Business · payroll costs 2026
Cost of an employee 2026 — employer’s on-costs in Finland
An employee costs the employer more than just the gross salary: statutory on-costs are added on top — TyEL (17.10%), health insurance (1.91%), unemployment insurance (0.31% / 1.23%), accident insurance (~0.51%) and group life insurance (0.06%). In practice the multiplier is about 1.2 without the holiday bonus and about 1.3–1.35 with it (lomaraha).
The calculator shows the real monthly cost of an employee, a breakdown by contribution, and how much the employee actually takes home — the full wedge between gross and net pay. You can compare up to three employees and see the total payroll.
Cost of an employee
The holiday bonus is typically ~50% of holiday pay, about 12.5% of the annual salary. It depends on the collective agreement.
Real cost to the employer
€3,597€/month
€43,160 €/year · gross × 1.199
| Gross salary | €3,000 |
| TyEL (employer 17.10%) | €513 |
| Health insurance (1.91%) | €57 |
| Unemployment insurance | €9 |
| Accident insurance (~0.51%) | €15 |
| Group life insurance (0.06%) | €2 |
| Total / month | €3,597 |
Where the money goes
The employee’s net pay is calculated using the national-average municipal tax rate (no church tax). Actual net depends on the municipality and personal deductions.
The figures are average statutory 2026 contributions. TyEL 17.10% is an average — the real rate is set by the insurer. Accident insurance varies by industry risk (0.05–5.00%). Group life insurance is charged only if the collective agreement requires it. The calculator is indicative, for budgeting.
How much does an employee cost an employer in Finland in 2026?
The real cost of an employee is the gross salary plus the employer’s statutory on-costs. In 2026 these are: the TyEL pension contribution (employer share averaging 17.10%), the health insurance contribution 1.91%, the unemployment insurance contribution 0.31% (small employer) or 1.23% (large, payroll over €2,509,500), accident insurance averaging about 0.51%, and group life insurance 0.06%. Together the on-costs are about 20% on top of gross, i.e. a multiplier of about 1.2. Including the holiday bonus (about 12.5% of the annual salary) the multiplier rises to about 1.3–1.35. For example, a gross salary of €3,000 costs the employer about €3,597 a month without the holiday bonus. Meanwhile the employee takes home about €2,379 — the difference is taxes and mandatory contributions that fund pensions and social security.
What employer on-costs consist of
The largest item is the TyEL pension contribution, on average 17.10% of pay (the employer’s share; the employee also has their own share of 7.15%, or 8.65% for those aged 53–62, withheld). Health insurance is 1.91% and the unemployment insurance contribution is tiered: 0.31% at smaller payrolls and 1.23% at larger ones. On top come accident and occupational-disease insurance (about 0.51% depending on the sector) and group life insurance (0.06%).
For a €3,000 gross salary, for example, the employer’s total cost is about €3,600 a month without the holiday bonus. Once the holiday bonus and holiday pay are included, the multiplier often rises to around 1.3. The employee takes home clearly less than the gross, because withholding tax and the employee’s own contributions are deducted from pay — this gap is called the tax wedge.
Frequently asked questions
How much does an employee cost the employer in 2026?
About 20% of statutory on-costs are added on top of the gross: TyEL 17.10%, health insurance 1.91%, unemployment 0.31%/1.23%, accident insurance ~0.51% and group life 0.06%. The multiplier is about 1.2, or 1.3–1.35 with the holiday bonus.
What is the TyEL contribution in 2026?
The employer’s average TyEL share is 17.10% of pay. The employee also has their own share of 7.15% (or 8.65% for those aged 53–62) withheld, which shows in net pay.
Is the holiday bonus included in the cost?
Statutory on-costs are calculated on the pay actually paid. The holiday bonus and holiday pay increase the yearly cost, which is why the real multiplier often rises to around 1.3.
What is the tax wedge?
The gap between the employer’s total cost and the net pay the employee takes home. It includes the employer’s on-costs, the employee’s own contributions and withholding tax.
Are on-costs the same for all employers?
Mostly yes, but accident insurance varies with the sector’s risk and the unemployment contribution is tiered by payroll size (0.31% / 1.23%). The calculator’s estimates use the general 2026 rates.