With this act, the state intends to reduce illegal use of the labour force, ensure better protection of social guarantees of working people and improve supervision over the collection of labour taxes.

Only one electronic entry is sufficient to register an employee. The collected data will be used by the Estonian Health Insurance Fund, Estonian Unemployment Insurance Fund, Estonian National Social Insurance Board, Police and Border Protection Board, Labour Inspectorate and Estonian Tax and Customs Board. All the above agencies will obtain the data necessary for their operations from one common register and people are not required to submit data to all these agencies separately. 

The information in the register will be used to determine sickness insurance, to register as unemployed and stop registration as unemployed, to determine unemployment support and unemployment insurance benefit, to check the facts of employment, to inform foreigners about the requirements that must be met to be allowed to work, to conduct supervision proceedings of employment relationships and to investigate occupational accidents and ensure that tax obligations are met.

Presently, employers are required to register a new employee not later than on the seventh day, but in future they will have to do it on the first working day.