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New Corona-rule on sick pay in Estonia

Employers are liable from the second day of sickness; in return the period is shortened

From January 1 to April 30, 2021, Estonia will have exemption legislation according to which employees will receive continued payment of wages from the employer in the amount of 70% of their average wages (calculated on the basis of the previous six months’ wages) from the second to the fifth day of their illness. After that, continued payment of wages is borne by the state health insurance fund. As before, payments are made on the basis of a medical certificate.

Under the previous legislation, employees did not receive any payment during the first three days of illness, either from their employer or from the health insurance fund. They had to bear the consequences of absence from work themselves, unless the employer paid for it voluntarily. From the fourth day onwards, the employer paid for five days of sickness, and thereafter the health insurance started to pay for the remaining illness period.

Although a longer period was initially envisaged for this new regulation, it will now only apply for four months until April 30, 2021, after which the previous legal situation will come into force again.

This change affects Estonian companies and other employment relationships where Estonian labour law applies, such as in some cases of posting employees to Estonia.

The background to these changes is the impact of the Covid 19 pandemic. The intention of this regulation is to prevent employees from appearing at work despite symptoms of illness in order to avoid loss of wages. This is in contrast to the intent of the original regulations to avoid exploitation of such arrangements.

The regulation, under which the first three days of sick leave are not remunerated, has been in force since the economic crisis of 2008/2009 and was introduced at the time as a temporary measure to ease the burden on the state budget.

Source: Act on Amendments to the Occupational Health and Safety Act and Other Acts; RT I, 29.12.2020, 2

 

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