Nowadays, more and more employees are interested in an international career, and many Finnish companies operate globally. An employee may be enticed by the opportunity to move to a foreign branch of the same employer. What does this mean for the employer? And what if the employee is sent to a country where the employer does not have a business unit?
"We have branches all over the world, which allows us to understand local cultures and customers. One way to do this is by sending an employee from the home country, who is also valuable in the work culture of the destination country. Our goal is to be close to companies and learn from cultures on both sides," says an ICT service company.
Posted worker – employer’s responsibilities
1. Notification of posting workers:
- Sending an employee to work inside of the EU: For a work assignment to an EU, EEA, or social security agreement country, the employee needs an A1 certificate. This certificate shows that the employee remains under Finnish social security during the foreign assignment, and the company and employee avoid double insurance payments.
- Sending an employee to work outside of the EU: If the work assignment is to a third country, Kela (Social Insurance Institution of Finland) must be notified of the start and end of the work abroad.
2. Employee's social security
A person moving abroad from Finland usually loses their entitlement to Kela benefits if the stay abroad lasts more than 6 months. However, posted workers, civil servants, and development cooperation workers can retain their entitlement to Kela benefits for a longer period.
The entitlement to Kela benefits of a person leaving for local employment in another EU or EEA country or Switzerland usually ends when work in another country begins, regardless of the duration of the work. As of April 1, 2019, an employee posted outside the EU may be entitled to Kela benefits for up to 5 years.
3. International taxation
The employer must determine in which country the employee pays taxes and whether the salary is tax-free in Finland based on the so-called six-month rule. It is advisable to consult tax specialists on international taxation matters. FRS offers international tax advice with the help of its partners.
4. Employee's settling in a new country
When an employee moves abroad, practical arrangements related to the move and the adaptation of the employee and their family to the new country must also be taken care of. Difficulties in adapting for the employee or family members reflect on the workplace and can lead to the premature termination of the employment relationship. Relocation services support the employee and their family in the jungle of immigration and local registrations, as well as in settling into everyday life and adapting to the culture.
In international employment relationships, special attention must be paid to the specialist handling of work and residence permits to avoid business risks. FRS and our partners ensure the proper processing of permit matters worldwide.
It is also important to remember that conditions vary greatly between countries. Housing, schools, official formalities, and leisure opportunities vary significantly depending on the country. With our global network, we can offer comprehensive services in each target country.
Sending an employee to a country where the company does not have a business unit
If an employee is sent to a country where the employer does not have a branch, the EOR (Employer of Record) service can be utilized. The EOR service provider acts as the formal employer of the employee abroad and handles payroll administration, employee benefits, withholding taxes, and local employer reporting on behalf of the company. In practice, the employee works under your company's management and supervision in a similar way as in Finland.
FRS's parent company, Barona, operates as an EOR service provider in ten countries, and with the help of our partners, we can offer EOR services almost anywhere in the world.
Posted worker in Finland
An employee sent to Finland comes from another country to work in Finland either as a subcontract, internal transfer, or temporary work. In this case, the foreign company sending the employee to Finland must take care of the required notifications.
Finland Relocation Services provides relocation services for both those moving to Finland and those leaving Finland for abroad. Thanks to our extensive international network, we have partners in over 120 different countries so that we can assist smoothly with relocation anywhere in the world.