Overview
Payroll Cycle
Employer Contributions
Employee Contributions
Minimum Wage
Hiring
Hiring Employees
Hiring Contractors
Hiring Expats
Background Checks
Employment Contracts
Onboarding
Employee Benefits
Social Security
Healthcare and Insurance
Leave Policy
Public Holidays
Work Permit and Work Visa
Probation Period
Notice Period
Termination and Severance
Personal Income Tax
Are you considering expanding your business to Estonia? Navigating the intricacies of local employment laws and establishing a workforce in a foreign country can be challenging. That's where an Employer of Record (EOR) in Estonia can provide valuable assistance. By partnering with an EOR, you can simplify your expansion efforts and ensure compliance with Estonian employment regulations. Our comprehensive insights into the role of an EOR in Estonia will guide you through the process, from payroll administration to HR support and legal compliance. With the expertise and local knowledge of an EOR, you can navigate the Estonian employment landscape with ease and focus on your core business objectives. Discover the benefits of partnering with an EOR in Estonia and unlock the potential of your international expansion.
| Overview | |
| Continent | Europe |
| Country | Estonia |
| Capital | Tallinn |
| Time zone | UTC+02:00 (EET) |
| Total Time zones | 1 |
| Working hours per week | 40 |
| Working week | Monday–Friday |
| Typical hours worked | 8 |
| Personal Tax filing deadline | 30th Apr |
| Financial Year | NA |
| Date format | dd/mm/yyyy |
| Currency | Euro (EUR) |
| VAT | the standard rate is 20% |
| Employers | % of Gross Salary |
| Pension | 20% |
| Health Insurance | 13% |
| Unemployment Insurance | 0.8% |
| Total Employment Cost | 33.8% |
| Employees | % of Gross Salary |
| Unemployment Insurance | 1.6% |
| Pension | 2% |
| Total Employee Cost | 3.6% |
| Minimum Wage | |
| Minimum Wage | The minimum wage in Estonia is 3.83 EUR per hour and 584 EUR per month. |
| Payroll | |
| Payroll Cycle | Monthly |
| 13th Salary | Not required by law. |
| Income Tax | |
| Flat Rate | 20% |
In Estonia, employee benefits are a crucial aspect of the overall compensation package. Health insurance is highly valued by employees, as it serves as a supplement to the national healthcare system, which can sometimes have long waiting lists. Additionally, retirement, death, and disability benefits are considered significant by Estonian employees. Let's take a closer look at the mandatory and supplementary employee benefits in Estonia:
Mandatory Employee Benefits:
#1Pension: Estonia has a three-pillar pension system:
- I Pillar: State Pension: The state provides a regular monthly income to individuals who have reached retirement age, become incapable of work, or lost their provider. It includes old-age pension, pension for incapacity for work, survivor's pension, national pension, and superannuated pension.
- II Pillar: Mandatory Funded Pension: Employees contribute 2% of their gross salary to a pension fund of their choice, and the state adds 4% from the social tax paid by the employee. The contributions are managed by fund management companies.
- III Pillar: Supplementary Funded Pension: Individuals have the option to make contributions to a voluntary pension fund or conclude a pension insurance contract with a life insurance company. The payments received depend on the chosen method.
#2
Legislative Leaves: Employees are entitled to various leaves, including maternity leave, paternity leave, parental leave, and sick leave, with continued payment of salary.
#3
Employment Insurance: Employers are required to contribute to the employment insurance fund, which provides benefits to employees in case of unemployment or insolvency of the employer.
#4
Dental Care: Employees may receive dental care benefits as part of their employment contract.
Supplementary Employee Benefits:
- Health Insurance: Many employers offer supplementary health insurance plans to provide additional coverage and access to healthcare services beyond the national system.
- Voluntary Benefits: Some employers may offer voluntary benefits, such as life insurance, disability insurance, or critical illness coverage, to enhance the overall employee benefits package.
- Gym Memberships: Companies often provide gym memberships or wellness programs to promote employee well-being and a healthy lifestyle.
Other Employee Perks:
- Additional Vacation Days: Employers may offer extra vacation days or the option to purchase additional time off.
- Company Cars: Some companies provide company cars or offer car allowances as part of the employee benefits package.
It's important for employers to understand and comply with the mandatory employee benefits in Estonia, while also considering supplementary benefits and perks to attract and retain top talent.
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