Your Guide to Hiring Employees and
Contractors in Finland
Ease of doing business
27.69% to 29.24%
All employee payments will be made in equal monthly installments on or before the last working day of each calendar month, payable in arrears.
Minimum Wage Requirements:
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.
Individual Income Tax
The individual national income tax ranges from 6% to 32%. Income tax is calculated according to progressive rates for national taxes. Employees also pay an additional flat rate for municipality taxes (up to 23%). Multiple additional factors may impact overall rates such as Church Tax, number of children, among others.
Up to EUR 27,900
Tax rate: 6%
Up to EUR 45,900
Tax rate: 17.25%
Up to EUR 80,500
Tax rate: 21.25%
Over EUR 80,500
Tax rate: 32%
The employer cost is generally estimated at 19% of the employee salary.
Monday to Friday.
Overtime Pay & Maximum Hours
Overtime must be mutually agreed on in the employment agreement (EA). If there is overtime in the EA, hours outside of standard work hours are paid according to the Working Hours Act.
For additional hours, the employer can pay employees:
150% of the hourly rate for the first 2 hours.
200% of the hourly rate for the following hours.
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.
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
Probations can last up to six months and can be extended in place of any sick leave taken during the probation period.