EMCC European Monitoring Centre on Change



Geographic Location

Country: Estonia
Region: Kirde-Eesti; Eesti
Location of affected unit(s): Narva


Sector: Manufacturing
Manufacture of wood and paper products, and printing
16.23 - Manufacture of other builders\' carpentry and joinery
Number Employed: 111

Employment Effects

Announcement Date: 16-07-2019
Planned Job Reductions min: 111
Planned Job Reductions max: 111
Type of Restructuring: Bankruptcy
Employment Effect Start: 18-07-2019
Foreseen End Date: 01-08-2019
Direct Dismissals: 111

Additional Information

Modulhouse OÜ, an Estonian company of prefabricated timber frame modular buildings construction, announced the closure of the company. The Estonian Unemployment Insurance Fund was notified that 109 employees will be laid off, but eventually the remaining two will lose their job also as the company will be closed down.

Modulhouse has produced modular buildings since 2011 and was very successful. Most of their production was ordered from Sweden and Norway. In 2017 they took up a large, but risky project, which was finished in 2018, but which has still remained unpaid by the client causing a loss of €1.6 million. This has caused a massive strain on the financial solvency of the company and although there are many investors interested in investing in the company, none of them are willing to finance the additional need for capital caused by the loss. As the company has no finances to pay wages to the employees, they decided it is best to dimiss the employees and close the company.

The employer believes that at least some of the employees can find a new job in other companies producing wooden houses. However, while the wooden house production is rather well developed in Estonia, there are not many jobs in this industry in the region. 

Estonian Unemployment Insurance Fund will support the employer and employees, by giving them information about their rights, obligations and possibilities, assisting them with documentation, and helping them find new job or retraining opportunities.