# The India Employee Benefits Stack for Finnish companies

> Finnish parents are used to a statutory duty of care: occupational health care, earnings-related pension and accident insurance all come with the payroll. In India only the pension has a statutory match. Health cover must be bought and designed, outpatient care is an add-on, and gratuity is a liability with no Finnish counterpart.

By Akshay Golechha, Chief Business Officer at Plum (https://www.linkedin.com/in/akshaygolechha/). Published by Plum (https://www.plumhq.com). Canonical: https://www.plumhq.com/india-benefits-stack/finland. Updated 2026-10-05. Part of The India Employee Benefits Stack: https://www.plumhq.com/india-benefits-stack.

## In short

- India has no equivalent of Finland's mandatory occupational health care. Employees above ₹21,000 a month have no statutory health cover; employers buy Group Health Insurance, and need an outpatient add-on to match what työterveyshuolto provides.
- TyEL maps to EPF at 12% + 12% of basic, work-accident insurance to the Employees' Compensation Act plus Group Personal Accident, and there is no Indian holiday bonus. Gratuity after five years is a statutory lump sum with no Finnish equivalent.
- Since 21 November 2025, if allowances excluded from wages exceed 50% of total remuneration, the excess is added back for EPF and gratuity. Check a Finnish pay structure against that rule before copying it.

## Questions

### Is occupational health care (työterveyshuolto) mandatory in India?

No. India has no employer duty to arrange health care for office staff. Employees earning up to ₹21,000 a month are covered by ESI, at 3.25% employer and 0.75% employee. Above that, health cover exists only if the employer buys Group Health Insurance. To match Finnish primary care, add an outpatient (OPD) benefit; standard GHI is built around hospitalisation.

### Do Finnish posted workers have to contribute to EPF?

Not if they hold a certificate of coverage under the India–Finland social security agreement, in force since 1 August 2014, for postings of up to 60 months. Without one they are International Workers and must join EPF from day one with contributions on full salary; the ₹15,000 wage ceiling does not apply. Apply for the certificate before the posting starts.

### What replaces TyEL for Indian employees?

EPF and EPS. The employer contributes 12% of basic plus DA, of which 8.33% goes to the pension scheme, and the employee 12%. The statutory wage ceiling is ₹15,000 a month, but most MNC subsidiaries contribute on full basic. Gratuity adds a statutory lump sum after five years of service, capped at ₹20 lakh, which has no TyEL equivalent.

### Should we pay a holiday bonus (lomaraha) in India?

There is no legal requirement. The only statutory bonus is for employees earning up to ₹21,000 a month, at 8.33% to 20% under the Payment of Bonus Act. If you keep lomaraha for group consistency, write it into the offer letter as a contractual payment and check the package against the Labour Codes' rule that allowances excluded from wages above 50% of total remuneration are added back.

### How much leave do Indian employees get compared with Finland?

Finnish law gives up to 30 weekdays a year, about five weeks. In India leave is set by state Shops and Establishments Acts or the Factories Act: earned leave is typically 12 to 18 days a year, plus casual and sick leave, and public holidays vary by state, with three national holidays. Granting Finnish-style leave in India is a policy choice.

## What changes when you come from Finland

### Assignees from Finland and India's EPF

**The rule.** Foreign nationals employed in India are International Workers under EPF. They must join from day one, with contributions on full salary: the ₹15,000 wage ceiling does not apply.
**Finland and India.** India and Finland have a social security agreement in force since 1 August 2014. Staff posted from Finland for up to 60 months with a certificate of coverage stay in the Finnish scheme and are exempt from Indian EPF. Get the certificate before the first Indian payroll run.

### Mapping Finnish benefits to India

**At home.** Mandatory preventive occupational health care, often with GP-level medical care; TyEL pension averaging 24.4% of pay in 2026 (17.1% employer on average, 7.3% employee); health, unemployment and accident insurance; and a holiday bonus under collective agreements.
**In India.** Group Health Insurance (GHI), with an outpatient add-on to match occupational health care. EPF for pension; the Employees' Compensation Act and Group Personal Accident (GPA) for accidents. Gratuity is statutory: fund it through an insured gratuity scheme rather than carrying it as an unfunded liability.

### Overlap between Helsinki and India

**Time difference.** India is 2½ hours ahead of Helsinki during Finnish summer time (late March to late October) and 3½ hours ahead in winter. India has no daylight saving, so the overlap shifts twice a year; most of the Finnish working day overlaps Indian afternoons.
**What to set up.** Agree who in India signs off endorsements, claims escalations and renewals, so nothing waits for headquarters' business hours.

