Hiring in Finland? You’re tapping into a highly educated, innovative workforce backed by strong labor protections and a balanced work culture. This guide covers everything you need to know, from employment laws and working customs to how an Employer of Record (EOR) can simplify the process.

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How to Hire Employees in Finland

Hiring in Finland is straightforward if you know your options. Whether you’re building a local presence or expanding remotely, there are three main ways to bring Finnish talent onto your team:

Setting Up a Local Entity

This route gives you full control but comes with paperwork, legal costs, and time. It’s best for companies planning long-term operations in Finland.

Working with an Employer of Record (EOR)

Want to hire without the hassle of setting up a company? An EOR handles payroll, contracts, compliance, and taxes, letting you onboard quickly while staying legally sound.

Hiring Independent Contractors

Ideal for short-term or project-based work. Just be cautious, as misclassifying a contractor as an employee can lead to penalties under Finnish labor laws.

The right path depends on your timeline, goals, and how hands-on you want to be. No matter which option you choose, knowing the local rules is key to hiring right in Finland.

Finland Employer of Record vs Legal Entity in Finland

When expanding into Finland, companies have the option of forming a legal corporation or using an EOR service provider. You should choose an option based on your company’s business objectives, resource availability, and desired level of control.

Creating a legal entity in Finland, such as a limited liability corporation (Osakeyhtiö, Oy), requires several steps. First, the firm must register with the Finnish Trade Register, which involves filing the Articles of Association. This contains essential details such as the company’s name, registered office, and business sector. Once this is completed, companies must register for taxation, which includes corporate tax, VAT, and employer contributions for the employees they hire. Legal entities give companies operational control, allowing them to manage people, make decisions, and execute business strategies on a local level. However, they have significant setup costs, administrative procedures, and lasting compliance responsibilities.

An EOR is an alternative for companies looking for a faster, easier way to enter the Finnish market. An EOR serves as the legal employer, handling all local HR and legal compliance on behalf of the company. This includes managing employment contracts, payroll, tax compliance, and benefits that comply with Finnish labor legislation. The EOR performs various compliance and administrative responsibilities, allowing the company to focus on its main business activities without dealing with the difficulties of forming a full legal entity. While this option simplifies entry and reduces compliance risks, it limits a company’s control over its local operations. However, since the EOR is the formal employer, there may be limitations on how the company handles day-to-day employee relations or enforces certain rules.

Ready to get started with a Finland EOR?

Let us handle the hiring, compliance, and payroll complexities in Finland while you focus on growing your team.

  • Hire employees in Finland with a Finland EOR
  • No local entity is needed
  • Pricing starts at USD 199 per employee
  • Remote People can also help you find the best talent in Finland

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Using an Employer of Record in Finland

An EOR acts as the official employer on paper, handling everything behind the scenes: contracts, payroll, taxes, benefits, and compliance with Finland’s labor laws. Meanwhile, you stay in charge of the day-to-day work, like managing tasks, performance, and team culture.

It’s a clean, low-risk way to expand into Finland without needing to register a business, hire a local legal team, or navigate endless red tape.

Finland Employer of Record

An EOR is especially useful if you:

  • Need to hire employees quickly without setting up a Finnish legal entity
  • Want to test the Finnish market before committing long-term
  • Have one or two team members based in Finland
  • Need help navigating Finnish employment contracts, benefits, and tax rules
  • Want to ensure full compliance with local labor laws without becoming an expert yourself

Whether you’re onboarding one person or building out a whole function, an EOR makes it fast, flexible, and fully compliant.

KEY CONSIDERATIONS

  • Finland stands out globally for its commitment to lifelong learning. The country consistently ranks among the top for adult education participation, reflecting a culture that values continuous skill-building. Finnish professionals are especially strong in information processing and problem-solving, making them well-equipped for modern, tech-driven roles.
  • It’s no surprise Finland is often ranked the happiest country on Earth. With generous social support systems, strong civil freedoms, and a high standard of living, employees in Finland enjoy a work-life balance that’s hard to match. For employers, this means happier, healthier, and more engaged team members.
  • There’s a deep respect for innovation woven into Finnish culture. From embracing science and technology to investing in knowledge-based industries, Finland fosters a future-focused mindset. Add to that a workforce known for reliability and strong work ethic, and you’ve got a recipe for success, especially when building a remote team.

How Much Does an Employer of Record Cost in Finland?

