Hiring an employee
Where to start when hiring your first employee? What is the income register and how to agree on a probationary period? Get these tips when you hire for the first time.
Contents
Employer register
An employer is considered either an occasional or regular employer for tax purposes. The registration status of a company affects its reporting obligations, for example: to the Incomes Register.
Registering as an employer:
- As a regular employer A company operating in Finland must always register with the employer register. You must also file reports with the Incomes Register.
- As a casual employer, i.e. if you hire a casual employee, pay wages casually or employ only one permanent employee, you do not need to register with the employer register. You do not need to file reports with the Incomes Register if you do not pay wages.
Regular employer
If you are a regular employer and are included in the employer register, you must also submit a notification to the Incomes Register for months in which wages are not paid. This information is reported in a separate notification.
Your company is a regular employer when:
- Your company regularly pays salaries to two or more employees
- Your company pays a regular salary to one employee and also to one or more employees whose employment is temporary or intended to be short-term.
- Your company pays salaries to at least six employees at the same time, even if their employment relationships are temporary and intended to be short-term.
Casual employer
If you hire, for example, a casual employee or only pay wages occasionally, you do not need to register with the employer register.
Your company is a casual employer when:
- Your company only has one permanent employee
- Your company employs one to five employees whose employment relationship does not last the entire calendar year.
You do not need to submit notifications to the Incomes Register if your company is not included in the employer register and you do not pay wages or other comparable payments.
Frequently asked questions about hiring
In addition to salary, a new employee also incurs other costs, such as salary-related expenses, recruitment costs, and orientation costs.
If certain conditions are met, you can receive financial support for hiring an employee if you do so with a wage subsidy or through apprenticeship training.
Whether you are looking for new employees through a job posting or through your networks, there are several things to consider when recruiting. Successful recruitment goes a long way and the costs of recruitment pay off. Learn how to start recruiting and what to consider in the process.
Recruitment and orientation | Yrittajat.fi
An employment contract serves as the basis for an employment relationship. We have compiled what you should consider when drawing up an employment contract, as well as information about other agreements you can make with an employee.
Employment contract and other employer agreements | Yrittajat.fi
Are you still deciding between hiring an employee and leasing labor? Read more about leasing labor and subcontracting.
Income register
The Incomes Register is an electronic information service maintained by the Tax Administration, where information on salaries, pensions and benefits is entered for the needs of the authorities.
The information is reported to the Incomes Register within five days after each payment transaction and per income earner. The employer must provide the Incomes Register with information on the wages paid in a salary information return, regardless of whether the company is included in the employer register or not. In addition, the employer's health insurance contributions must be reported to the Incomes Register in a separate employer return.
Each employer decides for themselves how extensively they want to report information to the Incomes Register or whether to report only the mandatory information. From the employer's perspective, it may be most appropriate to provide as comprehensive information as possible when paying wages, as this reduces the amount of investigation work that needs to be done afterwards. The employer should assess what is the best solution for their own company.
Income register in a nutshell
- As an employer, you must report the wages paid to the Incomes Register, even if you are not included in the employer register.
- If you are a regular employer, you must also notify the Incomes Register of the months in which you do not pay wages.
- You can only report mandatory information to the register in accordance with the minimum requirements, or more thoroughly, which reduces the potential investigation work to be done afterwards.
Quick guide to the Incomes Register for entrepreneurs
We have compiled the most important information for entrepreneurs regarding the Incomes Register. Check out the free guide!
Voluntary information in the Incomes Register, or so-called supplementary information, is information that is needed for, among other things, benefit decisions, determining customer fees and processing claims.
Benefits applied for by the employer naturally burden the employer directly, while benefits applied for by the employee burden the employer indirectly, when the employee requests a pay slip from the employer if necessary or the benefit provider requests additional information. When the employer provides additional information immediately upon payment of the salary, retrospective and manual investigation work is reduced.
The most recommended and easiest way is to transmit salary information to the Incomes Register via a technical interface. This means that an electronic connection has been built between the payroll system and the Incomes Register, allowing the information to be transmitted reliably and automatically between the two systems. This reduces the number of manual work steps. If you want to automate the reporting of salary information, make sure that a technical interface has been built from the payroll system to the Incomes Register.
You can get more information about the technical interface from, for example, accounting firms and From the tax administration.
Electronic transactions are a basic requirement of the Incomes Register. Information can only be reported on a paper form for a special reason. A special reason could be, for example, situations where a natural person, an estate, a casual employer or a foreigner would not have the possibility of providing information electronically. Information cannot be reported to the Incomes Register by telephone, but must be reported in a prescribed format.
You can learn more about electronic payroll calculation and reporting in the free course aimed specifically at small businesses and households. palkka.fi service, which is a statutory authority service. The Palkka.fi service makes it possible to calculate companies' salaries and report the information directly to the Incomes Register.
The Tax Administration will impose a default fee on the person obliged to report if:
- the notification is incomplete or contains errors and
- the notification has not been corrected despite the request, or
- An acceptable explanation for the failure to report has not been provided within the specified time limit.
The Tax Administration may not impose a default fee, or it may be reduced if there is a justified reason for the default. The default fee is 100–1000 euros, depending on the number of incorrect or incomplete declarations.
Read more about the negligence fee in the Tax Administration's instructions.
Probation
A probationary period is a period at the beginning of an employment relationship that gives the employer and employee the right to terminate the employment contract immediately during the probationary period without any specific grounds for termination. However, termination may not be based on unfair or discriminatory grounds.
