Lomapalkka

Lomapalkka, or holiday pay, is the pay an employee receives for time spent on annual leave. In Finland, lomapalkka is part of the compensation for holidays and is intended to ensure that employees continue to earn normally while they are on vacation.

The concept is governed by the Vuosilomalaki (Annual Holidays Act) and by applicable collective agreements or employment contracts. The exact method of calculating lomapalkka can vary, but it generally reflects the employee’s regular earnings during the holiday period. In practice, the calculation often relies on the average earnings from a preceding period (such as the previous months or year) or on the employee’s standard daily wage, as specified by the contract or collective agreement.

There are two related concepts: lomapalkka and lomakorvaus. Lomapalkka is the pay provided during the holiday itself. Lomakorvaus, by contrast, is a compensation paid if an employee does not take their accrued leave, typically when terminating employment, and is calculated according to the same general principles as lomapalkka.

The rules can differ between sectors and employers, so the exact entitlement and calculation method should be confirmed in the applicable collective agreement or employment contract. In practice, lomapalkka ensures that employees receive their regular income while on vacation, aligning payroll with holiday entitlement and the organization’s holiday scheduling.