### India–Finland tax treaty

**Treaty.** India and Finland have a revised double taxation avoidance agreement, signed on 15 January 2010 and in force since 19 April 2010. Short visits are usually exempt from Indian tax under its 183-day and employer conditions; check the exact article before relying on it.
**Secondments.** Long secondments can create a permanent establishment for the parent. Structure recharges and employment contracts with a tax advisor before staff move.

## What you call it in Finland, and what it is called in India

In Finland the employer must arrange preventive occupational health care (työterveyshuolto) from the first employee, many add GP-level medical care on top, and Kela reimburses part of the cost. India has no equivalent duty. A salaried employee earning more than ₹21,000 a month has no statutory health cover at all, and below that line sits ESI, a government scheme. What a Finnish employee gets through occupational health care, an Indian employee gets only if the employer buys Group Health Insurance (GHI).

| At home in Finland | In India | What changes for the employer |
| --- | --- | --- |
| Occupational health care (Työterveyshuolto): Preventive health care every employer must arrange from the first employee; GP-level medical care is optional. Kela reimburses part of the cost. | No statutory equivalent; Group Health Insurance (GHI) with an outpatient (OPD) add-on | Standard GHI is built around hospitalisation. GP visits, tests and prescriptions need an OPD add-on. Health checks are statutory only for hazardous processes under the Factories Act; elsewhere they are a voluntary benefit. |
| National health insurance (Sairausvakuutus (Kela)): Kela's health insurance, part-funded by an employer contribution of 1.91% of pay in 2026, pays sickness allowance and medical reimbursements. | ESI for employees earning up to ₹21,000 a month gross | ESI costs 3.25% employer and 0.75% employee, and only below the ceiling. Above it the employer's statutory health obligation is zero. Paid sick leave comes from state leave rules and the employer, not an insurer. |
| Earnings-related pension (Työeläke (TyEL)): Statutory pension insurance averaging 24.4% of pay in 2026: 17.1% from the employer on average and 7.3% from the employee. | EPF and EPS (Employees' Provident Fund and Pension Scheme) | Applies at establishments with 20+ employees: 12% of basic plus DA from the employer, of which 8.33% goes to EPS, and 12% from the employee. The statutory wage ceiling is ₹15,000 a month; most MNC subsidiaries contribute on full basic. |
| Unemployment insurance (Työttömyysvakuutus): In 2026, 0.31% of payroll up to €2,509,500 and 1.23% above from the employer, plus 0.89% from the employee. | No equivalent for most employees | Nothing to contribute. Exit costs sit in notice pay and statutory gratuity instead. |
| Work-accident insurance (Tapaturmavakuutus): Compulsory employer-paid insurance for accidents at work and occupational diseases; the premium depends on the sector and the company. | Employees' Compensation Act 1923 (or ESI where covered) plus Group Personal Accident (GPA) | The Employees' Compensation Act covers employees who are not in ESI, and the employer insures it. GPA is the usual voluntary add-on for accidental death and disability. |
| Group life insurance (Ryhmähenkivakuutus): Group life cover that employers take out under collective agreements, paying a lump sum to survivors; the premium varies by sector. | EDLI (life cover of up to ₹7 lakh through EPFO) plus Group Term Life (GTL) | EDLI is the only statutory life cover. GTL is voluntary; 3 to 5 times CTC is common for white-collar staff, and it is the usual way to meet a group life standard. |
| Annual leave (Vuosiloma): 2 days per month in the first year and 2.5 days after, up to 30 weekdays (Monday to Saturday), about five weeks. | Earned leave under the state Shops and Establishments Act (offices) or the Factories Act (factories) | Earned leave is typically 12 to 18 days a year, plus separate casual and sick leave. Public holidays vary by state, with three national holidays. Five weeks everywhere is a group policy choice, not an Indian legal floor. |
| Holiday bonus (Lomaraha): Usually 50% of holiday pay, set by collective agreements rather than the Annual Holidays Act. | No equivalent; statutory bonus under the Payment of Bonus Act (8.33% to 20%) for employees earning up to ₹21,000 a month | Nothing like lomaraha is owed in India. If the group keeps it, pay it as a contractual annual payment and check the total package against the Labour Codes' 50% wage rule. |
| Pregnancy and parental leave (Raskausvapaa ja vanhempainvapaa): Pregnancy and parental allowances paid by Kela, with parental leave shared between both parents. | Maternity Benefit Act: 26 weeks of full pay for the first two children, 12 weeks from the third; no statutory paternity leave under central law | In India the employer pays the salary during maternity leave (ESI covers it for ESI members). A crèche is required at 50+ employees. GHI covers the delivery: about ₹1 lakh for a normal delivery, ₹1.25 lakh for a C-section. |

