Employment contract

EMPLOYMENT CONTRACT

This employment contract (hereinafter the "Contract") has been entered into in [City where the contract is signed] on [Contract date] between the following parties (hereinafter together the "Parties"):

1. PARTIES

1.1 Employer:
[Employer's name]
Commercial Register code: [Employer's Commercial Register code]
Address: [Employer's address]
(hereinafter the "Employer")

1.2 Employee:
[Employee's name]
Personal identification code: [Employee's personal identification code]
Address: [Employee's address]
(hereinafter the "Employee")

2. POSITION, DUTIES AND PLACE OF WORK

2.1 Job title: [Job title]. The Employee performs work for the Employer, being subject to the management and supervision of the Employer (Employment Contracts Act (TLS) § 1 (1)).

2.2 Duties: [Job description / duties]. In doing so, the Employee undertakes to cooperate with other employees and to perform, without special instructions from the Employer, tasks arising from the nature of the work or the general course of work.

2.3 Place of work: [Place of work]. Address: [Workplace address].

2.4 Duties are assigned, and their performance supervised, by the Employer or the immediate manager designated by it; an instruction must be related to a duty provided for in the Contract (TLS § 17 (1)).

2.5 The Employer may send the Employee on a business trip outside the place of work to perform duties for up to 30 consecutive calendar days, unless the Parties have agreed on a longer term (TLS § 21 (1)–(2)); compensation for business trips is paid in accordance with the legislation on business trips. The work requires business trips.

3. DURATION OF THE CONTRACT AND PROBATIONARY PERIOD

3.1 Start date of the employment relationship: [Start date of the employment relationship]. The Contract has been entered into for an unspecified term.

3.2 Probationary period: [Probationary period]. The probationary period may not be longer than four months (TLS § 10¹ (1)–(2)).

3.3 If a probationary period applies, it does not include the time during which the Employee was prevented from performing duties, in particular due to temporary incapacity for work or leave (TLS § 10¹ (4)). During the probationary period, either Party may cancel the Contract by giving at least 15 calendar days' advance notice (TLS § 86 (1), § 96); the Employer may not cancel the Contract for a reason that is contrary to the purpose of the probationary period (TLS § 86 (4)).

4. WORKING TIME AND OVERTIME

4.1 The working time is full-time: 40 hours per week, 8 hours per day, 5 working days per week (TLS § 43 (1)–(2)). The start and end of working time and the breaks during the working day are determined in the Employer's work organisation rules (TLS § 47 (1)).

4.2 The Employee is guaranteed at least 11 consecutive hours of rest within a 24-hour period and at least 48 consecutive hours of rest within a seven-day period, unless otherwise provided by law (TLS § 51 (1), § 52 (1)). Work done at night and on public holidays is compensated in accordance with TLS § 45.

4.3 Overtime is work exceeding the agreed working time, which the Parties agree on (TLS § 44 (1)). Overtime is compensated with time off equal to the overtime, unless compensation in money has been agreed; in the case of compensation in money, the Employer pays 1.5 times the wages (TLS § 44 (6)–(7)). The Parties have agreed on the following method of compensation: [Compensation for overtime].

5. WAGES AND TAXES

5.1 Gross salary: [Gross salary (€/month)] euros per month. Payday: day [Payday (day of the month)] of each month. Wages are paid at least once a month by transfer to the bank account designated by the Employee; if payday falls on a public holiday or a day off, it is deemed to fall on the preceding working day (TLS § 33 (1), (2) and (4)).

5.2 The Employer must withhold income tax, the unemployment insurance premium and the funded pension contribution from the wages paid. In addition, the Employer pays social tax and the unemployment insurance premium on behalf of the Employee. The recipient of income tax, social tax, the unemployment insurance premium and the mandatory funded pension contribution is the Estonian Tax and Customs Board. Income tax finances the governmental activities of the state and local government units; social tax finances state health insurance and the first- and second-pillar pensions. The unemployment insurance premium finances unemployment insurance, which, under certain conditions, provides the employee with protection in the event of unemployment through benefits, allowances and services. The mandatory funded pension contribution finances the second-pillar pension.

5.3 The basic exemption is deducted from the wages only on the basis of a written application by the Employee (Income Tax Act (TuMS) § 42 (1)).

6. LEAVE

6.1 Duration of annual holiday: [Duration of annual holiday (in calendar days)] calendar days. The annual holiday is at least 28 calendar days (TLS § 55), and 35 calendar days for a minor and for an employee with partial or no work ability (TLS §§ 56–57); if the duration specified is shorter, the statutory duration applies (TLS § 2).

