The length of the pay subsidy period depends on factors such as the duration of the person’s unemployment and the impact of reduced work ability on their work performance:

• The subsidy is usually granted for five or ten months. The period depends on how long the job seeker has been unemployed before the pay subsidy period.  
• The subsidy may be granted for a maximum of 24 months at a time if the job seeker has been unemployed for 12 months in the last 14 months and is aged 60 or over.  
• If you are employing a person with reduced work ability, the subsidy may be initially granted for 10 months. After this, the subsidy may be granted for a maximum of 24 months at a time, provided that the criteria for continuation are met. Applications must be submitted before the end of the previous subsidy period. For more information, see Pay subsidy for hiring a person with reduced work ability. 
• Pay subsidy for apprenticeship may be granted for the entire duration of the apprenticeship. 

To be eligible for pay subsidy, the employer must not have materially neglected its obligation to pay wages or obligations to pay taxes or statutory fees. 
The number of employees must not have decreased in the last 12 months due to productive or financial dismissals. 

As an employer, you commit to paying the employee supported by pay subsidy in accordance with the collective agreement, or a normal and reasonable wage if there is no applicable collective agreement.

A pay subsidy is a subsidy intended to promote the employment of an unemployed job seeker, which the Employment and Economic Development Office may grant to the employer for payroll costs. The purpose of work supported by pay subsidy is to promote the employment of unemployed job seekers in the open labour market by improving their professional competence. Work supported by pay subsidy also helps people with reduced work ability and those aged 60 or over who have been unemployed for an extended period to find employment and participate in the world of work.  

The person to be hired with the subsidy must be an unemployed job seeker when the pay subsidy is granted. This means that they must be active job seekers at the TE Office or local government pilot and that they must not be employed, a full-time student or an entrepreneur. Those who have been completely laid off or work less than four hours a week are also considered unemployed and may be hired with a pay subsidy.

When granting a pay subsidy for improving professional competence, the subsidy is 50 per cent, but no more than EUR 1,260 per month. If the person to be hired with the subsidy has been unemployed for less than a year, the pay subsidy may be granted for five months. If they have been unemployed for at least 12 months in the previous 14 months, the pay subsidy may be granted for 10 months. The pay subsidy is targeted at people in a disadvantaged position in the labour market, which is why the person to be hired with the subsidy must belong to one of the target groups of the pay subsidy: 

• between the ages of 15 and 24;
• aged 50 or over; 
• has not completed a matriculation examination, a qualification referred to in the Act on Vocational Education and Training or a comparable foreign upper secondary qualification; 
• is entitled to an integration plan referred to in the Act on the Promotion of Immigrant Integration; or 
• has not been in gainful employment in the previous six months. 

Belonging to any one of these target groups is enough. Pay subsidy for apprenticeship may also be granted to persons outside these target groups if deemed appropriate. The TE Office will also estimate whether the person to be hired with the subsidy has a lack of vocational skills applicable to the position applied for. As an exception, the pay-subsidised employment of persons with reduced work ability or aged 60 or over who have been unemployed for an extended period does not require a lack of vocational skills. 

A subsidy covering 70 per cent of the payroll costs, but no more than EUR 1,770 per month, may be granted for employing a person with reduced work ability if the unemployed job seeker’s opportunities to find suitable work have significantly decreased due to a disability or illness. The person to be hired with the subsidy must submit a medical certificate of their work ability to the TE Office or the local government pilot on employment.

Pay subsidy for hiring a person with reduced work ability may be granted for 10 months. Later, the subsidy may be extended for up to 24 months at a time if the following conditions are met: 

• the person to be hired with the subsidy has submitted a medical certificate prepared during the pay subsidy period to the TE Office or the local government pilot on employment; 
• the employer has implemented the reasonable adjustments recommended by occupational health care; 
• according to the estimate of the TE Office or the local government pilot on employment, productivity in the position is decreased significantly due to a disability or illness, permanently or in a permanent manner, despite the adjustments made; 
• the extension application has been submitted well before the end of the granted subsidy period; 
• the employer meets the general conditions for granting a pay subsidy. 

A subsidy covering 70 per cent of the payroll costs, but no more than EUR 1,770 per month, may be granted for employing a long-term unemployed person aged 55 or over.  

Employment subsidy for a person aged 55 or over will be granted for 10 months or up to the duration of the employment relationship. To be eligible for the subsidy, the person to be hired with the subsidy must have reached the age of 55 before the subsidy is granted, and they must have been unemployed for 24 months in the 28 months before the employment subsidy is granted. (Please note that you must apply for employment subsidy with an application separate from the pay subsidy.) 

Employment subsidy may also be granted for part-time employment, but the employee must work at least 25 hours a week or at least 65 per cent of the maximum regular working hours in the sector.

If the person to be hired with the subsidy has reached the age of 60 and has been unemployed for 12 months in the 14 months immediately before the pay subsidy is granted, a subsidy may be granted for 24 months at a time.

This subsidy is applied for with a pay subsidy application; select the application criterion “The subsidy is applied for the promotion of the employment of a person aged 60 or over who has been unemployed for an extended period.”

An extension application for a new 24-month period must be submitted before the end of the previous subsidy period.

For financial activities, this subsidy is granted as de minimis aid.

Organisations, foundations and registered religious communities may receive 100 per cent pay subsidy when they employ a long-term unemployed person. To be eligible for the employment subsidy, the person to be hired with the subsidy must have been unemployed for 24 months in the 28 months immediately before the pay subsidy is granted.

Full support, i.e., 100 per cent, is paid up to a maximum of 65 per cent of full working hours. The employer may hire an employee for full-time employment, but the employer must then cover the payroll costs for working hours exceeding 65 per cent. The subsidy is granted for 10 months, but no longer than the duration of the employment relationship.

The pay subsidy is paid based on the gross salary, and unlike the other forms of pay subsidy, the amount of the 100 per cent pay subsidy is calculated with an increase to compensate for indirect costs. The coefficient used for the calculation is 1.23. A maximum of EUR 2,020 per month may be paid.

Full or 100 per cent subsidy may also be granted to an organisation, foundation or registered religious community engaged in business activities. In these cases, the subsidy is paid as de minimis aid.

In addition to the pay subsidy, you can familiarise yourself with your opportunities for receiving a municipal supplement for hiring a job seeker.
A municipal supplement may be granted for covering payroll costs in addition to the pay subsidy and for recruitment costs depending on municipality. In this case, the employer may use it to cover the guidance and orientation costs at the beginning of the employment relationship or purchase the tools and clothing needed for the new employment relationship. The criteria for granting a municipal supplement vary by municipality. Check the criteria for granting and apply for a municipal supplement to the employee’s municipality of residence.