The Finnish parental allowance system where Kela (Finnish social security institution) offers financial assistance to families will be reformed and the new Act will come to effect on 1 August 2022. Kela pay allowance starting from pregnancy leave and during various types of family leave. Family leaves are based on the Employment Contracts Act.
The reformed Act applies:
- if the estimated date of birth of the baby is on or after 4 September 2022.
- If you adopt and the child is taken into care on or after 31 July 2022.
Pregnancy leave and pregnancy allowance
One is entitled to start the pregnancy leave 30 working days (Monday to Saturday, with the exception of official holidays) before the expected due date of the child. The employee may agree with the employer to start the leave at a later point, but it has to be a minimum 14 working days prior to the due date. Pregnancy leave must be taken as a continuous period of full-time leave.
During the pregnancy leave Kela pays pregnancy allowance for 40 working days. Pregnancy allowance is about 90% of the employee's base salary.
Parental leave and parental allowance
The mother may continue to stay at home on a parental leave after the pregnancy leave has ended and starting from the day the child is born. For adopting parent(s), the parental leave can be taken from the day an adopted child is placed in care with the parent(s).
The maximum duration of parental leave is 320 working days (Monday to Saturday, with the exception of official holidays). Therefore each parent gets 160 days. It is also possible to transfer up to 63 days to the other parent. If agreed with the employer, it is also possible to be on part-time parental leave and work part-time (maximum five hours per day). Parental leave can be taken in 4 separate periods per parent, each period must be a minimum of 12 working days.
Parental allowance is paid by Kela for a maximum of 320 working days for one child and the allowance is paid from the parental leave days used per parent. The amount of parental allowance is based on the employee's annual income and the employee should check this with Kela. The parental allowance must be taken before the child turns 2 years old.
Child care leave
After the parental leave, one may take a child care leave until the child turns 3 years old. During the child care leave the parent receives child home care allowance from Kela.
A right to return to work after the family leave
When the employee returns to work after the family leave, the employee is entitled to come back to the same position that he/she had before. If such a position does not exist anymore, the employer must provide a similar position to the employee. If such a position is not available, the employer may consider termination of employment due to economical reasons.
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Please contact us to discuss how we can help you getting smooth and reliable accounting, payroll, legal and HR services for your business in Finland.
Tel. +358 10 756 4500