Employing in Finland

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Enter the Finnish market without the requirement of opening a local entity.

Expanding into
Finland

Global expansion is a step to make for any business, regardless of what you wish to achieve. The opportunities that can come with an expansion can be both incredibly exciting as well as intimidating and confusing, especially when you consider all of the registration procedures that needs to be done and documentation required.

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Finland Flag

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Expanding to countries such as Finland – which is characterized by a well-educated and experienced workforce, complex employment and tax laws, a well-developed infrastructure network, and leading sectors in electronics, chemicals, energy, manufacturing, agriculture, and services – can bring both excitement to the possibilities, but also significant stress to ensuring the entity with the country’s rigorous legal structures and laws.

Ensuring compliance without the sufficient knowledge of the country’s laws also adds to the stress of getting your new entity off the ground and ready to test new markets. Going at it without the proper support can increase the costs, time and risks involved.

Each new markets bring new challenges, and these can be worked through more efficiently and cost-effectively with the support of an International Professional Employer Organization (PEO) such as Bradford Jacobs, especially through our Employer of Record (EOR) framework. This can be best utilized when businesses are just beginning their expansion process and require more information before committing to incorporating an entity and fully establishing themselves in that market.

Country EOR Guide - Bradford Jacobs

Download our Guide to Finland

Learn all about expanding into the Finland and see what we can do to make your expansion easier.

Download our Guide to the Finland

Learn all about expanding into Finland and see what we can do to make your expansion easier.

Country EOR Guide - Bradford Jacobs

Hiring Staff
in Finland

Hiring Staff
in Finland

The Main Sectors of the Finnish Economy

Finland focuses on the following key sectors, which all have a significant impact on the country’s economy:

The technology industry in Finland is one of the country’s most important economic drivers. The technology industry has seen dramatic changes over the years. It is one of the world’s most volatile areas of business, and it is this volatility that has attributed to Finland’s aggressiveness in the design and production of various electronics.

Finland’s technology industry also includes five sub-sectors, which are the electronics, metals, mechanical engineering, information technology, and consult engineering industries.

The technology industry contributes to around 50% of total exports, around 317,000 direct employment (around 670,000 including indirect employment), 65% of private sector R&D investment, and 28% of total GDP.

Finland differs from other automobile manufacturing countries such as Germany and Japan in that the focus is on industrial machinery. The motor industry is predominantly composed of manufacturers of forest machines, tractors, trucks, military vehicles, and buses.

Finland is also renowned for having a robust shipbuilding industry. Some of the world’s largest and highly reputed cruise ships have been built in Finland. There are at least eight shipyards across the country, and they employ close to 20,000 people. Altogether, the manufacturing industry employs about 400,000.

Similar to the growth of the electronics industry, Finland’s motor industry (and particularly shipbuilding) has seen significant growth thanks to heavy investment in R&D. Government support also accounts for much of the growth. Valmet and Wartsila are some of the most notable companies in this industry. Wartsila alone holds a stunning 47% market share and is the producer of the largest diesel engines in the world. 90% of the produce from the shipping industry is exported.

Forestry in Finland, at the moment, is responsible for about a fifth of Finland’s exports. Forest products for years have been significant export items in Finland. The growth and diversification of the Finnish economy have seen a decline in these exports.

Despite the reduction in forest product exports, pulp and paper remain a critical industry with more than 50 sites countrywide. Additionally, some of the largest international corporations in the business of pulp and paper are headquartered in Finland. UPM and Stora Enso are examples of such corporations.

Their global output has been estimated to be more than 10 million tons. The forest industry is responsible for about 15% of jobs in Finland.

Hydroelectric power produces about 16% energy supply in Finland generated by nuclear power and 26%. The consumption of energy is distributed among industries, heating, and transportation. Traditionally, Finland has been a massive importer of energy due to its lack of indigenous fossil fuels. However, this changing as the country turns to nuclear energy.
The mining industry in Finland has experienced significant transformation in recent years. The discovery of copper and nickel ores in the infant years of the 20th century set the country on a venture to develop the mining industry. The government invested heavily in the prospecting, and multiple domestic players participated in extensive exploration activities.