The cost of using an Employer of Record in Finland depends on the services needed, the number of employees to be managed, the scope of activities, and the time frame of the partnership. EOR providers in Finland often charge either a flat monthly fee (varying from €600 to €2500) or a percentage of each employee’s monthly income (generally between 12% and 20%). Onboarding fees are also common, however they might vary. To obtain an accurate estimate, request a customized quote directly from the EOR provider.

Employment and Labor Laws in Finland

If you’re planning to hire in Finland, understanding the local labor laws is essential. From contracts and onboarding to working hours and overtime, Finnish employment regulations are designed to protect workers while keeping business practices clear and fair. Staying compliant means smoother operations, fewer surprises, and happier employees.

Employment Contract Requirements

In Finland, employment contracts can be verbal, electronic, or written, but written agreements are highly recommended. A clear, documented contract helps both employer and employee understand their rights and responsibilities from day one.

Here’s what every solid Finnish employment contract should include:

  • Names and details of both the employer and employee
  • Start date and, if applicable, the end date for fixed-term roles
  • Work location(s)
  • Job title and key responsibilities
  • Salary and benefits
  • Standard working hours
  • Vacation and leave entitlements
  • Notice period for termination
  • Length of probation, if applicable
  • Relevant collective bargaining agreements
  • Terms for any international assignments

Onboarding Process

Hiring in Finland can move quickly if you’ve got the right setup. Once all the required documents are submitted and any necessary local registrations are complete, employees can often be onboarded in just 1–2 business days.

For international hires, a Right to Work check may add a few more days, especially if follow-up documents are needed.

Be aware: payroll cut-off dates, like the 10th of each month, can influence official start dates, so timing is key.

Working Hours

A standard full-time workweek in Finland typically ranges from 37.5 to 40 hours, depending on the role and any applicable collective agreements. Flexible schedules are becoming more common, but employers must still follow national working time rules.

Overtime

Overtime is allowed, but only with the employee’s consent each time it’s required. Weekly working hours should not exceed 48 hours, including any overtime.

Here’s how overtime pay breaks down:

Overtime ConditionPay Rate
First 2 overtime hours in a day150% of regular pay
Additional overtime hours on the same day200% of regular pay

Fairness and transparency are key, both in asking for extra hours and compensating for them.

Probation Period

Probationary periods are common in Finnish employment contracts, giving both parties time to assess fit. These trial periods can last up to six months, but not longer. During this time, either side can end the contract with a shorter notice period, making it a safe way to ease into a working relationship.

Learn more about probation period in Finland

How an Employer of Record Helps You Hire in Finland

Expanding into Finland is an exciting move, but let’s be real… the legal landscape can be tricky. From labor laws to payroll rules, one wrong step can lead to fines, misclassification issues, or a full-blown compliance mess.

That’s where an Employer of Record (EOR) becomes your safety net.

An EOR acts as the official employer on paper, taking over the heavy lifting – things like employment contracts, tax filings, local benefits, and legal compliance – so you don’t have to. You still run the show when it comes to managing your people and driving results, but the EOR handles the bureaucracy behind the scenes.

It’s a smart, low-risk way to hire in Finland without setting up a local entity or learning the ins and outs of Finnish labor code overnight. Whether you’re hiring one remote employee or assembling an entire department, an EOR lets you scale on your terms, without the paperwork pile-up, legal guesswork, or stretching your internal resources too thin.

Payroll and Employment Taxes in Finland

Handling payroll in Finland means staying aligned with a few key norms. Some are official, while others are cultural. Here’s what you need to know to keep things smooth and compliant.

Fiscal Year

Finland’s fiscal year follows the calendar 1 January to 31 December. This 12-month period is used for financial reporting, payroll taxes, and year-end filings.

Payroll Cycle

Employees in Finland are typically paid once a month, with wages deposited by the last business day. Consistency is key here, as late payments can damage trust and even trigger penalties.

Minimum Wage

There’s no universal statutory minimum wage in Finland. However, don’t assume flexibility. Most workers are protected by sector-specific collective agreements that set minimum pay thresholds. It’s essential to review the relevant agreement for your industry before offering a salary.

Bonus Payments

While not legally required, it’s common practice in Finland to offer a 13th-month salary, especially around the holidays. Often paid just before an employee’s vacation, this bonus is seen as a goodwill gesture and an expected part of compensation in many sectors.

Employer Tax Contributions

Employer payroll contributions in Finland typically add approximately 20 – 22% on top of gross salary, depending on sector, job risk, and agreements.

