Estland
Regulations for working in Estonia
Überblick
Estonia is considered a digital pioneer in Europe – the country also offers optimal conditions for flexible work models such as workations, short-term business trips, or project-based assignments. Nevertheless, clear legal regulations must be observed when working in Estonia. These include registration requirements for foreign employees, labor law provisions, wage requirements, and social security matters. Especially in the case of cross-border employment, companies must ensure that all administrative and legal requirements are met. This page provides a concise overview of the most important regulations for working in Estonia – legally compliant, up-to-date, and practical.
EU Posted Workers Directive
What requirements apply?
Foreign employers must provide the Labour Inspectorate with information about the posting no later than the first day of work in Estonia. The registration form is available on the Labour Inspectorate's website and must be downloaded and then sent to posting@ti.ee.
Required Documents
Foreign employers must submit the following information and documents regarding the posting:
- Name
- Personal identification code or registration code
- Field of activity
- Information about the residence or location of the foreign employer
- Contact details of the company in Estonia receiving the posted workers
- Name and details of the contact person representing the foreign employer
- Name and contact details of the representative of the company receiving the posted workers
- Number of posted workers, their names, and personal identification codes or birthdates
- Expected duration of the posting
Additional documents that may be requested include the employment contract, work schedule, and proof of wage payment.
Documents in Estonian are not mandatory, but a translation may be required. A certified translation only needs to be provided upon request by the authorities. The authorities may request the documents for up to 3 years after the posting.
Failure to comply with the notification requirement for posted workers may result in a fine of up to 300 currency units (i.e., up to EUR 1,200) for a natural person and up to EUR 32,000 for a legal entity.
Labor Law
Minimum Wage
Estonia has a statutory gross minimum wage, which amounts to EUR 725 per month as of 2023. For non-EU nationals working as experts, consultants, or skilled professionals, the gross minimum wage is EUR 1,685 per month. For highly qualified workers holding an EU Blue Card, the gross minimum wage is currently EUR 2,528 per month.
Working Hours
The maximum working time in Estonia is 8 hours per day or 40 hours per week.
Failure to comply with applicable labor laws may result in financial liabilities, fines, or claims arising from local dismissal or working time regulations.
Social Security
If an employee from an EU country is posted to Estonia, Regulation (EC) No 883/2004 on the coordination of social security systems applies:
- A1 certificate is available: The employee remains covered by their home country’s social security system.
- Without A1 certificate: Estonian social security regulations apply, and the foreign employer must act like an Estonian employer.
Violations can lead to extensive administrative obligations, retroactive contribution payments (with interest), increased audits, and significant sanctions. Reputational damage can also occur.
Income Tax
- Foreign employers must withhold wage tax from the first day for remote workers residing in Estonia.
- For non-residents, tax must be withheld if they spend more than 183 days within 12 consecutive months in Estonia.
- Foreign employers must register in Estonia as non-resident employers.
- Employees must be entered into the employment register maintained by the tax authorities.
- Payslips must be prepared and provided to employees.
- By the 10th day of the month following the salary payment, foreign employers must submit monthly tax returns, specifying the gross wages, fringe benefits, and related taxes, and transfer the total wage tax amount to the tax authorities' bank account.
The consequences of non-compliance can vary depending on the situation but often include an immediate obligation to file a tax return in the host country, which can trigger further extensive implications for both employees and the company.
Immigration & Visas
International activities require exact compliance with international visa and entry requirements. The traveler, the type of activity, the purpose of stay and the duration are decisive for this, whether a business visa, a work visa or other special permits are required.
The consequences in case of infringement may include entry bans and associated loss of revenue, sanctions, fines and reputation damage.
Permanent Establishment
Employees working abroad can establish a permanent establishment through their activities in the target country and thus trigger a chain of financial and administrative consequences for companies.
The consequences of a violation may vary depending on the situation, but each establishment entails a significant administrative burden. In addition to registration, profit allocation and filing of the corporate income tax return, income tax obligations usually also arise.
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