The first thing to know about employee benefits in Finland is that 95% of employees are covered by Collective Bargaining Agreements (CBA). Beyond providing life insurance benefits, CBAs impact on benefits provisions is limited. What is typically prescribed by a CBA includes leave, pay, and holiday requirements. Employers should be aware of any CBA that may be present on the national, industry, and company levels.
Mandatory employee benefits in Finland include workers’ compensation, statutory pension (TyEL), unemployment insurance, and Occupational healthcare. Desired supplementary employee benefits in Finland include supplemental medical, supplemental retirement plans, travel insurance, and life and disability insurance.
Mandatory employee benefits in Finland
- Compulsory Health Insurance (CHI) is financed by taxation. All citizens are covered by CHI.
- Mandatory Accident Insurance covers accidents happening at work (during working hours).
- The TyEL offers benefits on an earnings-related basis and must be provided by employers through a TyEL insurance contract if the employer hires employees as a company or corporation.
- Unemployment fund, The unemployment allowance is payable for 5 days a week. An unemployed is entitled to an unemployment daily allowance for 300 days.
- All employees in Finland are entitled to occupational health coverage. Under the Occupational Health Act, employers are required to arrange, at their own expense, professional-level occupational health services for their employees in order to prevent work-related health risks.
- Statutory leaves and allowances (annual leave, sick leave, maternity, parental leave, childbirth allowance).
- Additional days off are mandatory, and according to labor law, employees are granted additional days off due to work on weekends or public holidays.
Supplementary employee benefits in Finland
- Group Life and Disability Insurance – Many employers would provide this benefit as it tends to be one of the most cost-effective; there is no tax implication for the employee on the premiums, and it is of significant value as a protective measure should an employee pass away and leave their financial dependents encumbered by debt or significant loss of household income. The sum will generally depend on the sector. 2-4 x the base salary would be deemed a good level of benefit.
- Group Travel – Business travel insurance is almost seen as a must in sectors where the employees travel, and also occasional leisure travel is covered.
- Group Medical & Dental
- Private medical insurance remains one of the most popular benefits and is paid in full by the employer. EAP service, Telemedicine, and good coverage for in-patient hospital stays, day case procedures, consultant visits, and day-to-day benefits such as visits to specialist care and treatments are the most typical coverage. Employers typically supplement occupational health plans to decrease wait times for employees in public facilities. Supplemental coverage also increases access to services not typically included under the occupational plan.
- Dental insurance is available in Finland but is far less common, and generally, a paid benefit offered to employees and seen as part of the occupational healthcare scheme or as a perk Interest in this benefit has been slowly growing with domestic companies, though, too, in recent years.
- Supplemental pension – For employers that do contribute to a pension for employees, there are a number of structures available and the selection of which can depend on a number of factors, including the business’s own structure, number of employees, and headcount growth projection, remuneration, and recruitment strategies, parent company practices in other jurisdictions and industry benchmarking. Across all sectors, for employers that do offer a pension with a 100% employer contribution, the average level is between 5-25%, with an ordinary employee’s 5% contribution of base salary. The arrangement is a defined contribution group arrangement, as either bridging plans or top-up plans. The insurance is built for an objective collective group and is tax-free for employees and then taxed when paid out as a pension.
- Supplemental Accident insurance- Usually extended to leisure time to cover accidents 24/7 and also on leisure time when working remotely.
Common Perks in Finland
The most diverse employee benefits in Finland are typical of the IT, Tech, and Pharma industries, where you should be able to offer a little bit more than others in your field to be an attractive employer. Employers may be required to provide additional perquisites according to what is prescribed in Collective Bargaining Agreements.
Although the list of common perks in Finland is quite long, the most popular ones are intangible ones like education, extended occupational healthcare, flex work, and remote work (not to mention mobile phones, extended occupational healthcare, and meal vouchers, which are now taken for granted).
- Mobile phones – Around 97% of multinational companies provide mobile phones to all employees for business and private use.
- Meal vouchers – More than 75% of multinational companies provide meal vouchers for employees. The typical monthly meal voucher amount is €12,70 per working day for 2023.
- Workplace Canteens – This includes catered lunches for employees. Large employers often have an onsite cafeteria.
- Well-being and sports allowance – Around 60% of employers offer this tax-free benefit for their employees. This perk has an annual maximum of €400 for employees to buy a gym membership, go to the cinema, sports facilities, and PT services, etc.
- Extended occupational healthcare – Most companies offer a more comprehensive health package for employees consisting of medical care and treatments.
- Company cars – More than 15% of companies provide a company car to some or all executives and senior managers. Or, a car is provided to those employees who need to travel a lot for work (e.g., sales representatives).
- Bonus – 80% of employers provide incentive pay of up to 20% for senior executives, 15% for managers, and 5% for administrative staff. Holiday bonus: 50% of salary
- Stock purchase plan – 40% of employers provide for all employees. The typical maximum value is equal to 10% of the annual base salary.
- Stock options – 50% of employers provide options for senior executives, and a minority of employers provide for all employees.
- Employers may also establish a personnel fund with contributions tied to employees’ salaries. Employees are permitted to access the funds through loans and withdraw the entire fund balance upon exit from the company.
This information about employee benefits in Finland is provided by Söderberg& Partners Oy, Asinta’s employee benefits consulting Partner in the country.