Contribution TypeApproximate Rate
Pension Insurance (TyEL)~17.5% (varies by company size, industry, and employee status)
Health InsuranceUp to 1.53%, depending on annual payroll size
Unemployment Insurance0.52% (up to €2.3M in payroll), 2.06% beyond that
Accident InsuranceVaries by job risk and salary – average ~0.57%
Group Life InsuranceAs per collective agreement – typically around 0.06%

Employee Payroll Contributions

Contribution TypeRate
Pension Insurance7.15% (under 53 or over 62) / 8.65% (ages 53–62)
Health Insurance1.5%, including daily allowance and medical contribution
Unemployment Insurance1.5% flat rate

Total employee payroll deductions typically range from ~10.15% to 11.65% depending on age and income.

Individual Income Tax Contributions

Taxable Income (EUR)Tax Rate
€0 – €20,50012.64%
€20,501 – €30,50019%
€30,501 – €50,40030.25%
€50,401 – €88,20034%
€88,201 – €150,00042%
Over €150,00044%

In addition to national tax, employees also pay municipal tax (avg. 17%–20%), and possibly church tax (~1%–2%), depending on location and affiliation.

Pension System

Finland’s pension system is built on shared responsibility. Both employers and employees contribute to the Earnings-Related Pension Scheme (TyEL), which is mandatory for most employees. This insurance is arranged and paid by the employer but deducted partially from the employee’s salary.

The current retirement age in Finland is 65, though it may vary slightly depending on birth year and specific pension plans. Contributions made throughout an employee’s career go toward securing their income in retirement, as well as providing disability and survivors’ benefits if needed.

With TyEL in place, Finnish workers can count on a stable, predictable pension, making it an important part of both compliance and care when building a team in Finland.

How an EOR Helps You Run Payroll in Finland

In Finland, payroll isn’t just about cutting a check; it’s about accuracy, timeliness, and staying on the right side of tax and labor laws. Employees expect clarity and consistency, and any slip-ups can quickly erode trust.

That’s where an Employer of Record (EOR) becomes your payroll powerhouse. By managing every detail behind the scenes, an EOR ensures your team in Finland gets paid correctly, on time, and in full compliance with local regulations every single month.

Here’s how an EOR simplifies payroll in Finland:

  • On-Time, Local Payments: Salaries are processed promptly and delivered in euros, with no hiccups or currency issues.
  • Compliant Payslips & Reporting: Employees receive clear, legally compliant payslips and documentation that meet Finnish standards.
  • Accurate Tax Withholding & Contributions: From income tax to social security and pension payments, all mandatory deductions are calculated and submitted correctly.
  • Bonus & Benefit Integration: Any changes to compensation, such as holiday bonuses or benefit adjustments, are factored in automatically.
  • Peace of Mind for Everyone: Employees feel secure and you avoid compliance risks. Everyone wins.

With an EOR running your payroll in Finland, you can focus on growing your team without worrying about spreadsheets, tax codes, or missed deadlines.

Work Permits and Visas in Finland

If you’re hiring talent from outside the EU or EEA, you’ll need to navigate Finland’s work permit and visa process. Fortunately, Finland offers a well-structured, streamlined system, especially for skilled professionals.

Residence Permit for an Employed Person (TTOL)

For workers with a confirmed job offer in Finland. This permit is tied to a specific role and employer.

Specialist Permit

For highly skilled professionals, particularly in IT, engineering, and finance. Processing times are faster, usually around two weeks.

EU Blue Card

A residence permit for non-EU citizens with high qualifications and a job offer that meets salary thresholds.

Startup Permit

For non-EU entrepreneurs looking to build innovative businesses in Finland.

Seasonal Work Permits

For short-term jobs in agriculture, tourism, or similar industries.

What Employers Need to Do

You’ll need to issue a formal job offer, ensure salary meets legal thresholds, and submit required documents to the Finnish Immigration Service (Migri).

Processing time: 1–3 months, though some fast-track permits are quicker.

An Employer of Record can manage the entire process, from documentation to compliance, so your international hires can start without delays or headaches.

Time Off and Leave in Finland

In Finland, time off is encouraged and protected by law. The country places a strong emphasis on work-life balance, and employee leave policies reflect that cultural value.

Mandatory Leave Entitlements

Employees are entitled to a minimum of five weeks (25 days) of paid annual leave per year. Typically, vacation is earned over the course of one “accrual year” (April to March) and taken during the following summer months, especially July, which is a popular vacation period nationwide.