However, exploration has practically ceased, and over time the mining operations and various roles in the mining industry have been taken over by foreign organizations.

Finland is however still a major exporter of copper, nickel, zinc, chromium, and steel. There is also the export of finished products including steel pipes, roofing materials, and cladding.

The Main Sectors of the Finnish Economy

Finland focuses on the following key sectors, which all have a significant impact on the country’s economy:

Finland Landscape
The technology industry in Finland is one of the country’s most important economic drivers. The technology industry has seen dramatic changes over the years. It is one of the world’s most volatile areas of business, and it is this volatility that has attributed to Finland’s aggressiveness in the design and production of various electronics.

Finland’s technology industry also includes five sub-sectors, which are the electronics, metals, mechanical engineering, information technology, and consult engineering industries.

The technology industry contributes to around 50% of total exports, around 317,000 direct employment (around 670,000 including indirect employment), 65% of private sector R&D investment, and 28% of total GDP.

Finland differs from other automobile manufacturing countries such as Germany and Japan in that the focus is on industrial machinery. The motor industry is predominantly composed of manufacturers of forest machines, tractors, trucks, military vehicles, and buses.

Finland is also renowned for having a robust shipbuilding industry. Some of the world’s largest and highly reputed cruise ships have been built in Finland. There are at least eight shipyards across the country, and they employ close to 20,000 people. Altogether, the manufacturing industry employs about 400,000.

Similar to the growth of the electronics industry, Finland’s motor industry (and particularly shipbuilding) has seen significant growth thanks to heavy investment in R&D. Government support also accounts for much of the growth. Valmet and Wartsila are some of the most notable companies in this industry. Wartsila alone holds a stunning 47% market share and is the producer of the largest diesel engines in the world. 90% of the produce from the shipping industry is exported.

Forestry in Finland, at the moment, is responsible for about a fifth of Finland’s exports. Forest products for years have been significant export items in Finland. The growth and diversification of the Finnish economy have seen a decline in these exports.

Despite the reduction in forest product exports, pulp and paper remain a critical industry with more than 50 sites countrywide. Additionally, some of the largest international corporations in the business of pulp and paper are headquartered in Finland. UPM and Stora Enso are examples of such corporations.

Their global output has been estimated to be more than 10 million tons. The forest industry is responsible for about 15% of jobs in Finland.

Hydroelectric power produces about 16% energy supply in Finland generated by nuclear power and 26%. The consumption of energy is distributed among industries, heating, and transportation. Traditionally, Finland has been a massive importer of energy due to its lack of indigenous fossil fuels. However, this changing as the country turns to nuclear energy.
The mining industry in Finland has experienced significant transformation in recent years. The discovery of copper and nickel ores in the infant years of the 20th century set the country on a venture to develop the mining industry. The government invested heavily in the prospecting, and multiple domestic players participated in extensive exploration activities.

However, exploration has practically ceased, and over time the mining operations and various roles in the mining industry have been taken over by foreign organizations.

Finland is however still a major exporter of copper, nickel, zinc, chromium, and steel. There is also the export of finished products including steel pipes, roofing materials, and cladding.

Commercial Laws
in Finland

  • Finnish Tax Administration – The Tax Administration collects taxes to safeguard the functioning of the Finnish society. Every year, tax recipients receive over €50 billion in tax revenue. The Tax Administration safeguards the revenue stream through credible tax control and by providing proactive guidance and good service. The goal is to help all taxpayers conduct their tax matters independently and correctly, from private individuals to businesses, corporations, and non-profit organizations.
  • Finland Labor Council – The Labor Council is an independent special authority coming under the Ministry of Economic Affairs and Employment. It has a minimum of nine part-time members three of whom are independent. The other members represent employer and employee organizations. The Government appoints the members for a term of three years. The Labor Council issues opinions on the application and interpretation of legislation on working hours, annual holidays and occupational safety and health and a number of other acts on the protection of employees. The Labor Council also considers the requests for correction concerning the decisions on occupational safety and health derogation permits issued by Regional State Administrative Agencies.
  • The Occupational Safety and Health Administration – The purpose is to ensure that working in Finland is as healthy and safe as possible and in compliance with working life legislation. Our job is to improve the working environment and working conditions in order to safeguard and maintain the work ability of employees. Their duties further include preventing occupational accidents and occupational diseases and reducing the adverse physical and mental health impacts of work on employees. They also issue advice and guidelines concerning occupational safety and health and concerning the terms and conditions of employment relationships.
Contracts in Finland are usually open-ended and can be presented in a more informal way than in some other territories. For example, they can be oral, written, or electronic and need not be in writing unless requested by either party. Contracts are typically exchanged by email with scanned documents and electronic signatures. There is no legal requirement to exchange hard copies of documentation or regarding the language used.

