Payroll Cycle
Minumum Wage
Overtime Pay
Visa Immigration

Talent Wiki - Estonia

Your quick guide on talent and labor compliance norms in Estonia
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Capital
Tallinn
Currency
Euro
Languages
Estonian
Payroll Frequency
Monthly
GDP per Capita
$29,735
Employer Tax
33.80%

Supplementary Guide for Employment and Expansion in Estonia

Talent Overview

Estonia has a market-based economy and is currently the 7th freest economy in the world (with a freedom score of 80.0). Being a part of the European Union has worked in their favor as their economy heavily relies on trade. This allowed them to maintain strong economic ties with Finland, Sweden, and Germany. Moreover, Estonia’s telecommunications and electronics sectors have also contributed to its continued growth and development.

Major economic hubs:

Tallinn, Tartu, Narva

Skills in demand :

 ICT professionals, Healthcare professionals, legal professionals

Local Universities

Top Local universities in Estonia are:

University of Tartu / Tartu Ülikool

RANKING

Local : 1

World : 433

Tallinn University of Technology / Tallinna Tehnikaülikool

RANKING

Local : 2

World : 1080

Tallinn University / Tallinna Ülikool

RANKING

Local : 3

World : 1641

Estonian University of Life Sciences / Eesti Maaülikool

RANKING

Local : 4

World : 1805

Estonian Business School / EBS Rahvusvaheline ülikool

RANKING

Local : 5

World : 6349

Salary Data

No. Job Title Average Salary (in EUR) Average Salary (in USD)
1 Financial Manager 5,420 EUR 6,010.01
2 Chief Financial Officer 5,290 EUR 5,865.86
3 Accounting Manager 4,070 EUR 4,513.05
4 Business Development Manager 4,120 EUR 4,568.49
5 Financial Analyst 3,520 EUR 3,903.18
6 Customer Service Manager 3,520 EUR 3,903.18

Talent Sourcing Tips

Top Local Job Boards:

CV.ee, cvkesus.ee, Eures

Number of LinkedIn users:

285,500

Top Recruitment Agencies:

Soshace, BrainAgency, Pconsult

Employing in Estonia

Employees in Estonia are characterized as highly skilled, making the country’s labor market a promising opportunity for global businesses. Additionally, labor laws and rules are easy and straightforward. Here are some things that employers need to know about employing in Estonia.

Employee Contract

The primary language used in employment contracts is Estonian Language. However, the language of the contract can be in a foreign language if both parties agree to using such.

Probation Period

Employees in Estonia are given from 1 to 4 months of probation period.

Public and Provincial Holidays

Date Name Type
1 Jan New Year's Day National holiday
24 Feb Independence Day National holiday
15 Apr Good Friday National holiday
17 Apr Easter Sunday National holiday
1 May Labor Day National holiday
5 Jun Pentecost National holiday
23 Jun Victory Day National holiday
24 Jun Midsummer Day National holiday
20 Aug Independence Restoration Day National holiday
24 Dec Christmas Eve National holiday
25 Dec Christmas Day National holiday
26 Dec Boxing Day National holiday

Payroll

Payroll Cycle

Employees in Estonia are paid once a month.

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Minimum Wage

The minimum hourly wage in 2022 is 3.86 EUR (gross) and the minimum monthly wage is 654 EUR (gross).

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Overtime Pay

Overtime work should not exceed over 8 hours within a 7 day period. The period of overtime may offset work days unless employers agree to compensate the employee’s extra work with money. If so, Overtime is compensated at a rate of 1.5 times the wages.

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Health Examination Clause

Bonus

13th Month Pay

A 13th month pay is not mandatory in Estonia.

Employee Benefits

Estonia offers a lot of benefits for their employees. Below are some of them:

  • ~Maternity leave
  • ~Paternity leave
  • ~Pension system
  • ~Employment Insurance
  • ~Health Insurance
  • ~Dental Care
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Taxes

Employer Payroll Tax

Category Rate
Pension 20.00%
Health Insurance 13.00%
Unemployment Insurance 0.80%

Employee Payroll Tax

Category Rate
Pension 2.00%
Unemployment Insurance 1.60%

Employee Income Tax

Estonia has a flat rate of 20% for all items acquired through income.

VAT

The country’s standard VAT is 20%. However, it can be reduced by 9% for certain commodities such as books and periodicals, medicines and medical equipments, accommodation, sanitary and toiletry products.

Offboarding & Termination

Termination Process

Termination in Estonia can take place in three ways:

  • ~Immediate Termination - An employer terminates the contract immediately due to misconduct
  • ~Employee Resignation - An employee can send a written resignation between 14 days to 1 month.
  • ~Termination with notice - Notice period is determined from the employee agreement.

Notice Period

Probationary employees’ notice period depends on the contract between the employee and employer while non-probationary employees have up to 15 - 90 days.

Severance Pay

If the contract is terminated due to redundancy, the employer must pay compensation of one month’s average wage for the employee’s last six month’s salary. For employment terms between 5 and 10 years, an additional one month’s pay has to be given.

Visa and Immigration

Estonia belongs from a part of European Union (EU), foreign workers belonging to the EU need no visa to enter the country. If they are to work and stay in Estonia for more than three months, they only need to apply for a residence permit at the Population Register of Estonia and secure an Estonian ID card. 

Non-EU citizens must apply for a Schengen D-visa and a residence permit to stay and work for more than three months in the country.

Additionally, Estonia launched a Digital Nomad visa last August 1, 2020, to encourage remote workers to travel to the country and work there. It allows foreigners to work in Estonia legally even when their employers or business is registered abroad. 

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