Amendments Alleviate the Limitations on Employment of Aliens in Estonia
The Parliament passed two draft acts amending significantly the Aliens Act. As a result of the amendments, the possibilities for foreign entrepreneurs for receiving a residence permit for operating in Estonia will be expanded. Furthermore, the salary conditions for foreign workers will become more unified and the conditions for short-term employment in Estonia will become more flexible.
According to the Aliens Act in force, an employee who is from a country that is not a member of the European Union must be paid 1.24 times the average gross salary of Estonia. From 17 January 2017 such obligation will be abolished and the salary requirement will be replaced with the obligation to pay the annual average gross salary of Estonia. In the Chamber’s opinion it would have been even fairer to tie the salary requirement with the average gross salary of the sector, which would unify salaries within the sectors, but the proposal was not supported enough at the Parliament. However, the amendment is still a step in the right direction, decreasing inequality between the salaries paid to foreign employees and Estonian employees.
In order to boost the business environment and promote economic development, foreign entrepreneurs and employees will be provided with more flexible possibilities to live in Estonia. As a result of the amendment of the Aliens Act, major investors will have the possibility to receive a temporary residence permit for entrepreneurship in Estonia if they have made a direct investment of at least one million euros into an Estonian company. This amendment will enter into force on 18 January 2017. We have made efforts to have this amendment in the law for several years. Thanks to the proposal of the Chamber, major investors will also be exempt from the immigration quota starting from 18 January 2017. This step will give the public and potential investors a positive signal that investors from third countries are welcome in Estonia. Additionally, aliens who work in Estonia in the ICT sector or in a start-up will also be exempt from the immigration quota.
The regulation of short-term employment in Estonia will also become more flexible. From 17 January 2017, aliens will have the opportunity for short-term work in Estonia for 270 days a year instead of the previous 180 days a year. Seasonal work is no longer limited with the agriculture sector, because the government has decided to establish an extended list of seasonal work areas.
From 18 January 2017, the holders of residence permits will no longer be required to register their absence from Estonia that exceeds 183 days at the Police and Border Guard Board. Such change was introduced as a result of a proposal made by the Chamber, because the current registration obligation is too burdensome for the aliens who need to travel a lot
For the purposes of promoting entrepreneurship, the possibility to grant temporary residence permits for transfers inside a company will be established from 17 January 2017. Such permits will be granted to aliens whose employer who is located outside the European Union sends the employee to work or for internship to the Estonian affiliate or branch of the same company. The residence permit will also be granted to aliens settling Estonia for the purposes related to start-up business or aliens who start working in the information and communication technology sector, who will be able to apply for the residence permit for their family members under same terms.