Homepage / News / Working relations

Working relations

New restrictions and amendments to the employment contract.


The Government of the Republic of Estonia has established additional restrictions effective as of 11 March 2021. More detailed information on the restrictions can be found on the website

The restrictions affect the economic activities of many companies and thus their employment relationships. Below we outline the opportunities for continuing employment relationship arising from the Employment Contracts Act (ECA). We remind employers and employees that the most important thing in this case is to negotiate openly and find a solution that suits both parties. Negotiations and communication help to maintain companies and employment relations for as long as possible. 

First of all, a reduction in wages on the basis of subsection 37 (1) of the Employment Contracts Act (ECA) could be considered. Subsection 37 (1) of the Employment Contracts Act provides that, if an employer, due to unforeseen economic circumstances beyond its control, fails to provide an employee with work to the agreed extent and payment of the agreed wages would be unreasonably burdensome for the employer, the employer may, for up to three months over a period of 12 months, unilaterally reduce the wages. Wages and workload must be reduced proportionately, but must not be reduced below the minimum wage (584 euros per month). Read more about the reduction of wages HERE

The wage reduction period is not a calendar year, but 12 monthsExample: An employer reduced employees' wages between 15 April and 15 July 2020. Thus, the 12-month period began on 15 April 2020 and will end on 15 April 2021. As the employer already reduced the wages for three months during the last 12 months, the employer can reduce the wages unilaterally again from 16 April 2021 on the basis of section 37 of the ECA.  

It is important to keep in mind that the 12-month period does not include the term for advance notice for the reduction of wages. Thus, when the employer submitted the notice of reduction of wages on 1 April 2020, but reduced the wages from 15 April, the 12-month period began to run on 15 April and not on 1 April. This year, however, the employer may already announce in advance that, after 12 months, i.e. from 16 April 2021, they will again use the option to reduce wages on the basis of section 37 of the ECA. 

If the employer has already reduced the wages for three months within 12 months on the basis of section 37 of the ECA, then the wages and workload cannot be reduced unilaterally. In such a case, the terms and conditions of employment contract can be amended on the basis of section 12 of the ECA only by agreement between the parties. An employer can propose to an employee to change the wages and workload at any time. If the employee agrees with the employer's proposal, there is an agreement to change the terms of the employment contract. If the employee refuses, the employer has an obligation to provide the employee with work under the agreed conditions. 

If the employer cannot provide the employee with work in the agreed volume and the employee does not work because the employer does not have any work for the employee, the employer shall pay the average wages for such a period pursuant to section 35 of the ECA

If the employee works on the basis of summarised working time calculation or working time schedule (i.e. schedule), then the employer can unilaterally change the already prepared and approved work schedule if the changes arise from an emergency and the employer takes into account the interests of employees. An emergency is presumed in the case of possible damage or a threat of such damage to the employer’s property or other amenity caused, above all, by force majeure (ECA, subsection 17 (4)). 

An employer may unilaterally change the organisation of working time, provided the changes arise from the needs of the employer’s enterprise and are reasonable, considering mutual interests. The purpose of the organisation of working time is to determine the working time, in particular, the start and end of the working time and breaks during the working day. Thus, due to restrictions, unilateral changes in the working time schedule or the start and end times of the work are possible if they arise from an emergency or a need of the enterprise. An employer should justify to an employee why the working time schedule needs to be changed due to the restrictions and what the emergency in this case involves.  

The employment relationship must not conflict with the principle of good faith and the interests of the other party. For example, if an employee does not agree to changes in the working time schedule due to the fulfilment of important family obligations, the employer must take this into account. 

Employers can draw up holiday schedules until the end of March. An employer has the right to unilaterally set the time of annual holidays, except for the persons provided for in subsection 69 (7) of the Employment Contracts Act who have the right to demand annual holiday at a suitable time (a woman immediately before and after pregnancy and maternity leave or immediately after childcare leave; a man immediately after childcare leave or during the pregnancy and maternity leave of a woman; a parent raising a child of up to seven years of age; a parent raising a child of seven to ten years of age – during the child’s school holidays; a minor subject to the obligation to attend school – during school holidays). Once the holiday schedule has been drawn up and communicated to the employees, the holiday schedule may only be amended by agreement between the parties

The parties may agree on the use of holiday without pay. Holiday without pay can only be used upon agreement between the parties, i.e. an employer cannot unilaterally send an employee on holiday without pay. The parties must agree on all matters concerning holiday without pay (especially when this begins and ends). 

Employees raising young children can take child leave. Employees raising one or two children under the age of 14 can take three working days of child leave. Employees raising at least three children under the age of 14 or at least one child under the age of 3 can take 6 working days of child leave. An employee raising a disabled child has the right to take child leave for one working day a month until the child reaches the age of 18. The child leave days taken for a disabled child can also be added up in agreement with the employer. Child leave may be used by one parent at a time. In addition to paid child leave, mothers and fathers can take child leave without pay for 10 working days if they are raising a child up to 14 years of age or a disabled child up to 18 years of age. Although the law requires that the employee notifies the employer of the use of the leave at least 14 calendar days in advance, the employer may, in agreement with the employee, shorten the notice period. Different holiday types may also be included in the holiday schedule with the consent of the employee. 

If none of the above is possible, this is a lay-off situation. Lay-off is the extraordinary cancellation of an employment contract by an employer for economic reasons. Pursuant to subsection 89 (1) of the Employment Contracts Act, it is a lay-off if the continuance of the employment relationship on the agreed conditions becomes impossible due to a decrease in the work volume or reorganisation of work or other cessation of work. Read more about lay-off HERE.

New restrictions and amendments to the employment contract.

Külastusi 25907, sellel kuul 25907

Contact Us

Font size

Line space


About accessibility

We are committed to making this website accessible to as many people as possible.