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Labour market

Estonia is a success story with regard to successful human capital potential maximization, ranking 15th globally.

  • #15 globally in human capital potential maximization
  • 1,096€ average monthly salary
  • 470€ minimum monthly salary

Recruiting employees

#15globally in human capital potential maximization

According to Human Capital Report Estonia is a success story with regard to successful human capital potential maximization, ranking 15th globally.

The Estonian labour market can be described by:

  • highly skilled workforce
  • 86% of adults speaking at least one foreign language
  • low unionisation
  • simple and straightforward labour legislation
  • easy hiring and job contract termination processes

Potential sources for finding suitable staff:

Work in Estonia has also listed a number of useful services that can be help when hiring either from Estonia or abroad, finding short-term employees, relocating employees, etc.

Labour legislation

Standard work week5 days

The legislation is liberal and offers a lot of flexibility in agreeing on terms and conditions of employment. Regulations regarding employment and labour contracts are regulated by the Employment Contracts Act.

A list of sample contracts in English can be found on the Work in Estonia webpage.

Information on labour taxes can be found here.

When planning to hire from abroad (non-EU or EU countries other than Estonia), the For Employers section of Work in Estonia can a be useful source of information on different legislation-related issues.

Working time & vacation

Standard working time per day8 h

The standard working schedule in Estonia is eight hours a day, five days per week. The duration of one shift may not exceed 12 hours.

Overtime is allowed by mutual agreement. The working schedule together with overtime cannot exceed on average 48 hours per seven days over a calculation period of four months, unless a different calculation period has been provided by law. Employer and employee may agree on a longer working schedule than 48 hours if the working schedule does not exceed, on average, 52 hours per seven days over a calculation period of four months and the agreement is not unfair to the employee. An employee may cancel the agreement at any time, giving two weeks’ advance notice thereof.

The duration of the annual vacation is 28 days, an extended vacation is granted in case of some professions, such as state officials and local government officials, teachers, academic, pedagogical and scientific staff and others. National holidays and public holidays are not included in the vacation duration calculations. An employee may be granted unpaid leave at his or her request for a period of time established by agreement of the parties.

Maternity leave – A woman is granted 140 days pregnancy and maternity leave, which may commence at least 70 days before the estimated birth date of the child. The maternity benefit is paid by the state.

Parental leave – A mother or a father shall be granted parental leave at her or his request for raising a child of up to 3 years of age. The parental benefit is paid by the state. Together the maternity benefit and the parental benefit are paid for a period of 575 days.

Sickness – in case of sickness, the employee can be given up to 182 calendar days of paid sick leave (max 250 days per year). The gross wage during this period is 70% of his or her last years` average salary. The employer pays the wage from the 4th to 8th day of sickness and the state starting the 9th day.

For more information on working and living in Estonia, please see the A to Z list of topics on the Work in Estonia webpage.

Salaries

Average monthly gross salary1,096€

Wages must be paid at least once a month and it is the employer’s obligation to calculate and withhold all payroll taxes.

When hiring, the general standard is a 4-month probation period with one-day notice period. Long-term employees have usually a 1 month notice period. If the working hours are at night (from 10:00 pm to 6:00 am), employers shall pay wages exceeding the normal wages by 1.25 times, unless it has been agreed that the wages include remuneration for working at night.

Work during public holidays may be compensated either by offering time off or by paying 2 times the wages for the work.

Payment for overtime – additional remuneration per hour of overtime is at least 50% of the rate of the hourly wage.

Information on labour taxes can be found here.

Labour market

Here are some useful links regarding the labour market:

You are also welcome to send us an enquiry for more specific information.

Doing business in Estonia

News & events

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Need more information?

What is it like to run a business in Estonia? How to benefit from the e-solutions and the efficiency of our business culture? What are the opportunities in specific sectors?

The Business in Estonia section helps you prepare for doing business in Estonia. And if you have any further questions, our business advisers are happy to help.

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