## What Finnish companies get wrong when they set up in India

1. **Occupational health care is mandatory, so India will have a version too.** India has no employer duty to provide health care. Above ₹21,000 a month there is no statutory health cover at all. Group Health Insurance is voluntary in law, and candidates hired at ₹8 LPA and above expect it.
2. **Group health insurance covers GP visits, like occupational health care.** Standard Indian GHI is built around hospitalisation. GP consultations, tests and prescriptions need an outpatient add-on. If headquarters wants parity with työterveyshuolto, specify OPD cover when the policy is placed.
3. **Kela, or a public body, will reimburse part of our health costs.** No public body reimburses employer health spending in India. The employer pays the full GHI premium plus 18% GST, though the premium is deductible under Section 36(1)(ib) and is not a perquisite for the employee under Section 17(2).
4. **Family cover means spouse and children.** In India, parents are the largest claims category by relationship, about 40% of claims in Plum's data. Decide early whether parents are covered and who pays that share of the premium.
5. **Pension and accident insurance come with payroll, as at home.** EPF does, at establishments with 20+ employees, at 12% plus 12% of basic. Accident cover is thinner: the Employees' Compensation Act covers employees not in ESI, the employer insures it, and Group Personal Accident is a voluntary add-on.
6. **We have no leaving payment at home, so nothing to provision.** Gratuity is statutory at establishments with 10+ employees: 15 days' last drawn salary per year of service after five years (one year for fixed-term staff), capped at ₹20 lakh. Provision it from day one and insure it through a gratuity scheme.
7. **A holiday bonus belongs in every package.** There is no Indian holiday bonus. The only statutory bonus is for employees earning up to ₹21,000 a month, at 8.33% to 20%. Above that, bonuses are contractual, and the whole package must pass the Labour Codes' 50% wage test.
8. **Posted staff stay in the Finnish scheme automatically.** Only with a certificate of coverage under the India–Finland agreement, in force since 1 August 2014, for up to 60 months. Without it they are International Workers and join EPF from day one on full salary, with no ₹15,000 ceiling.

## Finland vs India, benefit by benefit

| Benefit | Finland | India |
| --- | --- | --- |
| Statutory health cover | Universal public health care, with Kela health insurance paying sickness allowance and reimbursements. | ESI for employees earning up to ₹21,000 a month. Nothing above that line. |
| Employer health duty | Mandatory preventive occupational health care from the first employee. | None. Group Health Insurance is voluntary; candidates at ₹8 LPA and above expect it. |
| Primary care | GP-level medical care through occupational health care, if the employer chooses it. | Only with an outpatient (OPD) add-on to GHI or a separate plan. |
| Employer health contribution | 1.91% of pay to Kela health insurance in 2026. | 3.25% of wages into ESI below the line; above it, a voluntary GHI premium plus 18% GST. |
| Pension | TyEL averaging 24.4% of pay in 2026: 17.1% employer on average, 7.3% employee. | EPF and EPS at 12% employer plus 12% employee on basic plus DA. |
| Leaving lump sum | No general statutory leaving payment. | Gratuity after five years: 15 days' last drawn salary per year, capped at ₹20 lakh. |
| Unemployment insurance | 0.31% to 1.23% of payroll from the employer, 0.89% from the employee. | No unemployment contribution for most employees. |
| Work accidents | Compulsory accident insurance, employer-paid, priced by sector and company. | Employees' Compensation Act for employees not in ESI, insured by the employer; GPA voluntary. |
| Life cover | Group life insurance under collective agreements. | EDLI up to ₹7 lakh; Group Term Life at 3 to 5 times CTC is common for white-collar staff. |
| Annual leave | 2 to 2.5 days a month, up to 30 weekdays a year. | Earned leave typically 12 to 18 days a year, plus casual and sick leave. |
| Holiday bonus | Usually 50% of holiday pay under collective agreements. | None. Statutory bonus of 8.33% to 20% only for employees earning up to ₹21,000 a month. |
| Maternity | Pregnancy and parental allowances paid by Kela. | Employer pays 26 weeks of full pay (12 from the third child). No statutory paternity leave under central law. |