6.2 In the calendar year in which the employment begins, annual holiday is calculated in proportion to the time worked (TLS § 68 (4)). The time of holiday is determined by the holiday schedule; the Employee gives notice of holiday not entered in the schedule 14 calendar days in advance in a format which can be reproduced in writing (TLS § 69 (2)–(3)). If the Employee is among the persons entitled to choose the time of holiday, the Employee informs the Employer thereof before the holiday schedule is drawn up.

6.3 The Employee is granted other leave on the grounds and for the duration provided by law. The Employer compensates the Employee for leave in accordance with the Employment Contracts Act, compensating the Employee for annual holiday, study leave and leave for caring for an adult person with a profound disability.

7. ILLNESS AND ABSENCES

7.1 The Employee notifies the Employer at the first opportunity of the Employee's temporary incapacity for work and its expected duration (TLS § 15 (2) 10)). In the event of temporary incapacity for work, the Health Insurance Act applies.

8. OBLIGATIONS AND LIABILITY OF THE PARTIES

8.1 The Employee performs the Employee's obligations towards the Employer loyally and with the necessary diligence arising from the nature of the work, complies with the Employer's lawful instructions and the occupational health, occupational safety and fire safety requirements, and uses and keeps the Employer's property and work equipment with due care (TLS §§ 15–16).

8.2 The Employer provides the Employee with the agreed work, pays wages on the agreed terms and at the agreed time, grants the prescribed leave, keeps records of working time and ensures working conditions that comply with occupational health and safety requirements (TLS § 28 (2)).

8.3 The Employee is liable for a breach of the Contract only in the event of fault (TLS § 72); the extent of compensation for damage caused by negligence is determined in accordance with TLS § 74 (2). Upon termination of the Contract, the Employee returns all property entrusted to the Employee by the Employer and hands over the records no later than on the last day of work.

9. CONFIDENTIALITY

9.1 A confidentiality obligation applies (TLS § 22): the Employee keeps confidential the Employer's production and business secrets and other confidential information which the Employer has a legitimate interest in keeping confidential. Description of confidential information: [Description of confidential information]. Duration: [Duration of the confidentiality obligation (in months)] months. Information may be disclosed in the cases provided by legislation; the obligation does not restrict the Employee's right to disclose the amount of the Employee's wages (TLS § 28 (2) 14)).

10. RESTRAINT OF TRADE

10.1 A restraint of trade applies: the Employee does not work for a competitor of the Employer or engage in the same area of economic or professional activity as the Employer (TLS § 23 (1)). Scope: [Scope of the restraint of trade]. Duration: [Duration of the restraint of trade (in months)] months. The restraint is necessary to protect the special economic interest of the Employer (TLS § 23 (2)). A restraint applicable after the termination of the Contract is valid only if it has been entered into in writing and for up to one year from the termination of the Contract (TLS § 24 (1) 2) and 4)).

10.2 Monthly compensation: [Compensation for the restraint of trade (€/month)] euros. The compensation must be reasonable; without compensation, a restraint applicable after the termination of the Contract is not valid (TLS § 24 (1) 3), (3)). The Employer may cancel the agreement at any time by giving at least 30 calendar days' advance notice; the Employee may cancel it in the cases provided for in TLS § 25 (2)–(3).

11. CONTRACTUAL PENALTY

11.1 The Employment Contracts Act provides for the possibility of agreeing on a contractual penalty in the event of breach of the confidentiality obligation (TLS § 22 (2)) and of the restraint of trade (TLS § 26 (1)), and in the event of refusal to commence work or of leaving work for the purpose of terminating the employment relationship (TLS § 77 (1)). Contractual penalty for a culpable breach of an obligation referred to in clause 9 or 10: [Contractual penalty (€, only for breach of confidentiality/restraint of trade)] euros. A contractual penalty does not preclude a claim for compensation of damage not covered by it (TLS § 22 (3), § 26 (2)); a court may reduce an unreasonably high contractual penalty (Law of Obligations Act (VÕS) § 162 (1)).

12. TRAINING AND TRAINING COSTS

12.1 The Employer provides the Employee with training based on the interests of the enterprise, bears the training costs and pays average wages during the training (TLS § 28 (2) 5)). An agreement on compensation of training costs applies: if the Employee leaves work within [Repayment obligation period (in months, if the employee leaves earlier)] months after the end of the training (commitment period), the Employee compensates the Employer's additional costs as follows: [Repayment conditions]. This is not a contractual penalty but compensation of actual costs.

