Legislative reform to improve employment rights and conditions

A number of labour market changes in Finland came into effect in January 2008. Legislation providing a right to sabbatical leave has been renewed for 2008–2009. Furthermore, failure to report reasonable grounds of terms and conditions of employment will constitute an offence, punishable by a fine. Following a six-month transition period, the revised Act on cooperation within undertakings is now also in force in companies with 20−29 employees.

At the beginning of 2008, a range of legislative measures pertaining to the labour market in Finland were renewed, strengthened or widened in their scope. These reforms are outlined under the following headings.

Sabbatical leave

Legislation providing a right to sabbatical leave has been continued for two years, in 2008–2009. According to Finnish labour law, it is possible to take sabbatical leave once every five years, and the minimum requirement is overall employment service of at least 10 years before taking the leave and 13 months’ employment with the same employer.

An employee can have a sabbatical leave by the end of 2010, as long as it is agreed during 2009. The parliament has provided that the system of sabbatical leave will be incessant after 2009. The compensation paid will remain almost unchanged. The legislation, however, stipulates that the replacement candidate should be an unemployed job applicant. Thus, a full-time student cannot replace a person taking sabbatical leave.

Terms and conditions of employment

As of 1 January 2008, according to new legislation, failure to report reasonable grounds of terms and conditions of employment will constitute an offence, punishable by a fine. Moreover, the means of control by industrial safety inspectors will be improved. The change of the current Employment Contract Act (FI0107193F) does not load new obligations on employers, but it will activate the observance of duty to provide clarification to employees.

According to the revised Employment Contract Act, when an employment relationship is to last over one month, the employer has to give a written report to the employee regarding the essential terms of employment, if this is not agreed in the employment contract. Such essential terms include the starting time of the employment, duration of a temporary employment contract and grounds of a fixed-term contract, probationary time, location of employment, primary work tasks, applicable collective agreement, pay, working hours, determining of annual leave and period of notice. The threat of a fine is designed to encourage employers to consider more carefully than is currently the case the grounds of temporary employment and to ensure that employees receive these grounds in writing.

The position of fixed-term contract workers will be further improved by the increased authority and right of information availability of shop stewards in client companies; shop stewards should be notified of any agreement on the use of outside labour. This notification should give details regarding the number of workers to be hired, the length of the agreement, and the applicable collective agreement or principal terms and conditions of employment. This amendment is based on the proposal of a tripartite working group (FI0603039I), but the drafting of a law is unfinished and the time of coming into force is not yet clear.

Fixed-term employment contracts have accumulated in sectors such as education, and health and social work. According to the lawyer of the Confederation of Unions for Academic Professionals (Akateemisten Toimihenkilöiden Keskusjärjestö, AKAVA), Maria Löfgren, the revised legislation and the legal amendments in preparation are a step for the better. ‘The labour market should be developed so that an employee dares to really question an unfounded fixed-term employment contract,’ Mrs Löfgren stated.

Employers oppose new act on cooperation

The revised Act on cooperation within undertakings entered into force on 1 July 2007 and, after a six-month transition period, the new Cooperation Act now also applies to companies with a minimum of 20 employees (FI0701029I). However, according to the Federation of Finnish Enterprises (Suomen Yrittäjät), which represents small and medium-sized enterprises (SMEs), the new act will hinder the growth of enterprises and new employment. Instead, it will foster fixed-term employment contracts, subcontracting and temporary agency work. The federation was opposed to the reform and considers that extending the scope to enterprises with 20 employees will make their operations more difficult (FI0607019I).

In December 2007, Suomen Yrittäjät conducted a membership survey concerning the impact of the revised act. According to the survey, half of enterprises employing 15–19 personnel reported that they would not increase their workforce to 20 employees or more when the new act came into effect in January 2008.

Pertti Jokivuori, Statistics Finland

Useful? Interesting? Tell us what you think. Hide comments

Eurofound welcomes feedback and updates on this regulation

Neuen Kommentar schreiben