## Staff seconded from Finland

Posted staff often keep a Finnish or international health plan, but an India-admitted GHI is still worth adding: it gives cashless admission at network hospitals without an advance deposit, and an outpatient add-on can replicate occupational health care. Under the India–Finland agreement, a posted worker with a certificate of coverage stays in the Finnish scheme for up to 60 months and is exempt from EPF. Finns hired locally in India are International Workers and join EPF from day one on full salary.

## Where Finnish companies set up in India

- **Chennai, Tamil Nadu.** Nokia's network equipment manufacturing and KONE's India operations. Plant workforces mean ESI for staff earning up to ₹21,000 a month and the Employees' Compensation Act above it.
- **Bengaluru, Karnataka.** Nokia's research and development centre and UPM Raflatac's label materials plant. Most hires are white-collar, at ₹8 LPA and above, where candidates expect GHI in the offer.
- **Mumbai and Thane, Maharashtra.** Wärtsilä's India headquarters and Huhtamaki India's head office. Maharashtra's Shops and Establishments rules set leave for office staff.
- **Pune, Maharashtra.** Konecranes' crane business and Tietoevry's technology teams. Mixed plant and office workforces need two benefit tiers: ESI up to ₹21,000 a month and GHI above it.

Finnish companies with operations in India include Nokia, KONE, Wärtsilä, Metso, Valmet, Huhtamaki, UPM, Konecranes, Tietoevry.

## Benchmarks: what MNCs and GCCs offer in India

From [The Standard of Employee Benefits 2026–27](https://www.plumhq.com/standard-of-employee-benefits), Plum's report on 15,312 benefit plans, 5,20,100 claims and 74,543 checkups from Plum's FY26 book.

- **1.6×** MNC and GCC benefits spend per employee in India, against a funded Indian startup (nearly 3× a local Indian business). ([source](https://www.plumhq.com/standard-of-employee-benefits#s2-3))
- **43%** of MNCs and GCCs in India are Holistic Leaders: deep insurance plus real breadth of healthcare beside it. ([source](https://www.plumhq.com/standard-of-employee-benefits#s2-3))
- **₹7,50,000** median MNC/GCC sum insured, covering parents or in-laws, with ₹1,00,000 maternity cover and no copays or sub-limits. ([source](https://www.plumhq.com/standard-of-employee-benefits#s2-3))
- **~2%** of payroll buys India's top-quartile plan, against roughly 15% in the US, 10–25% across Europe and 8–15% across APAC. ([source](https://www.plumhq.com/standard-of-employee-benefits#s2-3-coverage))

## Further reading on plumhq.com

- [How MNCs structure health insurance for Indian subsidiaries](https://www.plumhq.com/blog/mnc-health-insurance-india-subsidiary-structure): Global programmes, local policies and who signs what.
- [Do you need to match headquarters' benefits in India?](https://www.plumhq.com/blog/gcc-match-headquarters-benefit-standards-india): Where to mirror the parent plan, and where India needs its own design.
- [Insurance for expatriate employees in India](https://www.plumhq.com/blog/insurance-coverage-expatriate-employees-gcc-india): Covering seconded staff alongside the local plan.
- [Group insurance vs ESI: a guide for employers](https://www.plumhq.com/blog/group-insurance-vs-esi-employers-guide): Who must be in ESI, and where group health insurance takes over.
- [How to calculate gratuity in India](https://www.plumhq.com/blog/how-to-calculate-gratuity): Formulas, worked examples and a free calculator.
- [The Standard of Employee Benefits 2026–27](https://www.plumhq.com/standard-of-employee-benefits): Benchmarks from 4,500+ Indian employee health plans.

Sources: Finnish Tax Administration (Vero), social insurance contributions 2026; Kela, occupational health care: employer obligations; Occupational Health Care Act (1383/2001); Annual Holidays Act (162/2005), Finlex; Suomi.fi, annual holiday pay and holiday bonus; India–Finland Social Security Agreement, in force 1 August 2014; India–Finland Double Taxation Avoidance Agreement (signed 15 January 2010, in force 19 April 2010); Code on Social Security 2020 and Code on Wages 2019, in force 21 November 2025.