How much is holiday pay

  • As a rule, the employee is paid his or her normal pay during the leave, i.e. the salary the employee has at the beginning of the leave.
  • In addition to salary, the employee maintains full rights to any fringe benefits also during the annual leave. Thus the employee has the right to use, for example, his or her company phone or company car while on leave.
  • Luncheon vouchers may be given to employees only for their actual working days so the employer does not have to give them during annual holidays. In these cases the employer adds the tax value of the meal benefit to the employee’s holiday pay. If the employee is given luncheon vouchers during his or her annual leave, they will be considered in their nominal value in taxation, instead of their tax value.
  • Holiday pay shall be paid before the beginning of the leave. It may be paid on the normal payment day if the length of the leave does not exceed six working days.
  • At termination of the employment relationship, untaken leave is reimbursed by holiday compensation. Holiday compensation corresponds to the holiday pay the person would have received, had he or she taken leave.

Holiday bonus

  • Holiday bonus is usually agreed upon in collective agreements.
  • Payment of any holiday bonuses is not statutory but based on collective agreements or civil servants’ collective agreements, local contracts or the employee’s personal employment contract.
  • The amount and determination grounds for holiday bonus vary between different collective agreements but usually it is 50% of the holiday pay paid out in money.
  • In many workplaces where no collective agreement is applied and thus no holiday bonus provisions apply, the employees still receive holiday bonuses.
  • If no collective agreement applies, the employee should always make sure that provisions on holiday bonus are included in the employment contract in order to avoid misinterpretations.