How are the wages, holiday pay and holiday bonus paid?

The wages (the pay) is what your employer pays you when you work for them. The worker and the employer agree the wages and other things in the employment contract. The contract should always be made in writing.

There are no laws in Finland that say how much your wages should be. Minimum wages are agreed in the collective agreements between a trade union (for example PAM) and the employer organisation. You can not agree with the company to work for less than the minimum wage. You can always agree to get better wages.

Your own sector’s collective agreement says how much you should be paid. To see the minimum wage for the Commercial sector and the Hotel and Restaurant industry, you can also use the PAM calculator (in Finnish).

Basic wages and different types of extra pay

Your wages have different parts: the basic wages and different types of extra pay. Your basic wages may be monthly or hourly wages, or you may get piecework pay (urakkapalkka). You may get extra pay for work that you do in the evening or on religious holidays, or for overtime work. The extra pay is different in different sectors.

Holiday pay, holiday bonus and holiday compensation

You get holiday pay during your annual holiday. You do not usually get any other wages during the holiday. Most of the collective agreements have rules about how to count your holiday pay, and when you get your holiday pay. Read more in your sector’s collective agreement.

Holiday bonuses (lomaraha or lomaltapaluuraha) are additional benefits that workers get based on the collective agreement. The Finnish term for holiday bonus is different in different collective agreements: lomaraha or lomaltapaluuraha. The holiday bonus is 50% of the holiday pay for the holiday that the worker has earned (2 or 2.5 days per month). You can only get the holiday bonus if you begin the holiday on the agreed time, and return from the holiday immediately after the holiday ends.

If you work part-time (so little that you get no holiday days) or you have holiday days that you can not take for some reason, your employer will pay you holiday compensation. Holiday compensation (lomakorvaus) is money that you get as compensation for not getting any holiday.

When you get holiday pay or holiday compensation, your employer must give you a calculation sheet that shows how much holiday pay or holiday compensation you get, and how they are calculated.

Read more: Changing your holiday bonus into free time.

Final wages (Loppupalkka)

Final wages must be paid on the day when your work ends, unless you have agreed something else in the employment contract. The collective agreement may also have rules about the payment day. For example, sometimes the worker and the employer may agree that final wages are paid on the next normal pay day after the work ends.

When you get the final wages, you also get all other payments such as any holiday compensation or bonuses. 

If you don’t get the final wages on the right day, you have the right to get interest on overdue payment (viivästyskorko) and full wages for a maximum of six calendar days when you wait for your wages. Interest on overdue payment is set out in the Interest Act (Korkolaki).

If it is not clear how much your employer should pay you, or the delay is because the pay has been calculated wrong or some other mistake has been made, you only have the right to get paid wages for the days you wait if you have told the employer about the delay less than one month after the work relationship has ended. The employer must then pay your final wages within three weekdays. Your right to wages for the days you wait only begins after this period.

Wages for young people and summer workers

For summer jobs and other short periods of employment, the collective agreement and its terms and conditions must be followed. 

Collective agreements say that even if a young worker only has a summer job, he or she gets wages based on experience and the training or education that they have for the work.

Read more about wages for young workers.

Wages and earnings in statistics

Wages and earnings are defined differently in statistics. What is the difference? Chief Economist Antti Koskela from PAM tells more in this video (in Finnish).

Wages (palkka) usually only mean the basic wages. Earnings (ansiot) are your wages plus all the extra pay for difficult working conditions, special times that you have worked, and commissions, but not overtime. Earnings are often higher than your wages.

In everyday language, wages and earnings often mean the same thing, but you should know the difference. It’s important when you look at statistics and see how much you can get paid in different jobs.

Chief Economist Antti Koskela from PAM tells more in this video (in Finnish)

Read more:

• How to read your payslip
• Changing your holiday bonus (lomaraha or lomaltapaluuraha) into free time