’re still sick after 10 days, they no longer have to pay for this benefit. Instead, employees will need to seek financial compensation through Finnish social security for any remaining missed workdays.
Mandatory employee benefits in Finland include:
- Employee’s compensation
- Statutory pension (TyEL)
- Unemployment insurance
- Occupational healthcare
- Life and Disability Insurance – many employers would provide this benefit as it tends to be one of the most cost-effective; there is no tax implication for the employee on the premiums, and it is of significant value as a protective measure should an employee pass away and leave their financial dependents encumbered by debt or significant loss of household income.
- Private medical insurance
- Dental insurance
- Supplemental pension
- Supplemental Accident insurance
- Group Travel – business travel insurance is almost seen as a must in sectors where the employees travel, and also occasional leisure travel is covered.
- Well-being and sports allowance
- Flexible working hours
- Mobile expenses
- Meal allowance
- Bonus
- Stock options
- Employee Referral Program Bonus
A Schengen visa is an entry permit for a short, temporary visit of less than 90 days in any 180-day period.
Citizens of an EU Member State, a Nordic country, Liechtenstein or Switzerland, do not need a residence permit to stay in Finland. The person must register the right of residence at the Finnish Immigration Service if planning to reside in Finland for a longer period than three months without interruption.
Non-EU/EFTA nationals need a long-stay visa and a residence permit to be allowed to stay in Finland.
The type of residence permit the person needs to apply for depends on what type of work he/she will do during the stay.
To work in a profession with an employer shortage, an individual needs to get an Finish EU Blue Card. To qualify for an EU Blue Card, the professional qualifications and the required work experience must be met.
An indefinitely valid employment contract is usually terminated by either the employer or employee giving notice to terminate.
The employee does not need to give any grounds for termination, but he/she is required to serve the period of notice.
The employer, on the other hand, may not terminate an employment relationship without proper and weighty reason.
An employment relationship can also be ended by mutual agreement between employee and employer concerning when, and on what terms.
Notice period
When an employee terminates the employment contract:
- 14 days when employed for up to 5 years
- maximum of 1 month when employed for over 5 years
When an employer terminates the employment contract:
- minimum 14 days for up to 1 year’s employment
- one month for 1 to 4 years of employment
- two months for 4 to 8 years of employment
- four months for 8 to 12 years of employment
- maximum 6 months for over 12 years of employment
Grounds for termination
The grounds for terminating an employment contract are divided into two categories:
- Individual grounds that relate to the employee (that is, the conduct and performance of an individual employee).
- Collective grounds that relate to financial and production-related reasons or to the company’s restructuring.
Personal circumstances that cannot be used as grounds for termination include:
- illness, disability, or injury, except in cases where those substantially reduce the employee’s ability to work for.
extended periods, and the employer cannot reasonably be expected to continue the employment agreement.
- participation in industrial action covered in the Finnish Collective Agreements Act or on their trade union’s orders.
- political, religious, or other views, as well as participating in social activism or associations
- exercising legal remedies.
There is no statutory obligation to pay severance.
Employees dismissed from their jobs may receive basic unemployment allowance from KELA or earnings-related unemployment allowance from an unemployment fund.
Over the past decade, Finland’s labour market has been characterized by high participation and employment rates in comparison with other OECD countries and a relatively stronger recovery in employment and participation after the COVID‑19 pandemic. Unemployment has also continued to recover, standing at 6.9% in 2023.
With our immigration support solution, we can ensure 100% compliance with the local legislation in terms of expatriates ‘s employment in Finland within a short period of time, in order to facilitate and speed up expansion of your business to the country.
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