Public Holidays

Finland observes 13 public holidays, including Christmas, Easter, Midsummer, and Independence Day. If a public holiday falls on a weekday, employees usually get the day off with pay.

  • New Year’s Day (1 January)
  • Epiphany (6 January)
  • Good Friday (March/April, day varies)
  • Easter (March/April, day varies)
  • Easter Monday (March/April, day varies)
  • Vappu / May Day (1 May)
  • Ascension Day (April–June, Thursday, 40 days after Easter)
  • Midsummer Eve (June, day varies)
  • Midsummer Day (June, day varies)
  • All Saints Day (4 November)
  • Independence Day (6 December)
  • Christmas Day (25 December)
  • Boxing Day (26 December)

Sick Leave

Employees are entitled to sick pay from the first day of illness, typically covered by the employer for the first 10 days. After that, compensation shifts to the Finnish social security system (Kela), provided a doctor’s certificate is submitted.

Maternity Leave

In Finland, maternity leave – called pregnancy leave – lasts for 40 working days and typically begins 14 to 30 working days before the due date. During this time, the birthing parent receives a pregnancy allowance based on their income. After this period, they transition into parental leave, where each parent is entitled to 160 working days of paid leave, with the option to transfer up to 63 days to the other parent.

If the work environment poses health risks that can’t be adjusted, the employee may also qualify for special maternity leave. These policies highlight Finland’s strong support for families and commitment to work-life balance.

Parental Leave

Parental leave in Finland is generous and gender-neutral. Each parent is entitled to 160 working days of paid parental leave per child, totaling 320 days per family. Parents can choose to use their days flexibly until the child turns two, and may also transfer up to 63 days to the other parent.

For single parents, the full 320 days are available. The system is designed to support equal caregiving and work-life balance across all family structures.

Using an Employer of Record to Administer Benefits in Finland

In Finland, employee benefits are a legal obligation. Overlooking even one detail can lead to penalties and quickly damage your credibility as an employer. That’s why many international companies rely on an Employer of Record (EOR) to get it right from day one.

An EOR takes full responsibility for administering statutory benefits, including health insurance, pensions, paid leave, and more. They ensure everything is properly set up during onboarding, adjusted if an employee’s role or status changes, and kept fully compliant with Finnish regulations.

But it’s not just about ticking legal boxes. A well-run benefits program shows your team you care. An EOR also handles employee communication, so your team always knows what they’re entitled to and how to use it. No confusion. No gaps.

In short, with an EOR managing your benefits in Finland, you don’t just stay compliant; you give your employees a sense of security and support that strengthens trust and retention.

Terminations and Severance in Finland

Ending an employment relationship in Finland must be handled with care, fairness, and strict adherence to labor laws. Unlike some countries, Finland doesn’t support at-will termination; there must always be a valid reason.

Termination Process

Employers can only terminate an employee for just cause, such as serious misconduct, redundancy, or long-term underperformance. The reason must be clearly documented, and the employee has the right to respond before dismissal. In fixed-term contracts, employment ends automatically at the contract’s expiration, unless otherwise stated.

During the probationary period (up to 6 months), termination can occur more easily but must still follow proper procedures and notice requirements.

Notice Periods

Notice periods in Finland vary based on the length of employment and whether the termination is initiated by the employer or the employee:

Employee-initiated resignation

Length of EmploymentNotice Period
Less than 5 years14 days
5 years or more1 month

Employer-initiated termination

Length of EmploymentNotice Period
Less than 1 year14 days
1–4 years1 month
4–8 years2 months
8–12 years4 months
Over 12 years6 months

Severance Pay

There is no statutory severance pay in Finland. However, employees are entitled to full pay and benefits throughout the notice period. Additional severance may be negotiated in employment contracts or collective agreements.

Employers are also expected to assist with re-employment efforts in redundancy cases, especially for long-term employees.

Expand into Finland Easily with Remote People’s Employer of Record in Finland

Hiring in Finland opens the door to a highly educated, tech-savvy workforce and a work culture that values fairness, balance, and innovation. But navigating the legal landscape, payroll requirements, and employee benefits can be complex, especially if you’re new to the region.

That’s where an Employer of Record can make all the difference. With the right EOR partner, you can hire confidently, stay compliant, and offer a world-class employee experience, without setting up a local entity or getting buried in bureaucracy.

Whether you’re building a remote team or testing the Finnish market, we’re here to help you grow smarter. Let’s make your hiring journey in Finland seamless, compliant, and built to last.