Hiring an employee in Finland requires more than agreeing on salary and start date.
A foreign company must consider employment contracts, payroll, tax withholding, employer contributions, insurance, right-to-work checks and HR administration.
For companies without a Finnish legal entity, this can be difficult.
An Employer of Record can simplify the process.
Step 1: Confirm the employee’s status
Before onboarding starts, confirm whether the person:
- is a Finnish citizen;
- is an EU/EEA citizen;
- is a non-EU citizen with a residence permit;
- is moving to Finland from abroad;
- already has the right to work in Finland.
This is especially important for international hires.
Official Finnish employment guidance states that employers hiring international skilled workers must ensure the employee’s right to work, make necessary notifications and keep records.
Step 2: Decide the legal structure
A foreign company has several possible structures:
- open a Finnish company;
- register as an employer in Finland;
- hire the person as a contractor;
- use an Employer of Record.
For one or a few employees, EOR is often the simplest option.
With EOR, TaigaTrust becomes the legal employer in Finland and handles the local employment administration.
Step 3: Prepare the employment contract
Finnish employment contracts should clearly define the key employment terms.
These may include:
- job title;
- work duties;
- start date;
- salary;
- working time;
- place of work;
- remote work terms;
- holiday terms;
- probation period;
- notice period;
- confidentiality;
- intellectual property;
- applicable policies.
Finnish occupational safety guidance states that an employment contract may be verbal, written or electronic, but written contracts are recommended because the terms can be verified later.
For foreign companies, a written contract is essential.
Step 4: Set up payroll
Payroll must be handled correctly from the first salary payment.
This usually includes:
- gross salary calculation;
- tax withholding;
- employee deductions;
- employer contributions;
- salary payment;
- payroll reporting;
- payslips;
- annual and monthly administration.
If the company has no Finnish payroll setup, EOR can handle this locally.
Step 5: Arrange statutory employer obligations
Employment in Finland may require pension insurance, accident insurance, unemployment insurance and other statutory arrangements depending on the situation.
If the employee works remotely in Finland for a foreign employer, the Finnish Centre for Pensions explains that the employer may need to arrange statutory social security in Finland unless an exception such as an A1 certificate applies.
This is one of the most important onboarding issues for foreign employers.
Step 6: Agree on daily management
In an EOR model, the client company usually manages the employee’s daily work.
This includes:
- tasks;
- projects;
- reporting;
- tools;
- performance expectations;
- business communication;
- team integration.
TaigaTrust handles the employment administration, while the client company remains responsible for business management.
Step 7: Clarify cost structure
Before the employment starts, the foreign company should understand the full cost.
This may include:
- gross salary;
- employer contributions;
- insurance costs;
- holiday pay;
- other statutory employment costs;
- EOR monthly fee.
TaigaTrust can provide an estimated employment cost calculation before onboarding.
Step 8: Keep documentation
The company should keep proper documentation of:
- commercial agreement with EOR;
- employment contract;
- employee information;
- salary and payroll records;
- right-to-work documentation;
- job description;
- remote work terms;
- HR communications.
Good documentation reduces risk and makes future changes easier.
Conclusion
Onboarding an employee in Finland requires a structured process.
Foreign companies must consider employment law, payroll, tax, social security, insurance and immigration issues.
TaigaTrust helps international companies onboard employees in Finland through an Employer of Record model.
If your company is preparing to hire a Finland-based employee, contact TaigaTrust for an onboarding consultation.
