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Submission of documents required for state or administrative supervision

Upon the Labour Inspectorate’s request, the employer of a posted worker is immediately required to provide the Labour Inspectorate any documents necessary for state or administrative supervision.

This document can be:

  • employment contract
  • employment schedule
  • statement confirming payment of wages, or
  • any other document confirming the observance of the terms and conditions of employment applicable to the posted worker.

The Labour Inspectorate has the authority to request such documents for up to 7 years (subsection 12 (1) of the Accounting Act) after the conclusion of the worker’s posting period. Upon the Labour Inspectorate’s request, the employer of a posted worker is required to provide the Labour Inspectorate any documents necessary for state or administrative supervision. If the employer fails to present the data or documents requested with regard to workers posted to Estonia, the Labour Inspectorate is authorised to issue a relevant precept and, in case of non-compliance with the precept, impose a penalty payment. The maximum amount of the penalty payment is 9,600 euros.

Generally applicable collective agreements

In the field of healthcare, the Estonian Hospitals Association, the Union of Estonian Emergency Medical Services, the Family Physicians Association of Estonia, the Estonian Medical Association, and the Estonian Healthcare Workers’ Association have collectively signed the Healthcare professionals’ collective agreement, covering a total of 25,000 workers based on the collective agreement database.

This collective agreement covers all institutions and undertakings providing healthcare services based on an activity licence issued by the Estonian Health Board and whose activity is funded under a treatment funding agreement concluded with the Estonian Health Insurance Fund or from the stage budget, and employees working at said institutions and undertakings.

Healthcare professionals’ collective agreement (EST)

In the field of transportation, two collective agreements have been signed between the Association of Estonian Road Carriers and the Estonian Transport and Road Workers’ Union.

The general working agreement for the transport of passengers regulates the occupational, professional, and social relationships between members of the Association of Estonian Road Carriers and the Estonian Transport and Road Workers’ Union engaged in the transport of passengers.

The working and resting time and remuneration terms established in the general working agreement for the transport of passengers extend to and are mandatory for all employers and employees engaged in bus transport in the sense of the Public Transport Act and using temporary agency workers for this purpose, regardless of the type of the contract they have concluded.

General working agreement for the transport of passengers (EST)

The general working agreement for the domestic transport of goods regulates the occupational, professional, and social relationships between members of the Association of Estonian Road Carriers and the Estonian Transport and Road Workers’ Union engaged in the domestic transport of goods.

The working and resting time and remuneration terms established in the general working agreement for the transport of passengers extend to and are mandatory for all employers and employees engaged in the domestic transport of goods and using temporary agency workers for this purpose, as well as self-employed contractors (including self-employed workers) who are parties to a contract that bears the characteristics of an employment contract and whose main contractual obligation is transportation of goods. These conditions extend to and are mandatory for all skilled workers and self-employed contractors (including self-employed workers) involved in the repairs of rolling stock who are parties to a contract for the repairs of rolling stock that bears the characteristics of an employment contract and employed or working on a temporary basis for employers engaged in the transport of goods. The remuneration conditions established in the general working agreement do not extend to employers and employees engaged in and using temporary agency workers for the domestic transport of roundwood.

General working agreement for the domestic transportation of goods (EST)

The minimum salary agreement, approved by the Government of the Republic of Estonia, applies to all sectors. In 2018, the minimum hourly salary is 2.97 euros (gross) and the minimum monthly salary for full-time work is 500 euros (gross). A separate minimum salary for basic and upper secondary school teachers is also in force, amounting to 1150 euros per month (gross) in 2018.


Rules for the application of social security systems to persons working in the European Union, the European Economic Community, and Switzerland

In order for a person to be able to freely choose their state of residence and work in the European Union (EU), they must also be guaranteed the right for free medical assistance, sickness benefits, pension, benefits for accidents at work and occupational diseases, unemployment benefits, and family benefits for their children.

The social protection of cross-border workers cannot always be ensured by only applying the law of a single state. The EU has thus adopted a set of rules for the coordination of social security systems. These are found in Regulation (EC) No 883/2004 of the European Parliament and of the Council  and its implementing regulation (EC) No 987/2009. The rules used by social security institutions for determining the member state whose social security legislation is applicable to a person in question are set out in Title II of those regulations.

The rule of thumb is that workers, as well as self-employed persons moving within the European Economic Area (all EU member states, Norway, Liechtenstein, Island, and Switzerland) are subjected to the social security scheme of only one single member state. As a rule, this is the social security system of the state where the worker or the self-employed person works, regardless of the state where the worker or self-employed person lives or where their employer is located.