12.2 An agreement on compensation of training costs is valid only if it has been entered into in writing, it specifies the content and costs of the training, and the commitment period does not exceed three years and is not unreasonably long (TLS § 34 (2)). The Employee compensates the additional costs in proportion to the time remaining until the end of the commitment period only if the Employee cancels the Contract for a reason other than a material breach of contract by the Employer, or if the Employer cancels the Contract due to a material breach of contract by the Employee (TLS § 34 (3)–(4)).

13. COLLECTIVE AGREEMENT AND WORK ORGANISATION

13.1 The Employer introduces to the Employee the terms of the collective agreements applicable to the Employee (TLS § 28 (2) 8)). A collective agreement applies to the Employee. Name of the collective agreement: [Name of the collective agreement].

13.2 The Employee confirms having read the Employer's work organisation rules and undertakes to comply with them. The Employer communicates amendments to the rules to the Employee in a format which can be reproduced in writing; the terms of the Contract may be amended only by agreement of the Parties (TLS § 12).

14. REMOTE WORK

14.1 In the case of remote work, the Employer reflects the risks of remote work in the risk assessment of the working environment, instructs the Employee before allowing remote work and ensures suitable work equipment (Occupational Health and Safety Act (TTOS) § 13⁵ (1)); the workplace is furnished by agreement of the Parties (TTOS § 13⁵ (2)) and the Employee arranges a safe workplace in accordance with the Employer's instructions (TTOS § 14 (1) 1¹)). The Parties have separately agreed on remote work. Work equipment is provided by: [Who provides the work equipment?]. The Employer compensates internet and communication costs related to remote work.

15. PERSONAL DATA AND REGISTRATION OF EMPLOYMENT

15.1 The Employer processes the Employee's personal data to the extent necessary to perform the obligations arising from the Contract and the law, and may use authorised processors. The Employer retains the data of the Contract during the term of the Contract and for ten years after the termination of the Contract (TLS § 5 (5)).

15.2 The Employer registers the Employee's employment in the employment register of the Estonian Tax and Customs Board before the Employee commences work.

16. TERMINATION OF THE CONTRACT AND PERIODS OF ADVANCE NOTICE

16.1 The Contract terminates by agreement of the Parties (TLS § 79), by cancellation on the grounds provided for in the Employment Contracts Act (TLS § 83) or on another ground provided by law. A notice of cancellation is submitted in a format which can be reproduced in writing; a conditional notice is void. The Employer must always give reasons for cancellation, as must the Employee in the case of extraordinary cancellation (TLS § 95 (1)–(2)).

16.2 In the case of ordinary cancellation by the Employee, a period of advance notice of 30 calendar days applies (TLS § 85 (1), § 98 (1)).

16.3 The Employer may not cancel the Contract in an ordinary manner (TLS § 85 (5)). In the case of extraordinary cancellation, the Employer gives advance notice according to the Employee's length of employment: less than 1 year — 15 calendar days; 1–5 years — 30 calendar days; 5–10 years — 60 calendar days; 10 years or more — 90 calendar days (TLS § 97 (2)), unless otherwise provided by law (TLS § 97 (3)).

16.4 In the case of cancellation during the probationary period, a period of advance notice of 15 calendar days applies to both Parties (TLS § 96).

16.5 These periods are statutory minimums. If a Party gives less advance notice, the other Party is entitled to receive average wages for each working day by which the notice fell short (TLS § 100 (5)). Upon termination of the Contract, claims arising from the employment relationship become collectible (TLS § 84 (1)) and unused annual holiday that has not expired is compensated in money (TLS § 71).

17. DISPUTES AND FINAL PROVISIONS

17.1 Disputes are resolved by negotiation and, if no agreement is reached, by a labour dispute committee or a court. The term for filing a claim arising from an employment relationship is four months, unless otherwise provided by law (TLS § 3¹); in order to establish the voidness of a cancellation, a claim must be filed within 30 calendar days after receipt of the notice of cancellation (TLS § 105 (1)).

17.2 Amendments to the Contract are made in writing. The Employer submits amendments to the data of the Contract to the Employee in writing no later than on the date on which the amendments enter into force (TLS § 5 (4)). If any provision of the Contract is or becomes invalid, this does not affect the validity of the remaining provisions.

17.3 The Contract is governed by the law of [Governing law]. The Contract enters into force once both Parties have signed it.