Finland Modernises Time and Absence Reporting In Line With Global Payroll Data Trends

Finland is tightening the connection between payroll, benefits, and national data systems. The Finnish Social Insurance Institution (Kela) has discontinued its long-standing eSARA channel for employer benefit applications after 30 September 2025. Going forward, absence information will need to be reported through the Incomes Register (“Tulorekisteri”) or via Kela’s online services. This operational shift places new emphasis on the quality, completeness, and timeliness of digital payroll reporting.

One Data Source for Payroll and Benefits

The Incomes Register, managed by the Finnish Tax Administration (Vero), is the national repository for real-time income and employment data used by tax, pension, and social security authorities. While absence data reporting has so far been voluntary, it plays an increasingly critical role in automating statutory benefit processing.

Until now, many employers have transmitted benefit-related absence data to Kela using eSARA files through Ilmoitin.fi. Kela has announced that this option is no longer possible after 30 September 2025, requiring employers to adopt the Incomes Register or its online service platforms instead. The move aligns with Finland’s broader digital governance strategy: one source of truth for employment data.

Key Changes for Employers

If you operate a payroll in Finland, as an employer, you must prepare for these key changes to remain compliant with local rules and regulations:

• End of eSARA files. After 30 September 2025, employers can no longer use eSARA for sickness, parental, or rehabilitation benefit applications.
• Use of the Incomes Register. Absence data should be transmitted either through the Incomes Register’s standard reporting flow or via Kela’s online daily allowance and reimbursement service.
• Voluntary reporting. Although absence data remains technically voluntary, failing to report may trigger manual document requests from Kela, slowing benefit payments to employees.
• Reporting timeline. If an employer reports absences, these must be included in the next earnings payment report following the pay period in which the absence occurred.
• Scope. Only full-day absences are reportable, including cases where a sick leave begins mid-day and continues into full days thereafter.
• Data requirements. The absence data must include the reporting period, start and end dates, paid or unpaid status, and relevant leave type codes.

These parameters are set out in more detail in guidance published by Vero, and employers, HR, and payroll professionals are encouraged to review this guidance in detail. Of course, the relationship with the customer (employer) and the payroll provider is crucial to ensure end-to-end data testing and compliant, complete, and accurate regulatory reporting.

Operational Implications for Employers

For payroll and HR teams, this transition represents more than a technical update: it requires procedural and data alignment across systems and functions:

• System readiness. Payroll software must support absence-data fields compatible with the Incomes Register format. Providers and in-house IT and HR Technology teams should confirm the configuration.
• Data flow coordination. Those responsible for tracking, managing and approving time and absence data must provide timely and complete data to payroll so that it can be included in the next earnings report. Delays in absence recording may now have compliance implications, and a negative effect on the employee experience when they are eligible for statutory benefits..
• Code consistency. Employers must validate absence reason codes (e.g., illness, parental leave, rehabilitation) to ensure accurate reporting and avoid misclassification of statutory employee benefits.
• Risk of manual processing. Employers who opt not to report absence data may face manual requests from Kela for employer certificates, undermining the efficiency of digital reporting.

This shift mirrors developments seen in other jurisdictions, such as Australia’s Single Touch Payroll (STP) Phase 2, which expanded mandatory reporting to include leave and benefits data, and Brazil’s eSocial reporting requirements demanding the same timely data set from employers. The direction is clear: more integrated, real-time reporting ecosystems that connect payroll and social policy based on reliable payroll data.

Summary and Recommended Actions

Finland’s decision to retire eSARA and reinforce absence reporting through the Incomes Register reflects a growing global trend: governments expect payroll to serve as the authoritative data hub for income, time and absence data, statutory contributions, benefits, and employment conditions.

The data requirements span well beyond what may be needed actually to calculate payroll and produce a compliant payslip: it’s the aorta of all employment-related data to the competent authorities. This offers an opportunity for (global) payroll to be the data custodian and ensure cross-functional collaboration and alignment.

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Max van der Klis-Busink, MCIPP, RPP, is the Owner of Passion For Payroll and Vice President of Global Strategy on PayrollOrg’s Board of Directors.