Being an employer

If you hire an employee, remember the employment contract, insurance policies and pay. Employers also have other statutory obligations – find out about them before recruitment

When you hire an employee, you become an employer, and this involves obligations. At the beginning of the employment relationship, an employment contract must be drawn up, the employee reported to the Incomes Register, and tax withholding and employer contributions paid. These include pension contributions, insurances, accident insurance and possibly occupational health care.

Recruitment is an important part of a successful employment relationship. Plan the recruitment process carefully, and remember that data protection legislation must be complied with already when processing applications. Personal information may only be collected to the necessary extent and must be stored carefully.

As an employer, you must comply with labour legislation and possibly with a sector-specific collective agreement (TES), which can determine, for example, minimum wages, working hours and holidays. Occupational safety and good orientation are not only the employee’s right but also your company’s interest.

Remember that indirect wage costs may be approximately 20–30% of the gross wage. Good planning helps avoid surprises.

You do not need to manage everything yourself: you can also buy competence from a subcontractor or from a light entrepreneur, and in this case, the obligations related to the employment relationship do not apply. However, the need for a clear agreement is emphasised.