Holiday pay in Finland: annual leave, lomaraha and holiday compensation

Karma Accounts · Published 19 October 2026

In Finland an employee earns 2 days of annual leave for each full holiday credit month between 1 April and 31 March, or 2.5 days once the employment has lasted at least a year by 31 March. Holiday pay (lomapalkka) is paid before the holiday starts: a monthly-paid employee keeps their normal salary, an hourly-paid employee gets their average daily pay times a coefficient, and someone working fewer than 14 days a month gets 9 % or 11.5 % of the year's pay. The holiday bonus (lomaraha) is not in the Annual Holidays Act at all; it is paid when a collective agreement or the employment contract provides for it.

The rules below are those of the Annual Holidays Act (vuosilomalaki 162/2005). A collective agreement may differ on several points, including how holiday pay is calculated and paid, so check yours first.

How annual leave accrues in Finland

Annual leave is counted in weekdays (arkipäivät): every day except Sundays, church holidays, Independence Day, Christmas Eve, Midsummer Eve, Easter Saturday and May Day. Saturdays count. The holiday credit year (lomanmääräytymisvuosi) runs from 1 April to 31 March.

Employment had lasted by 31 March	Leave for each full month
Less than a year	2 weekdays
At least a year	2.5 weekdays

A full holiday credit month is a calendar month with at least 14 days at work or days treated as equivalent to work. The contract decides which rule applies: if the employee is contracted to work so few days that no month, or only some months, reach 14 days, every month with at least 35 working hours, or equivalent hours, counts as full instead. If the year's total comes to a fraction, it is rounded up to a whole day.

Absences that count as time at work

Some absences are treated as days at work, among them:

sick leave and medical rehabilitation, up to 75 working days in a holiday credit year, or 75 working days per illness if the absence continues unbroken past 31 March
pregnancy and parental leave, up to 160 days per birth or adoption for each parent
lay-off, up to 30 working days at a time.

For an employee under the 35-hour rule, the same limits are periods of up to 182 calendar days for family leave, 105 for sickness and rehabilitation, and 42 for lay-off and study leave. If sickness or rehabilitation leaves a full year's holiday below 24 days, the employee is entitled to additional days off (lisävapaapäivät) to make up the difference, paid at their normal or average pay, unless the absence has lasted unbroken for over 12 months.

Twelve full months at 2.5 days give 30 weekdays, five weeks. Of that, 24 days are summer holiday, given in the holiday season from 2 May to 30 September, and the rest is winter holiday, given by the start of the next holiday season.

Employees outside both rules: time off and holiday compensation

An employee who by contract works under 14 days or 35 hours in every calendar month earns no holiday days. They have the right, if they ask, to two weekdays off for each calendar month of employment, and they receive holiday compensation (lomakorvaus): 9 % of the year's pay, without overtime and emergency work increases, or 11.5 % if the employment had lasted a year by 31 March. Pay lost to pregnancy, special pregnancy or parental leave is added to the base. The compensation is paid with the time off, or otherwise by the end of the holiday season.

How holiday pay is calculated

Which method applies depends on how the employee was paid when the holiday credit year ended on 31 March.

How the employee is paid	Holiday pay
Monthly or weekly salary	The normal salary continues during the holiday
Hourly or piece rate, at least 14 days a month	Average daily pay times a coefficient
Hourly or piece rate, under 14 days a month	9 % or 11.5 % of the year's pay

Monthly salary. The employee keeps their salary. Regular pay on top of it, such as a regular bonus, is added using the average daily pay method. If the working hours and the pay with them changed during the holiday credit year, the percentage method is used instead. If they change only after 31 March, before the holiday, the holiday pay follows the salary for the hours worked during the credit year.
Average daily pay (keskipäiväpalkka). The pay for time at work in the holiday credit year, without overtime and emergency work increases, divided by the days worked, with an eighth of the overtime hours added to the days. If the contract has more or fewer than five working days a week, the daily pay is multiplied by the weekly days and divided by five. The result is multiplied by a coefficient set in the Act: for example 18.3 for 20 holiday days, 22.2 for 24 and 27.8 for 30.
Percentage. 9 % of the year's pay for time at work, or 11.5 % once the employment has lasted a year by 31 March, again without overtime increases. Pay lost to certain absences, such as sick leave and family leave, is added to the base, up to the calendar-day limits above. This differs from the compensation in the previous section, where only pay lost to pregnancy, special pregnancy or parental leave is added.

Holiday pay is paid before the holiday begins; for a holiday of six days or less it may be paid on the normal payday, and a collective agreement may allow paying it with the normal pay. The employer gives a statement of how the amount was worked out and keeps a holiday record (vuosilomakirjanpito) for each employee.

Two examples

Aino starts on 1 June 2025 on a monthly salary of 3 000 euros. By 31 March 2026 she has 10 full months and less than a year of employment, so she earns 2 days a month: 20 days. She takes them in the summer of 2026 on her usual salary. At the end of the next holiday credit year, on 31 March 2027, her employment has lasted over a year, so twelve full months give her 30 days.

Ben is paid by the hour and works five days a week. In the holiday credit year he earned 26 400 euros for 220 working days, with no overtime: his average daily pay is 120 euros. For 24 holiday days his holiday pay is 22.2 × 120 = 2 664 euros.

