Employee Leasing in Finland
Finland offers outstanding opportunities for businesses wishing to expand their activity into Northern Europe, thanks to its very high political and economic stability, as well as the quality of its infrastructure and its labor force. The country’s world-renowned stability provides investors with great medium and long-term visibility, which significantly reduces investment risk.
One of the simplest ways to profit from the opportunities offered by the Finnish market is to expand business there through employee leasing. The employee leasing services offered by FMC Group help businesses enter the Finnish market at reduced costs and without having to establish a local subsidiary in Finland. Additionally, the support provided by FMC Group allows companies to quickly integrate into the Finnish market and focus on their growth strategy, without worrying about local regulations.
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- Advantages of Employee Leasing in Finland
- Employee Leasing Services Offered by FMC Group
- Advantages of the Finnish Market
- Recruitment in Finland
- Minimum Wage and Payroll
- Social Contributions and Taxes
- Working Hours and Overtime
- Vacation Days
- Parental Leave and Sick leave
- Notice Period
Advantages of Employee Leasing in Finland
- Employee leasing in Finland allows quick and easy access to one of the most thriving European domestic markets, as well as to the markets of Nordic countries and the European Union.
- Expanding business activity in Finland through employee leasing reduces investment risk, allowing for greater flexibility in the market entry and exit – if needed.
- Delegating the administrative management of employees to FMC Group through employee leasing lets businesses concentrate their efforts on business decisions and strategies that contribute directly to their growth.
Employee Leasing Services Offered by FMC Group
- Selecting candidates according to the client’s needs and requirements;
- Negotiating and signing employment contracts after the client’s approval;
- Providing accounting services that respect international standards;
- Paying social contributions and taxes according to Finnish regulations;
- Paying all types of expenses and allowances after the client’s approval;
- Monitoring paid leaves;
- Negotiating and implementing private health insurance if requested;
- Maintaining continuous and regular communication with the client regarding the management of their employees.
Management and Reporting Flow of Employee Leasing Services
Advantages of the Finnish Market
- Finland has an extremely stable business environment. The country is known for its high level of transparency and the effectiveness of its state institutions. Finland ranked as the best business environment in the world, according to the 2021 Global Innovation Index, and as the most stable country in the world – for the 16th year in a row – according to the 2022 Fragile States Index, published by American NGO Fund for Peace.
- The Finnish economy is highly industrialized, knowledge-based, and innovative. It is based on free trade and openness to investment. Finland is ranked as the third most innovative country in the world by the Consumer Technology Association, an American trade association representing the consumer technology industry.
- The labor force in Finland is known to be highly skilled and motivated, thanks to the quality of the Finnish education system, as well as the quality of life in Finland. Finnish workers ranked as the second most skilled workforce in the world in the World Economic Forum’s 2019 Global Competitiveness Report.
- Finland has some of the most reliable infrastructures in the world, notably in terms of ICT networks. The country has attracted major data center investments from companies like Google, TelecityGroup, and Yandex, thanks to its well-functioning infrastructure and highly skilled IT professionals.
- Sector-specific investment opportunities are regularly published on Business Finland.
Recruitment in Finland
Minimum Wage and Payroll
- There is no statutory minimum wage in Finland. However, most employees are covered by collective agreements that specify minimum pay rates.
- Salaries in Finland are paid monthly, usually on the last working day of each month.
- A 13th-month salary bonus is customary in Finland. It is usually paid before the employee’s annual paid leave.
Social Contributions and Taxes
|Employee Income Tax|
|Up to EUR 19,200 per year||0.00%|
|Between EUR 19,200 and EUR 28,700||6.00%|
|Between EUR 28,700 and EUR 47,300||17.25%|
|Between EUR 47,300 and EUR 82,900||21.25%|
|More than EUR 82,900||31.25%|
Working Hours and Overtime
- Finnish law defines the weekly limit of working hours at 40, with eight hours per day.
- Overtime work is paid at a rate of 150% of the regular salary for the first two hours and 200% for any subsequent hours.
- On weekends and public holidays, overtime work is paid at a rate of 200% of the regular salary.
- Overtime work cannot exceed 138 hours over a period of four months and 250 hours in one year.
- Employees in Finland are entitled to four weeks of paid annual leave per year during their first 15 years of service for the same employer. The duration increases to five weeks for employees who have been working for the same employer for over 15 years.
- Finland commemorates 11 public holidays:
- New Year’s Day: January 1st;
- Epiphany: January 6th;
- Good Friday: Between April and May (moveable);
- Easter Monday: Between April and May (moveable);
- Labor Day: May 1st;
- Ascension Day: Between May and June (moveable);
- Pentecost: Between May and June (moveable);
- Midsummer Holiday: Between June 19th and June 26th (two days);
- All Saint’s Day: November 1st;
- Independence Day: December 6th;
- Christmas Holiday: December 24th–26th.
Parental Leave and Sick Leave
- Pregnant employees in Finland are entitled to 105 days of maternity leave, including a mandatory four-week leave – two weeks before birth and two weeks after. Employees receive allowances from social security during maternity leave.
- New fathers can take 54 days of paternity leave. The first 18 days of the leave must be taken directly after the child’s birth, while the remaining 36 days can be taken until two years after birth.
- Employees in Finland are entitled to sick leave for as long as the doctor suggests. Pay during the first 10 days of sick leave is fully covered by the employer. After 10 days, social security covers 50% of the employee’s salary until they can return to work.
- Employees with less than five years of work for the same employer have to give a 14 days’ notice.
- Employees who have been working for the same employer for more than five years have to give a one-month notice.
Further Useful Information
- More information about labor laws in Finland is provided by the Finnish Social Security Institute (KELA).
Disclaimer: Although we carefully researched and compiled the above information, we do not give any guarantee with respect to the actuality, correctness, and completeness.