However, in a situation where a person’s work as a worker or a self-employed person is related to more than one EU member state, it is necessary to determine which social security system they are subject to. Such situations include the temporary posting of workers and working/being active in several states at once. Rulings regarding which state’s social security system and legislation the person is subjected to are made by social security institutions based on currently valid legal acts and the person’s actual situation. The state whose social security legislation is ruled to be applicable will then provide the person with the A1 certificate.

The A1 certificate (Certificate of social security legislation applicable to the holder of the certificate) is a certificate introduced by the European Commission that can be used by a person posted to another state or working in more than one state to certify to the relevant agency of the receiving country that the person in question is already subject to the social security legislation of another state. This also means that the holder of the certificate is also not required to pay social security payments in other states; all their employers will instead pay social security contributions in the state that has issued their A1 certificate, thus also guaranteeing the person all social rights and benefits arising from the legislation of this state.

In case of working in more than one state, the A1 certificate must always be issued by the state where the worker lives or, in case of cross-border work, the state from which the worker is to be posted to another state.

For more details, see the website of the Estonian National Social Insurance Board: https://www.sotsiaalkindlustusamet.ee/et/avaleht/sotsiaalkindlustus-euroopa-liidus


The Aliens Act

The entry of foreign nationals (other than citizens of the member states of the European Union, citizens of the European Economic Area or citizens of the Swiss Confederation and members of their family who have the right to stay or live in Estonia for the purposes of the Citizen of European Union Act) into Estonia and their rights and obligations during their residence, stay, or work in Estonia are regulated by the Aliens Act.


Working as a foreign national

If the purpose of a foreign national’s (other than citizens of the member states of the European Union, citizens of the European Economic Area or citizens of the Swiss Confederation) stay in Estonia is to work here, they must have a residence permit for working. A foreign national can be employed in Estonia for a short term if they have a legal right to stay in Estonia (for example, under a visa or visa-free) and their employment has been registered with the Police and Border Guard Board before the commencement of employment.

More detailed information about the registration of short-term employment can be found on the official website of the Estonian Police and Border Guard Board.

The Aliens Act regulates the arrival of foreign nationals in Estonia, their temporary stay in Estonia, as well as the basis of residence and employment.

The Police and Border Guard Board provides a counselling service to foreign nationals. The counsellor can be contacted by phone at 612 3500, by e-mail at migrationadvice|at|politsei.ee, via Skype, or by reserving an appointment.

Information about this service is available here (in English) or here (in Estonian).

Before the foreign national can apply for a residence permit for employment with the Police and Border Guard Board, the employer is generally required to have the permission of the Unemployment Insurance Fund for employing a foreign national. 

More information on this is available on the official website of the Estonian Unemployment Insurance Fund

If the employed foreign national lacks an Estonian personal identity code and they are unable to apply for one before commencing employment for objective reasons, the employer can register their employment for up to five days using the birth date listed in the employee’s identification documents. An employee registered using their date of birth will not be able to benefit from social guarantees. For more information, see the instructions on the registration of non-national employees on the website of the Tax and Customs Board.

 

Registering a non-resident employer

Any non-resident employer, including a self-employed person, foreign mission, other agency of a foreign state, international organisation or a representation of such an organisation that has not been previously registered in the register of taxable persons or any other registry instituted in Estonia is obligated to register themselves with the Tax and Customs Board within ten working days of the creation of tax liability in Estonia. For more information, see the instructions on tax liability of non-resident employers on the website of the Tax and Customs Board.


Applicable terms and conditions of employment

In Estonia, employment relations are regulated by the Employment Contracts Act, available on the website of Riigi Teataja.

The purpose of the act is to regulate the relationships between employers and employees, thereby ensuring that the employees are provided sufficient safety in accordance with the principle of welfare state, enabling undertakings to bring to fruition their constitutional right to engage in entrepreneurial activity, and contributing to the increased competitiveness of Estonian economy.


An employer must ensure that the following working conditions apply to posted workers in Estonia:

Important! Exception: The working conditions effective in Estonia are not applied in the case of an up to eight-day posting if the posted worker is a skilled worker whose duty is the initial assembly or first installation of goods necessary for taking the goods ordered into use, if such work is an integral part of a subscription contract. The derogation does not apply if the work done by the posted worker is connected with construction work involving the construction, renovation, maintenance, alteration or demolition of buildings, including excavation work, earthmoving work, actual construction work, or the assembly and demolition, connection and installation, modification, renovation, repair, disassembly, demolition, maintenance, painting, cleaning or repair of prefabricated components. The periods of time worked by another employee posted to Estonia by the same employer for the performance of the same work in the year leading up to the commencement of the posting are taken into consideration in the calculation of the up to eight-day posting period.

In the application of annual holiday, compensation paid in cash in connection with the posting is considered to be part of wages, unless it is paid to cover travel, accommodation or meal expenditures incurred during the course of the posting.

