Estonia Work Culture

Work Culture in Estonia

To succeed in business in Estonia, it is vital for both employers and employees to have a strong understanding of the business culture.

As a global PEO (Professional Employment Organization) it is our goal to be familiar and updated with the business culture in the country we work with and in. By sharing our knowledge about Estonian work culture, we want to support your Global Expansion plans. Therefore, we will address all the aspects of the work culture in Estonia to start your expansion well-informed.

Work Culture

The Republic of Estonia may be among Europe’s smaller nations – with a population of just over 1.3 million – but it displays a go-getting attitude to international trade and is a front runner in digital innovation.

Estonia is the northernmost of it Baltic state neighbours, Lithuania and Latvia. It is an attractive land of lakes, forests, rivers and islands – 1,500 of them – while the Old Town in the capital, Tallinn, is the best-preserved medieval city in northern Europe. These are the attractions that can tempt incoming job seekers … alongside the economic and commercial benefits.

The modern, market-based economy had a Gross Domestic Product of US$36.4 billion in 2021, but outside the world’s top 50. However, GDP per capita was US$27,100 by the end of 2021, putting the nation comfortably inside the top 40.

Estonia’s location is in the northeast corner of the continent, but its membership in European institutions has given the nation an increasingly central role. Estonia has been in the European Union since 2004, the Schengen Area since 2007 and a member of the Eurozone since 2011. Additionally, Estonia is a member of the International Monetary Fund, the North Atlantic Treaty Organization, the Organization for Economic Co-operation and Development, the United Nations, the World Bank and the World Trade Organization.

The work culture and business etiquette can require new arrivals to adjust. Estonia also has a mix of eastern European cultures. 2022 demographics showed the declining population was 69% Estonian, 25% Russian, with the balance predominantly Ukrainian, Belarussian and Finnish.

Ready for the challenge? Now is the time to get down to business. So here are a few tips on taking the best steps and clearing those cultural barriers.

• Language:  At the business end of the scale, many Estonians are multi-lingual with a grasp of English, Russian, Finnish, German and Swedish. English speakers will get by – but hosts will be impressed with those who take the trouble to learn some words and phrases
• Punctuality: Be on time – Estonians expect appointments to be kept and have the same attitude to deadlines
• Business Attitudes:  Estonians have a strong work ethic and will assume others have the same approach. Initially rather ‘stiff’, as the relationship develops so the hosts will relax and enjoy more informality
• Negotiations: Expect counterparts to be ultra-direct and foreigners should be direct and precise with questions and observations. Generalized questions may not get a response 
• Greetings:  Firm handshake, eye contact. Respect personal space
• Business Cards:  Exchanged as part of the greetings process, but without any particular protocol
• Dress Code: Smart, tidy and formal is safest – always with good quality footwear. Dark suits for men and women are always a good choice
• Gift Giving:  Small, thoughtful gifts from the home country are acceptable; bunches of flowers should always have an odd number
• Out of Hours:  Lunches and dinners are a chance to become informal and display a social side, away from the conference room where the attitude will have focused on business

Estonia’s Minimum Wage

The national minimum is €654 (US$711) per month, equating to €7,848 (US$8,531) per year based on 12 monthly payments, as agreed by the Estonian Trade Union Confederation (EAKL) and the Employers’ Confederation for 2022. The hourly rate is €3.86 (US$4.20).

The national minimum applies to most private companies in Australia that are regulated by the Fair Work Act, (2009) and whose employees are covered by the National Employment Relations System.

Part-time employees are paid the same rate, adjusted pro rata for the hours they work. Casual workers are paid ‘casual loading’ above the minimum rate as they are not entitled to benefits such as sick leave or paid vacations.

Probation Periods in Estonia

Trial periods cannot exceed four months and the employer can terminate the probation by giving 15 days’ notice. In a fixed-term contract, the probation cannot exceed half of the contract up to the maximum of four months. Probation periods must be in the contract.

Working Hours in Estonia

The standard working week comprises five eight-hour days. Lunch breaks should be between 30 and 60 minutes. A single shift cannot exceed 12 hours.

Overtime in Estonia

Overtime cannot exceed 48 hours per seven days averaged over four months unless a different period is applied by law. Employees can agree to a total of 52 hours averaged over four months.