Labour market

Considerations for the investor:

  • The new Employment Contract Law with significant changes became effective from 1 July 2009.
  • Trade unions and employers generally have a cooperative relationship; it is unusual in Estonia to strike.
  • Social security contributions (33%) calculated from the gross employment income are payable by the employer.
  • Employees do not pay social tax.
  • Citizens of the European Union, European Economic Area and Switzerland do not need a separate permit to work in Estonia.
  • A foreigner may work in Estonia as a member of the management body of a legal entity registered in Estonia, in order to fulfill management and supervision functions, for up to six months a year without a work permit or a residence permit for the purpose of employment, and without being registered with the Police- and Border Guard Board under short-term employment provided they have a legal basis for residing in Estonia.


Estonia's population of working age is just below one million, with approximately 600 thousand in employment. There are more than 350 thousand inactive people. The term inactive covers people who do not wish to or are not able to work (source: www.stat.ee).

Based on recent surveys the unemployment rate has increased substantially within the last year (according to the statistics of the Estonian Unemployment Insurance Fund there are officially 92 thousand people registered as unemployed as at 30 December 2009) and it is likely that in the light of the recent convulsions in the world economy, the rate will continue to increase.

Unemployment (ILO): 5.5% (2008)
14.6% (2009)
Average wage: 725 EUR (2007)
820 EUR (2008)
770 EUR (2009 Iq)
Real wage growth: 2007 - 12.0%
2008 - 4.3%
2009 - - 4.3%
Working time: 8 hour per day
5 days per week
Age of retirement: 63 (both men and women), 65 starting 2017
General vacation: 28 calendar-days

More Information about the Labour Market: