🇪🇪 Toolepingu seadus (TLS) §§ 89, 97, 100 • Tootukassa

Estonia Redundancy & Severance Calculator (Koondamishuvitis)

Accurately determine total statutory termination compensation for redundancy in Estonia. Models mandatory 1-month employer severance, Tootukassa state redundancy pay, notice period indemnification, and unused holiday payout.

Total Statutory Severance Package

Total Gross Package: €4,000.00

Includes €2,000.00 from Employer (1 month) + €2,000.00 from Tootukassa Fund (1 month for 6 years tenure). Statutory notice requirement: 60 calendar days.

Statutory Notice Period 60 Days 5 to 10 Years Service

⚙️ Employment Parameters

€

Calculated based on previous 6 months' earnings under Government Regulation No. 91.

If less than statutory required days, employer pays shortfall.

Encashment required upon final contract termination (TLS § 71).

🧾 Redundancy Package Breakdown Gross Amounts

Employer Severance (TLS § 100(1)): €2,000.00
Tootukassa State Benefit (TLS § 100(2)): €2,000.00
Compensation in Lieu of Notice (Shortfall): €0.00
Unused Leave Encashment (14 days): €933.33
Total Gross Redundancy Package: €4,933.33
Estimated Net Payout (After 20% Tax): ~€3,946.66

⚖️ Statutory Framework: TLS §§ 89, 97, 100

• Employer Payment: 1 month average salary is paid directly with final salary settlement on the final working day.

• Tootukassa Payment: Employer must file Form within 5 calendar days of termination. Tootukassa pays benefit directly to employee's bank account.

Statutory Redundancy Entitlement by Service Length

Length of Service Advance Notice (TLS § 97) Employer Severance Tootukassa Benefit Total Compensation
Under 1 Year 15 calendar days 1 month wage €0.00 1 month wage
1 to 5 Years 30 calendar days 1 month wage €0.00 1 month wage
5 to 10 Years 60 calendar days 1 month wage 1 month wage 2 months wage
Over 10 Years 90 calendar days 1 month wage 2 months wage 3 months wage

Frequently Asked Questions (FAQ)

What is the employer's statutory redundancy compensation under TLS § 100(1)? +

Under § 100(1) of the Estonian Employment Contracts Act (Toolepingu seadus - TLS), the employer must pay the employee redundancy compensation equal to one month's average wage upon cancellation of the employment contract due to redundancy (koondamine), regardless of the employee's tenure.

When does Tootukassa pay additional redundancy benefit? +

Under § 100(2) of the TLS and the Unemployment Insurance Act, the Estonian Unemployment Insurance Fund (Eesti Tootukassa) pays additional redundancy benefit: (1) one month's average wage if employment duration was 5 to 10 years, or (2) two months' average wage if employment duration exceeded 10 years. Application is submitted by the employer.

What are the statutory notice periods for redundancy in Estonia? +

Under TLS § 97(2), the employer must give written notice: 15 calendar days if employed under 1 year; 30 calendar days for 1 to 5 years; 60 calendar days for 5 to 10 years; and 90 calendar days for over 10 years of service. Failure to observe notice triggers mandatory compensation in lieu of notice.

Are redundancy compensation payments subject to tax in Estonia? +

Redundancy compensation paid by the employer is treated income subject to personal income tax (20% or 22%) and unemployment insurance (1.6%), but is exempt from the 33% employer social tax under Social Tax Act § 3(1). Tootukassa benefits are subject to income tax withholding.

What unemployment insurance benefit is available following redundancy? +

If registered with Tootukassa, you receive monthly unemployment insurance benefits equal to 60% of previous average salary for the first 100 calendar days, and 40% thereafter, up to statutory ceilings established annually.

MS

Engr. Muhammad Shahzad

Verified Author & Systems Architect

Principal software engineer and international statutory compliance analyst with extensive expertise in European tax digitalization, Estonian e-Residency architecture, and algorithmic financial engineering.

📊 Estonian Tax and Customs Board (Maksu- ja Tolliamet) Matrix

Statutory Component / Legal Deduction Item Calculated Amount (EUR)
Primary Net / Statutory Payable Amount 0.00 €
MS

Engr. Muhammad Shahzad

Principal Financial Systems Architect & Estonian Digital Governance & Tax Law Principal Architect

Lead software and systems architect specializing in high-performance browser computing, algorithmic validation, financial models, and zero-telemetry client-side privacy architecture.

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