Important! Exception: The working conditions effective in Estonia are not applied in the case of an up to eight-day posting if the posted worker is a skilled worker whose duty is the initial assembly or first installation of goods necessary for taking the goods ordered into use, if such work is an integral part of a subscription contract. The derogation does not apply if the work done by the posted worker is connected with construction work involving the construction, renovation, maintenance, alteration or demolition of buildings, including excavation work, earthmoving work, actual construction work, or the assembly and demolition, connection and installation, modification, renovation, repair, disassembly, demolition, maintenance, painting, cleaning or repair of prefabricated components. The periods of time worked by another employee posted to Estonia by the same employer for the performance of the same work in the year leading up to the commencement of the posting are taken into consideration in the calculation of the up to eight-day posting period.


Conditions of temporary agency work

Pursuant to subsection 111 (21) of the Equal Treatment Act, employees who perform duties by way of temporary agency work are entitled to the same conditions of working and rest time and remuneration and access to the meal, transportation and childcare services of the user undertaking as comparable employees of the user undertaking.

Notification obligation

The employer must comply with different forms of notification obligations related to temporary agency workers.

1.    The employer must notify the employee of the information listed in subsection 5 (1) of the Employment Contracts Act, including their duties and remuneration, as well as sign a written agreement with the employee regarding the working conditions in special cases listed in section 6 of the act. Temporary agency work is considered one of such special cases.

2.    Pursuant to subsection 6 (5) of the Employment Contracts Act, the employer must notify the employee if the duties are performed by way of temporary agency work in the user undertaking.

3.    Pursuant to clause 28 (2) 91) of the same act, an employer is obligated to notify an employee who is performing duties by way of temporary agency work of vacant positions in the user undertaking corresponding to his or her knowledge and skills with regard to which an employment contract can be entered into for an unspecified term, unless the user undertaking has notified the employee of the vacant positions. As an example, a temporary agency worker might be employed for a fixed term by the user undertaking as a website administrator; at the same time, the user undertaking might also create a position for a website administrator at the undertaking with an unspecified term. In such case, the employer will be obligated to notify the temporary agency worker of this position. If, however, the user undertaking has already informed this employee of the vacant position, no separate notification obligation will arise for the employer.

4.    Pursuant to clause 20 (1) 1) of the Employees’ Trustee Act, an employer is obligated to inform the undertaking’s trustee of employees performing duties by way of temporary agency work if changes and planned decisions related to this will significantly affect the structure of the employer and the staff. For instance, the employer is obligated to provide information regarding the positions and number of temporary agency workers employed at the user undertaking.

Signing fixed-term employment contracts

Fixed-term employment contracts are regulated by section 9 of the Employment Contracts Act. An employment contract may be signed for a specified term if it is justified by good reasons arising from the temporary fixed-term characteristics of the work, especially a temporary increase in work volume or performance of seasonal work. In case of temporary agency work, a fixed-term contract can also be signed with a temporary agency worker if this is related to the temporary characteristics of the work of the user undertaking. Accordingly, the employer can sign a fixed-term employment agreement with a temporary agency worker under two circumstances:

1.    a fixed-term contract is justified by reasons arising from the temporary fixed-term characteristics of the employer’s work (e.g. the employer requires a substitute worker or work volume has temporarily increased);

2.    a fixed-term contract is justified by reasons arising from the temporary fixed-term characteristics of the user undertaking’s work (e.g. the user undertaking requires an employee performing their duties in the form of temporary agency work to substitute for another employee, or the user undertaking requires extra work force for seasonal work).

Extension of a fixed-term contract and restrictions on consecutive contracts

For the protection of employees, section 10 of the Employment Contracts Act foresees a number of restrictions on the conditions under which a fixed-term contract with an employee can be extended or new consecutive contracts signed. In case of temporary agency work, the restrictions on consecutive entry into and extension of fixed-term employment contracts are separately applied to each user undertaking. For example, if an employee signs more than two fixed-term employment contracts with a temporary agency worker for employment at the same user undertaking, the employment contract will be deemed to have been signed for an unspecified term from the start. In case the temporary agency worker is employed by different user undertakings under fixed-term employment contracts, the restrictions on consecutive entry into and extension of fixed-term employment contracts are applied separately to each user undertaking.

Prohibition of charging fees for the mediation of temporary agency workers

Pursuant to section 391 of the Labour Market Services and Benefits Act, an undertaking engaged in the mediation of temporary agency work is prohibited from charging a fee from a temporary agency worker for mediating the worker to a user undertaking for the performance of duties, or from a user undertaking for the signing of an employment contract.

An employer must ensure that the following working conditions apply to workers in Estonia: