An Overview of the Main Statutory Benefits
Estonia has a three-tier pension system available to employees: state pension, mandatory funded pension, supplementary funded pension.
The state pension is available to employees upon reaching retirement age who have worked in Estonia for a minimum of 15 years.
The mandatory pension is available to all employees who have made monthly contributions to the Social Tax. This contribution is mandatory for all employees born from 1st January 1983. Employees contribute 2% of their gross monthly salary towards a selected pension fund and an additional 4% will be added by the State. Employees born prior to this date can opt to pay The supplementary pension is made in the form of voluntary contributions or a pension contract with a life insurance scheme.
Employees are entitled to sick leave benefits in the event of illness, workplace accidents or injury upon presentation of a medical certificate.
Sick leave entitlement begins from the second day of illness. The second to the fifth day of leave are paid by the employer and any subsequent leave is paid by the Estonian Health Insurance Fund. An insured employee has the right to receive sickness benefit for 182 consecutive calendar days.
The sickness benefit is paid at a rate of 70% average income in the six months prior to leave.
For a workplace accident, the employee may be entitled to up to 100% of their average salary based on the assessment of a medical panel.
A pregnant employee is entitled to up to 140 calendar days of pregnancy and maternity leave, which can begin up to 70 days prior to the estimated due date.
A medical professional will issue a maternity certificate which must be presented to receive maternity pay.
Women are entitled to 100% pay for the duration of their maternity leave, funded by the Estonian Health Insurance Fund (Haigekassa).
Paternity leave of up to 30 days may be granted until the child reaches the age of three. Paternity benefit is paid by the employer and is compensated based on the average wage, up to a maximum of three-time Estonian mean gross wages. The employer has the right to submit an application to the Social Insurance Board for compensation of paternity benefit.
Unpaid Parental Leave: a mother or father may take up to 10 days’ unpaid leave to care for a child under the age of fourteen.
Academic Leave: employees are entitled to up to 30 days’ leave for job-related training and education. Up to 20 academic leave days are payable by the employer at a rate equal to the employee’s average daily pay.
Contractual Provisions
Public healthcare is funded by the Health Insurance Fund scheme and is provided by the national health system. The Fund signs annual contracts with medical providers and covers the cost for medical expenses of insured employees. Employees are able to access the healthcare scheme following completion of their first month of employment.
Estonian citizens will incur minimal fees for some outpatient treatments and consultations.
A medical examination should be carried out within the first four months of employment and reviewed every three years, or sooner if advised by a doctor.
It is a legal requirement for employers to provide a new employee with a full overview of the workplace rules and guidelines, including health and safety procedures.
Employers may choose to provide a probationary period in the contract of employment; the maximum term for probation is four months. It is currently not permissible for the probationary period to be extended; however, this is being reviewed in the case of employee sickness.
If the employer wishes to terminate the contract at the end of the probation period, they must provide fifteen days’ notice.
A regular working week consists of 8 hours per day and 40 hours per week.
Employees working more than six consecutive hours are entitled to a rest break of at least 30 minutes.
It is the responsibility of the employer to keep a record of the hours worked by its employees; this information can be requested by the Labour Inspectorate at any time.
Any work carried out exceeding the 40-hour working week is considered overtime.
Overtime work can be undertaken:
- upon mutual agreement between the employer and employee;
- in unforeseen circumstances at the request of the employer in the prevention of damage.