However, they must detail essential points covering business location, employee’s place of work, termination date of any fixed-term contract, any trial period, employee’s duties, any collective agreement, salary and payment schedule, annual holiday, notice periods and sick pay.

Finland residents are taxed on their worldwide income at various rates, plus flat rates for church taxes (where applicable) and municipal taxes. Individuals are considered tax residents if they have a home in Finland or have stayed there for more than six months.

Non-residents are taxed only on their Finnish income at 35% unless tax treaties apply.

Taxable income includes all the employees’ remuneration or compensation, including sums directly or indirectly arising from their employment. Taxable earned income categories include:

  • Basic salary, bonuses, fringe benefits
  • Cost of living and housing allowances
  • Reimbursed expenses for travel, accommodation, meals
  • Entertainment expenses
  • Profit-sharing schemes

Taxable investment income includes:

  • Income from property
  • Capital gains
  • Any income earned from assets

For more information Download our Finland Country Guide…

Commercial Laws
in Finland

Finland Waterfront with Buildings
  • Finnish Tax Administration – The Tax Administration collects taxes to safeguard the functioning of the Finnish society. Every year, tax recipients receive over €50 billion in tax revenue. The Tax Administration safeguards the revenue stream through credible tax control and by providing proactive guidance and good service. The goal is to help all taxpayers conduct their tax matters independently and correctly, from private individuals to businesses, corporations, and non-profit organizations.
  • Finland Labor Council – The Labor Council is an independent special authority coming under the Ministry of Economic Affairs and Employment. It has a minimum of nine part-time members three of whom are independent. The other members represent employer and employee organizations. The Government appoints the members for a term of three years. The Labor Council issues opinions on the application and interpretation of legislation on working hours, annual holidays and occupational safety and health and a number of other acts on the protection of employees. The Labor Council also considers the requests for correction concerning the decisions on occupational safety and health derogation permits issued by Regional State Administrative Agencies.
  • The Occupational Safety and Health Administration – The purpose is to ensure that working in Finland is as healthy and safe as possible and in compliance with working life legislation. Our job is to improve the working environment and working conditions in order to safeguard and maintain the work ability of employees. Their duties further include preventing occupational accidents and occupational diseases and reducing the adverse physical and mental health impacts of work on employees. They also issue advice and guidelines concerning occupational safety and health and concerning the terms and conditions of employment relationships.
Contracts in Finland are usually open-ended and can be presented in a more informal way than in some other territories. For example, they can be oral, written, or electronic and need not be in writing unless requested by either party. Contracts are typically exchanged by email with scanned documents and electronic signatures. There is no legal requirement to exchange hard copies of documentation or regarding the language used.

However, they must detail essential points covering business location, employee’s place of work, termination date of any fixed-term contract, any trial period, employee’s duties, any collective agreement, salary and payment schedule, annual holiday, notice periods and sick pay.

Finland residents are taxed on their worldwide income at various rates, plus flat rates for church taxes (where applicable) and municipal taxes. Individuals are considered tax residents if they have a home in Finland or have stayed there for more than six months.

Non-residents are taxed only on their Finnish income at 35% unless tax treaties apply.

Taxable income includes all the employees’ remuneration or compensation, including sums directly or indirectly arising from their employment. Taxable earned income categories include:

  • Basic salary, bonuses, fringe benefits
  • Cost of living and housing allowances
  • Reimbursed expenses for travel, accommodation, meals
  • Entertainment expenses
  • Profit-sharing schemes

Taxable investment income includes:

  • Income from property
  • Capital gains
  • Any income earned from assets

For more information Download our Finland Country Guide…

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