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Finland

Basic Economic Summary

Finland is an economy that is a top performer in several metrics of national performances such as education, civil liberties, economic competitiveness, quality of life, and human development. The country has consistently ranked first on the World Happiness Report from the years 2018 - 2021 that has positively impacted the growth of the economy with regards to the work-life balance making it an ideal country to expand businesses into. With widespread prosperity and a high per capita income, the economy has largely remained an agrarian country while rapidly changing into an industrialized and advanced economy in no time giving opportunities to sectors such as energy, transport, manufacturing industries, public policy, healthcare, IT, and tourism.

Overview

  • Local Languages: Finnish, Swedish, English
  • Capital: Helsinki
  • Major Economic Hubs: Helsinki, Espoo, Tampere, Vantaa
  • Currency: Euro (EUR)
  • Population: 5.53 million
  • Time Zone: UTC+2 (EET), UTC+3 (EEST, Summer - DST)
  • Date Format: dd/mm/yyyy

Useful Information

  • GDP Per Capita (in USD): 44,733.2
  • Exchange Rate (EUR/USD): 1.12

Local Universities

Top Local Universities

University Rankings
University of Helsinki / Helsingin yliopisto Ranking in Finland: 1
World Ranking: 85
Aalto University / Aalto-yliopisto Ranking in Finland: 2
World Ranking: 211
University of Turku / Turun yliopisto Ranking in Finland: 3
World Ranking: 375
University of Oulu / Oulun yliopisto Ranking in Finland: 4
World Ranking: 398
Tampere University (TUT+UoT) / Tampereen korkeakouluyhteisö Ranking in Finland: 5
World Ranking: 404

The top universities in Finland are available on Webometrics.

Salary Data

Average Salary of Jobs (Per Month)

The table below shows the average salaries of some jobs in Finland. Please refer to SalaryExplorer for more information.

Job Title Average Salary Range (EUR) Average Salary Range (USD)
Surgeons/Doctors 9,420 to 26,300 11,193.03 - 31,250.19
Judges 7,910 to 22,100 9,398.82 - 26,259.66
Lawyers 6,410 to 17,900 7,616.49 - 21,269.14
Bank Managers 6,030 to 16,900 7,164.97 - 20,080.92
Chief Executive Officer 5,650 to 15,800 6,713.44 - 18,773.88
Chief Financial Officers 5,280 to 14,800 6,273.80 - 17,585.66

The average salary in Finland is 4,690 EUR with the lowest salary average being 1,190 EUR and the highest salary average being 20,900 EUR. One key piece of information to consider is that the average salary differs depending on the location, industry, and the profession the employee works at. You can find further information on the average wages in Finland here.

Talent Sourcing Tips

Taxes

Employer Payroll Tax

The employer payroll tax is calculated as follows:

Category Rate
Health Insurance 1.53%
Pension Insurance 16.95%
Unemployment Insurance 0.5% for first EUR 2,169,000 and 1.9% after
Group Life insurance 0.07%
Accident Insurance Premium 0.80%
Total 19.85%

Employee Payroll Tax

The employee payroll tax is calculated as follows:

Category Rate
Pension Insurance varies*
Health Insurance 1.65%
Unemployment Insurance 1.40%
Total 10.20%

*(7.15% for employees of age 17 to 52 years or 63 to 67 years and 8.65% for employees of age 53 to 62 years)

Employee Income Tax

Income Tax in Finland is calculated as follows:

Taxable income (EUR*)

Tax on column 1 (EUR)

Tax on excess (%)

Over Not Over
18,600 27,900 8.00 6.00
27,900 45,900 566.00 17.25%
45,900 80,500 3,671.00 21.25
80,500 11,023.50 31.25


Minimum Wage & Payroll

Minimum Wage

The minimum wage in Finland for new and renewal worker residence is €1,211.

Payroll Cycle

The employee must be paid monthly.

Bonus

13th month salary

There is no specific provision of 13th month salary in Finland.

Equity Stock Options (ESOP)

Employee stock options are a common and an established part of the remuneration packages that are offered to Finnish employees. They can be offered to select senior employees or all employees.

However, it is not mandatory to provide employee stock options as a part of an employees’ remuneration but can be provided as a part of additional compensation.

Working Hours & Statutory Leave

Working hours

The standard number of working hours in Finland is 8 hours a day or 40 hours a week.

Overtime pay

There is a 50% increase in wage for the first two hours of overtime and 100% for subsequent hours.

Public Holidays

Number of public holidays is 12 days. The list of holidays can be found here.

Leaves

Annual Paid Leave

In Finland, an employee can earn leave in three types of way:

  • According to 14 day rule
  • According to 35 hour rule 
  • According to the leave entitlement rule

The maximum amount of annual leave is either 24 days or 30 days.

Sick Leave

Paid sick leave in Finland is for a period of 9 workdays during each working year.

Parental Leave

The maternity leave given to female employees is for 105 days unpaid work which can begin 30 to 50 days before the birth of the child. Female employees are entitled to 8 weeks preceding the time of delivery and 8 weeks following the childbirth. Unpaid paternity leave is allowed for up to 54 days.

Offboarding & Termination

Termination Process

Termination in Finland can be done on a mutual consent basis.There can also be dismissal of the employee by the employer on the grounds of a justified reason.

Notice Period

Unless agreed otherwise in the employment agreement, the notice period is as follows:

  • Upto 1 year - 14 days notice
  • 1 - 4 years - 1 month in advance
  • 4 - 8 years - 2 months in advance
  • 8 - 12 years - 4 months in advance
  • Over 12 years - 6 months in advance

Severance Pay

Employees in Finland are not entitled to severance pay unless expressed in the agreement.

Probation period

The probation labour contract is six months.

Insurance

Arranging Social Security becomes mandatory if an employer pays a salary of more than EUR 1,300 to the employee during a calendar year. An employer must take out 3 separate insurance policies that include:

  1. Workers' compensation insurance 
  2. Unemployment insurance 
  3. Group life insurance

If the salary/wages an employer pays exceed the lower limit set by the tax authority of Finland, the employer must pay for the employees' social security contribution, i.e the health insurance contribution. However, if the salary is lesser EUR 1,300, the contribution is not mandatory.

VAT

The standard VAT in Finland is 24%. The reduced rates are 14%, 10%, and 0% for businesses in certain industries and sectors.

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