Finland: Industrial relations profile
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Background
Economic context
Finland is highly industrialised, with a gross domestic product (GDP) rate per head of population or capita that is higher than the average for the 27 EU Member States (EU27). Finland’s average GDP growth in 2004–2007 was 1.3 percentage points higher than the EU27 average. Real GDP growth has been rapid during the period (3.96%). In 2004–2007, the employment rate slowly increased, reaching 70.3%. Female employment in Finland is clearly higher (68.5%) than the EU27 average (58.3%). Labour productivity in Finland has been relatively high during the period 2004–2007 and is clearly higher than the EU27 average.
Legal context
The most essential legal framework for collective bargaining is the Collective Agreements Act (13Kb PDF) (Työehtosopimuslaki) of 1946, which is complemented by basic agreements between trade union confederations and employer organisations.
Labour market relations are characterised by close cooperation between the state and the social partners. Almost all legislation concerning working life is based on a tripartite consensus.
Impact of economic crisis
The current global economic crisis has had a severe impact on the Finnish economy. According to figures released by Statistics Finland (Tilastokeskus), the decline in the country’s economic output deepened in January 2009; when adjusted for working days, output decreased by 9.8% from the same period in 2008.
The Confederation of Finnish Industries (Elinkeinoelämän keskusliitto, EK) has argued that the ongoing economic recession is so difficult that pay increases are not possible in the upcoming bargaining round (FI0904019I).
In February 2009, the Finnish government approved a supplementary budget for 2009 including a special stimulus package (FI0902049I). The overall impact should amount to €2 billion. It includes about €140 million in transport infrastructure projects. The social partners have welcomed the measures. The Central Organisation of Finnish Trade Unions (Suomen Ammattiliittojen Keskusjärjestö, SAK) highlighted the emphasis on construction projects while EK considered it a positive step towards supporting economic revival.
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