Just a few short years ago, companies worldwide found themselves abruptly adopting work-from-home and hybrid employment models due to the COVID-19 pandemic. Despite reservations about the practicality of such arrangements, employers have since realized that remote employment doesn’t just work—it opens up exciting opportunities for talent acquisition and expansion into new markets backed by local knowledge. Instead of limiting recruitment to domestic candidates, businesses can now focus on simply finding the best candidate, no matter where they are.
As businesses tap into markets throughout the European Union (EU), some are setting their sights on Finland as an ideal place to establish a presence. As a member of the EU since the 1990s, Finland offers greater access to European markets while remaining relatively business-friendly, especially compared to other member states. Hiring in Finland offers employers access to a pool of highly skilled and educated professionals. However, navigating the international hiring process comes with its own set of challenges.
When expanding globally, businesses frequently rely on an employer of record (EOR) to handle intricate tasks such as compliance, payroll, and adherence to local customs and hiring regulations. If you're contemplating hiring talent from Finland, understanding EOR services and employment laws in the country is essential.
What is an employer of record?
Each country, region, and even municipality can have different laws and regulations governing employment, rights, and compliance, and these nuances are more than most companies are equipped to navigate. This is where employers of record come in. An EOR is a third-party entity that can function as the legal employer of a workforce on behalf of another party.
By partnering with an EOR, businesses gain access to a skilled pool of talent without the hassle of establishing a legal entity in unfamiliar territory. This approach not only saves time and resources, but also eliminates the stress of compliance and legal complexities. Using an EOR requires fewer resources compared to alternative options like opening a subsidiary, making it an attractive solution for smaller ventures with limited capital and legal expertise. With an EOR, you can confidently expand your global reach and focus on what you do best—growing your business.
What are the benefits of using an EOR?
If a business chooses to hire international employees directly, without utilizing an employer of record or a similar service, it must undergo several steps. Firstly, it needs to establish itself as a legal entity in the target country or countries, open local bank accounts, and assemble a legal team for each area. This last step is particularly crucial and intricate. Employers must ensure compliance with all local employment laws, covering aspects such as benefits, payroll, taxes, intellectual property, and more.
Embarking on this journey from scratch and expanding into a new territory can be a lengthy and resource-intensive process, spanning months or even years. It requires a significant financial investment and a dedicated commitment to navigating the complexities of international expansion.
An employer of record eliminates the need for all the complex legwork by serving as the legal employer and assuming responsibility for all the aforementioned considerations. These entities are specifically designed to expedite the hiring process, simplify legal requirements, and streamline payroll procedures. Using an EOR in Finland for these processes also ensures your compliance and reduces the risks of hiring abroad.
Employment law in Finland
Labor law is a complex topic, and every country has its own set of guidelines and requirements. In order to stay compliant and position yourself as a competitive employer, it’s crucial to stay up to date and informed on local labor laws, customs, holidays, and employment expectations. Here are a few things to keep in mind as you consider hiring talent in Finland.
Finnish demographics
Finland has a population of just under 6 million people, the majority of whom speak Finnish natively and consider themselves ethnically Finnish. However, Swedish is spoken natively by a sizable portion of the country and is also a recognized national language. The Sami people are an indigenous group native to the northern parts of Finland and the surrounding areas, and the Sami language is widely spoken among this population.
English is widely taught in schools and 70% of Finns can speak English. The country has one of the best education systems in the world, leading to many qualified candidates in fields ranging from art and design to technology and development.
Payment requirements and expectations
In Finland, there is no statutory minimum when it comes to an employee’s wages, but the vast majority of employees in the country are represented by a trade union, and most contracts are subject to collective bargaining. Employees in Finland are also protected by several pieces of legislation, including the Employment Contracts Act, Non-Discrimination Act, Working Time Act, and the National Holidays Act.
The typical workweek is eight hours a day and 40 hours per week, though it’s common for white-collar work to have shorter days. Overtime is billed at 50% above base pay for the first two hours of overtime worked in a day and twice the regular rate thereafter. Any employee working on a public holiday is entitled to double pay for their time. Payroll occurs monthly, and many employees are granted 13th and 14th month pay, though this is not strictly required.
To learn more, check out our complete guide to hiring employees in Finland and use Oyster’s cost calculator for a full breakdown of the cost of hiring in Finland.
Leave and termination
Finland recognizes just over a dozen public holidays each year. Employees accrue an additional two days of personal leave per month worked during their first year of employment and two and a half days per month in subsequent years. As for sick leave, employees are entitled to 10 sick days per year at full pay, after which sick leave is covered by the Finnish National Pension Institute at a rate of 70% of normal pay. Maternity leave may last for up to 105 weekdays, while paternity leave may last for up to 54 days.
In most cases, an employer must provide notice of termination well in advance of the employee’s final date of employment. For employees who’ve been with the company for less than a year, this notice period is 14 days. Employees with longer tenure are entitled to longer notice periods up to a maximum of six months after 12 years of employment. Probationary periods of up to six months are allowed, during which time either the employer or the employee may terminate the contract at will and without notice or just cause.
How Oyster can help you hire in Finland
Oyster is a global employment platform that operates worldwide to help businesses hire the best person for the job, no matter what the role, where the company is based, or where the employee is located. We enable companies to compliantly employ full-time and contractor talent in over 180 countries and pay teams in over 140 currencies.
Oyster functions as the legal employer for our customers’ international hires, and in countries where we haven’t already established an entity, we work with trusted EORs to ensure an easy and reliable hiring process. We take care of contracts, compliance, payroll, benefits, and more—so you can focus on your team.
Learn more about how Oyster can help you hire internationally and build a global workforce.
About Oyster
Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.
Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.
