Estonians with no work permits may start coming to Finland to work immediately after the country joins the European Union on May 1st, even though Finland plans to limit the arrival of labour from the new member states during a transition period of two years.

   

This situation is made possible by a loophole in the legislation on the transition period, which is currently being processed in Parliament.

   

The free mobility of services will affect the new member states from the very beginning. Firms that recruit employees through labour rental agencies can thus circumvent the restrictions.

   

In practice, a Finnish employer can hire an Estonian employee through an Estonian staffing service company. In this case, the job contract is made between the Estonian parties. The employees avoid work permit bureaucracy, but pay their taxes and social security payments in Estonia.

The wages are paid by the staffing service company

according to the terms of Finnish collective labour agreements, but it will be extremely difficult to monitor how much the employee actually pockets.

   

Also, as no comprehensive register of the foreigners working in Finland through such arrangements will be available, the Finnish authorities will not be able to keep an eye on their working conditions.

   

There are already temp agencies in Estonia that offer their services to Finnish companies as well, and several Finnish companies have opened offices in Estonia.