A probationary period can be agreed upon in both an open-ended and a fixed-term employment contract:
- In an employment contract that is valid for the time being, the probationary period may, according to the Employment Contracts Act, be a maximum of six months. If the employee has been absent from work during the probationary period due to disability or family leave, the employer has the right to extend the probationary period. The probationary period may be extended by one month for every 30 calendar days of absence.
- In a fixed-term employment contract, the probationary period, including extensions, may not exceed half of the duration of the employment contract, but not more than six months.
The employer and employee agree on a probationary period, and if a probationary period is agreed upon, it must be recorded in the employment contract.
Probationary period and fixed-term employment
In successive fixed-term employment contracts, a new probationary period cannot be agreed if the employee's duties have not substantially changed. A probationary period can be agreed if the employee's duties clearly change from the previous employment contract.
If an employee's job duties change significantly during the employment relationship, the employer and employee may agree that a probationary period begins in connection with the change. The employee will then return to their previous position if the employer decides to terminate the employment contract during the probationary period agreed upon in connection with the change in position.
Frequently asked questions about probation
A probationary period is a period of consideration agreed upon by the employee and the employer at the beginning of the employment relationship. During the probationary period, the employer can terminate the employment contract on less serious grounds, as long as the grounds for termination are not discriminatory. The probationary period must always be agreed upon separately in the employment contract.
The maximum duration of the probationary period is six months. The employer and employee are free to agree on a shorter probationary period.
The employer and employee can freely agree in the employment contract to use a probationary period at the start of the employment relationship, as long as its duration is a maximum of six months. The probationary period allows both parties the opportunity to terminate the employment contract on more flexible terms and without notice if the employment relationship does not meet expectations.
An employee can terminate an employment contract during a probationary period. In this case, the employee does not have a notice period, but the employment relationship ends immediately.
The employer may extend the probationary period under certain conditions. If the employee has been absent from work during the probationary period due to disability or family leave, the employer has the right to extend the probationary period. The probationary period may be extended by one month for every 30 calendar days. The employer must inform the employee if the employer wants to extend the probationary period due to absences.
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Probationary period extension
Extending the probationary period means extending the probationary period after the employee returns to work by the same number of months as the employee was absent from work due to illness or family leave.
The employer has the right to extend the probationary period by one month each period of disability or family leave included Per 30 calendar daysif the employee has been absent from work during the probationary period due to disability or family leave.
What to consider:
- Calendar days do not have to be accumulated from a single period of absence. Days of absence due to disability or family leave are added together.
- Days on which the employee has worked regardless of disability or family leave are not taken into account.
- The employer must always notify the employee of the extension of the probationary period before the end of the probationary period, as the probationary period is not extended automatically.
When calculating calendar days, all calendar days included in the disability or family leave period are taken into account, including holidays.
The employer has the option to extend the probationary period only based on calendar days included in the disability or family leave period that: are subject to probation.
Example of completing 30 calendar days
The probationary period began on 15 February 2025 and ends on 14 August 2025. The employee has been absent from work due to illness for 29 calendar days during the probationary period. The employer does not have the right to extend the probationary period. If the employee has been absent for 30 calendar days, the employer has the right to extend the probationary period by one month until 14 September 2025. In this case, the employer must notify the employee no later than 14 August 2025.
Example of calculating calendar days
An employee works a five-day week. He is absent from work between Thursday and Tuesday due to illness and returns to work on Wednesday. This amounts to six calendar days. If the employee were absent from Monday to Friday, i.e. “the whole week”, returning to work the following Monday, this would amount to seven calendar days.
Example of absences partially on probation
The probationary period began on 15 February 2025 and ends on 14 August 2025. The employee has been absent from work due to disability from 20 July to 21 August 2025, i.e. a total of 33 days. However, since only 27 calendar days of the disability period are allocated to the probationary period, the employer does not have the right to extend the probationary period.
Longer absences during the probationary period
The probationary period can only be extended if the employee has been absent due to disability or family leave for at least 30 calendar days during the originally agreed probationary period. If another 30 calendar days are accumulated during the employee's disability or family leave periods, the probationary period can be extended again.
In the event of longer absences, the employer will notify the employee of the extension of the probationary period, taking into account the estimated duration of the absence. If the employee returns from family leave earlier than announced, this must be taken into account when determining the end of the probationary period.
Example of extending the probationary period after the first 30 days
The probationary period began on 15 February 2025 and ends on 14 August 2025. The employee has been absent from work due to illness for 58 calendar days during the probationary period. Since the 30 calendar days have been reached, the employer has the right to extend the probationary period by one month until 14 September 2025 by notifying the employee of this no later than 14 August 2025.
The employee's incapacity for work will continue for two more calendar days (58 + 2) during the "extended probationary period". As another 30 calendar days are completed, the employer has the right to extend the probationary period by one month until 14 October 2025 by notifying the employee no later than 14 September 2025.
Example of extending the probationary period for longer absences
The probationary period has started on 1 January 2025 and will end on 30 June 2025. The employee announces that he will be on family leave from 30 March 2025 until 30 January 2026 (approximately 10 months). The above-mentioned period includes ten full periods of 30 calendar days. Therefore, the employer has the right to extend the probationary period by ten months until 30 April 2026. The employee must be notified of this no later than 30 June 2025, i.e. before the end of the original probationary period.
