Insurance while working abroad

Employers also insure their employees who are working abroad. The process of insuring is affected by the country in which the employee will be working (the receiving country) and the duration of the employment relationship. When Finnish employees work abroad, they are usually covered by the social security of the receiving country. They are insured in accordance with the regulations of that country and their pension accrues in accordance with that country’s legislation.

One exception to this rule concerns employees who are working abroad on a temporary basis, also known as posted workers. In these cases, the legislation of the posting country is applicable to the employees throughout their posting.

A posted worker is an employee who

  • Is posted by an employer based in Finland for the entire work assignment
  • Falls within the sphere of the Finnish social security scheme at the time when the posting begins
  • Is working abroad on a temporary basis.

Work in an EU/EEA country, Switzerland or a country with which Finland has signed a social security agreement

When an employer posts an employee to work temporarily in an EU/EEA country, Switzerland or a country with which Finland has a social security agreement, the employee may, on certain terms, remain within the Finnish social security scheme. Usually, a posted worker has the possibility to remain insured in Finland for a maximum of two years. In this case, the employee will need an A1 certificate issued by the Finnish Centre for Pensions as proof of the right to be covered by Finnish social security. If necessary, the employee can present this certificate to authorities in the receiving country or to the company responsible for paying the employee’s salary. The employer or employee can apply for the posted worker certificate from the website of the Finnish Centre for Pensions.

If the work assignment lasts less than one month, the assignment is often considered as a work trip and there is no need to apply for the A1 certificate.

The countries with which Finland has signed a social security agreement include Australia, Chile, South Korea, India, Israel, China, Canada, Quebec and the USA.

Long-term postings

The EU Regulation on the coordination of social security systems as well as the social security agreements Finland has signed with different countries define the length of a work assignment that is to be considered temporary.

If a work assignment abroad continues for more than two years, the employee can apply for a three-year exemption in order to remain within the sphere of the Finnish social security scheme. The exemption must, however, be accepted by the receiving country. The exemption is applied for using the same method as for the A1 certificate for posted workers. If the work assignment lasts longer than five years, the responsibility for pension security and other forms of social security is transferred to the receiving country. The insurance is then managed in accordance with the practices of the country in question.

Employees who are permanently working abroad are generally insured within the country in which they are working.

Employees working in two or more countries

If an employee is working in two or more EU/EEA countries or Switzerland, that employee is generally insured in accordance with the legislation valid in the employee’s country of residence. One condition for this is that a significant part (25%) of the work is carried out within the country of residence. Otherwise, the employee is usually insured in the employer’s home country. This practice applies to, among others, travelling personnel employed by a transport company operating within an EU country.

Work outside of the EU/EEA countries and countries with which Finland has a social security agreement

In terms of assignments in countries that are not EU/EEA countries or countries with which Finland has a social security agreement, the employees are insured in accordance with the laws of both Finland and the receiving country, without any time limitations. Since no agreement exists, the receiving country may also collect insurance contributions from the employee.

An employee must be insured in accordance with TyEL if

  • The employer is Finnish
  • The employee has been posted from Finland
  • The employment relationship with the posting employer will continue throughout the foreign assignment and
  • The employee is covered by the Finnish social security scheme when the work assignment begins.

If the assignment takes place in a non-agreement country, the Finnish Centre for Pensions does not issue a certificate for coverage under Finnish social security laws. In this case, the employee should contact Kela.

The employer can apply for exemption from the obligation to insure the employee under TyEL if the work assignment lasts more than two years. In order to be granted exemption, however, the employer must arrange some form of pension coverage that is equivalent to the level of coverage stipulated by the Employees Pensions Act (TyEL). This exemption is granted by the Finnish Centre for Pensions.

You can find more information about the application for pension from foreign countries on our pension site.

Foreign employees in Finland

The basic principle is that any work done in Finland is insured in Finland. A foreign employee is insured by TyEL insurance just like Finnish employees. One exception is a posted worker from an EU or EEA country, Switzerland or a country with which Finland has a social security agreement. These posted workers shall have an A1 certificate from the sending country which states that the worker is insured in the sending country throughout the entire assignment in Finland.

Employment pension is paid from Finland to foreign workers in any country. Pension insurance contributions are not returned once a worker leaves Finland, but are paid back during retirement in the form of pension.