New employment register

Estonia: As of 1 July 2014 all employment must be registered at the Estonian Tax and Customs Board.

On 1 July 2014 amendments to the Estonian Taxation Act came into force. These require that all persons whose activities can be considered as working in the broadest sense must be registered at the Estonian Tax and Customs Board.

The new rules simplify communication between employers and state authorities: the new register is used by all authorities, which previously each received different kinds of information separately from employers, for example the national Health Insurance Fund, the Unemployment Insurance Fund, the Social Insurance Board and the tax authority. Additionally employees can check if they have been properly registered and if all taxes have been declared and paid for them. This makes the relationship between state, employer and employee simpler and more transparent. Another reason for imposing the obligation to register employment was to avoid illicit work, especially in the construction sector.

Employment must be registered by the employer before factual commencement of work. In this context, natural persons may also be regarded as employers (there are some exceptions for certain NGOs). Under the Act, board members and managers must also be registered if they receive remuneration for their activities (if tax liability arises in Estonia). Employment registration must also be recorded in the employment register for those who work only for a few hours (e.g. giving a lecture or conducting training). Additionally, work by volunteers and trainees who receive no remuneration has to be recorded.

Employment registration is carried out using Estonian personal identification numbers. Someone who is in Estonia only for a short period can register employment for up to five days using their name and birth date.

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