Illness, saved leave and moving the holiday

If the employee is unable to work because of illness, an accident or childbirth when the holiday starts, the holiday is moved at their request. If the incapacity starts during the holiday, the sick days beyond the first six holiday days are moved at their request, but those six days may not cut their right to four weeks of holiday. The employee must ask without undue delay and, if the employer asks, give reliable evidence. Moved holiday that cannot be given even later is paid out as compensation.

The employer and employee may agree to save the part of the holiday above 18 days as saved leave (säästövapaa) for a later year, and the employee has the right to save the part above 24 days unless that seriously harms the work. They may also agree to take the part above 12 days within a year after the holiday season.

Holiday compensation when the employment ends

When the employment ends, holiday not yet taken or paid is paid out as holiday compensation (lomakorvaus). It is calculated under the holiday pay rules; for a monthly-paid employee one holiday day is the monthly salary divided by 25, or a weekly salary divided by 6. If Aino left on 31 March 2026 without taking her 20 days, she would get 20 × 120 = 2 400 euros. If the employment has lasted at least a year when it ends, the compensation for the current holiday credit year is counted at 2.5 days a month. An employee who earned no holiday days gets the 9 % or 11.5 % compensation.

Lomaraha comes from a collective agreement, not the law

The holiday bonus (lomaraha, also called lomaltapaluuraha) is not based on the Annual Holidays Act. It is an addition agreed in collective agreements, often 50 % of the holiday pay and usually paid with the summer holiday, and it can also be agreed in the employment contract. Whether you must pay it, how much, when and on what conditions depends on the agreement you follow.

If your sector has a generally applicable collective agreement (yleissitova työehtosopimus), you must follow at least its terms, its holiday bonus included, even if you belong to no employers' association. If no collective agreement applies and the contract says nothing about it, the Annual Holidays Act does not require one.

Reporting and tax on holiday pay

Holiday pay, holiday compensation and the holiday bonus are all wages. Tax is withheld from them under the employee's tax card, and the employer's social insurance contributions are paid on them as on the rest of the pay; the employer's health insurance contribution applies when the employee is covered by Finnish social security. The withheld tax and the health insurance contribution are paid in MyTax by the 12th of the month after the tax period, which is normally the payday month (with a quarterly tax period, by the 12th of the second month after the quarter); if the 12th is a weekend or public holiday, payment on the next business day is in time. What the contributions cost in 2026 is in our article on the costs of a first employee, and the pension part in our TyEL article for 2026.

In the Incomes Register (tulorekisteri) there is no separate income type for holiday pay: it is reported under the type of the pay it is based on, such as time-rate pay (201). The holiday bonus has its own type (213), and holiday compensation is reported as annual holiday compensation (234). Each payment is reported within five calendar days after the payment date; if the fifth day is a weekend or public holiday, the report can be made on the next business day.

The holiday pay liability at the year end

Holiday earned by the end of the financial year but not yet taken is a cost of that year. The Accounting Board (Kirjanpitolautakunta) took the view in its statements 1986/847 and 1991/1168, as quoted by its municipal division, that holiday pay and the social costs on it are booked on an accrual basis, in the period whose wages the holiday was earned on. The result is the holiday pay liability (lomapalkkavelka), shown under accrued liabilities (siirtovelat).

In practice it is calculated per employee: the unused days left from the previous holiday credit year and those earned since 1 April, valued at the employee's holiday pay, plus any holiday bonus already earned under a collective agreement or the employment contract, plus the employer contributions on those amounts. The year-end steps are in our article on closing the year.

What we do

We run payroll for small employers at 15 euros per payslip plus VAT 25.5 %, charged only in months with a pay date. The price covers the payslips, including the holiday pay paid on them, and we book the holiday pay liability in the accounts we keep for you. What else the payroll price includes is on our payroll services page and the price list.

Read what outsourcing payroll in Finland involves, or request a quote and tell us whether a collective agreement applies to your sector. If you are about to hire, our checklist for hiring your first employee goes through the steps in order.

Frequently asked questions

How is holiday pay calculated in Finland?

A monthly-paid employee keeps their salary during the holiday. An hourly-paid employee working at least 14 days a month gets average daily pay times a coefficient, and one working fewer days gets 9 % or 11.5 % of the year's pay, unless a collective agreement says otherwise.

How many days of annual leave does an employee get in Finland?

Two weekdays for each full month from 1 April to 31 March, or 2.5 once the employment has lasted a year by 31 March: 30 weekdays, five weeks, for a full year.

Is lomaraha mandatory in Finland?

Not under the Annual Holidays Act. You must pay it when a collective agreement that binds you, including a generally applicable one, or the employment contract provides for it.

What happens to unused holiday when employment ends in Finland?

It is paid out as holiday compensation. For a monthly-paid employee each unused day is the monthly salary divided by 25.

Sources

Please note: this is general information about Finnish rules, not advice for your own situation, and the rules change. Ask us before you act on it.

Payroll from the first hire

Payslips, the Incomes Register report within five days and the amounts to pay by the 12th worked out, for 15 € a payslip plus VAT. See payroll services.

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