Finland: Self-employed workers

  • Observatory: EurWORK
  • Topic:
  • Published on: 23 February 2009



About
Country:
Finland
Author:
Pertti Jokivuori, Arto Miettinen
Institution:

Disclaimer: This information is made available as a service to the public but has not been edited or approved by the European Foundation for the Improvement of Living and Working Conditions. The content is the responsibility of the authors.

The definition of self-employed worker is an employed person who is not an employer and who is working without an employment contract. By legal definition a person is considered an employee if they work in return for pay or some other remuneration, work for an employer (a person other than the employee), work under the supervision of the employer, and perform the work themselves. In legal terms, there is no third category in terms of performing work. Self-employed workers are theoretically covered by the same social security regime as employees, but in reality, the social benefits of self-employed workers are often not as great as those enjoyed by employees. In 2006, there were a total number of 141,000 self-employed workers in Finland.

1. Legal provisions and social security

Please provide the definition of self-employed workers which is applicable in your country.

The definition of a self-employed worker is an employed person who is not an employer and who is working without an employment contract.

Briefly indicate the main differences, if any, in the social security regime of self-employed workers with no employees compared with: a) employees; b) self-employed with employees.

Self-employed workers are formally covered by the same social security regime as employees, but in practice, the social benefits of self-employed workers are often not as great as those enjoyed by employees. The self-employed workers’s pension is calculated according to the Entrepreneurs’ Pension Act (YEL). The YEL takes into account entrepreneurial activities that have lasted for at least four months after the time a person turned 18 years of age if their confirmed YEL income exceeds the minimum of €5,504.14 a year (in 2004). However, the main reason for self-employed workers’ low level of social security is the fact that self-employed workers often choose the minimum level of contribution, which in turn results in a low level of coverage.

The Ministry of Social Affairs and Health set up on 12 January 2003 a working group to consider how the social security coverage of self-employed persons could be developed so as to encourage more people to become entrepreneurs. lThe group was assigned to investigate whether self-employed persons’ social security differs unreasonably from that of wage-earners to the effect that it negatively affects the desire to become an entrepreneur. The purpose was to take account of differences and characteristics related to the position of entrepreneurs and wageearners as well as equality and transparency in the financing of social security.

The working group reviewed the social security of self-employed persons both as an entirety and compared with that of wage-earners. The basic aim is to secure adequate and reasonable social security for all those in gainful employment. Self-employed persons have, however, been given more extensive rights to choose themselves both the composition and level of their security. The working group examined, in particular, whether there are problems with the social security of self-employed persons that could weaken the desire to take up entrepreneurship. However, no major problems were considered to exist.

The group, however, proposes improvements in particular to the occupational health care of self-employed persons, the length of waiting periods for sickness insurance benefits and to income security for unemployed family members. Amendments are also proposed to the definition of self-employed persons in pension insurance and accident insurance.

The working group also proposes an amendment to the definition of self-employed person in the Self-Employed Persons Pensions Act (YEL) to the effect that in a limited company, a person should be considered as a self-employed person if they solely own at least 30 % of the enterprise, or together with his/her family members at least 50 % and him/herself at least one share. In this context also, a cohabiting spouse should be regarded as a family member, if the spouses live in the same household (at present the condition is one child in common).

The working group proposes that in accident insurance the definition of a self-employed person should be amended so as to correspond better to the definition under YEL, that indirect ownership is taken into account and that general partners in a partnership are always regarded as self-employed persons.

The occupational health care of self-employed persons is proposed to be reformed so that the entrepreneurs and farmers for whom an agreement on the provision of preventive occupational health care has been made could also agree on organising medical care as a part of occupational health care as of 1 January 2006. This reform is related to the reform of the financing of sickness insurance. Accordingly, the costs related to this proposal, amounting to EUR 4 million, will be covered by the state. The working group also proposes payment of sickness allowance to self-employed persons for periods of incapacity for work, exclusive of the day when the disability begins and the three following weekdays. This reform would concern the self-employed persons insured under YEL. Its estimated costs are EUR 7.5 million. The reform is to be financed by collecting an increased daily allowance contribution to the earnings insurance under sickness insurance from the self-employed persons insured under YEL. The increase in the contribution would be 0.25 percentage points. The working group proposed, in accordance with its assignment, in its interim report some improvements to the income security of unemployed entrepreneurs in order to facilitate the taking up of entrepreneurship by wageearners and the moving into employment on the part of entrepreneurs .These proposals have been implemented as of 1 January 2005.

In addition, the working group has discussed definitions related to YEL and the need to revise it and suggests a revision of some other benefits related to the social security of self-employed persons.At the moment, the main difficulties related to the social security regime of self-employed workers concern the fact that because of more extensive rights to choose themselves both the composition and level of their security, the level of social benefit for these workers is usually below that for employees. When YEL income is defined at a low level, the social benefits are also at a low level (for instance sickness benefit). The second main problem is the lack of a deputising system, which means that it is very difficult to take annual holiday or take leave to care of sick children etc.

Please indicate the existence of any particular legal forms of employment which cover contractual relationships which are commonly regarded to be mid-way between dependent employment and self-employment (if necessary, see for a longer discussion of the concept the EIRO comparative study ‘Economically dependent workers', employment law and industrial relations’).

In Finland, there are no legal forms of the commonly regarded mid-way contractual relationship. According to the Employment Contracts Act (55/2001), section 1, Scope of Application:

This Act applies to contracts (employment contract) entered into by an employee, or jointly by several employees as a team, agreeing personally to perform work for an employer under the employer's direction and supervision in return for pay or some other remuneration. This Act applies regardless of the absence of any agreement on remuneration, if the facts indicate that the work was not intended to be performed without remuneration. Application of the Act is not prevented merely by the fact that the work is performed at the employee's home or in a place chosen by the employee, or by the fact that the work is performed using the employee's implements or machinery.

Thus, by a legal definition a person is considered an employee if he/she works in return for pay or some other remuneration, works for an employer (some other person than the employee), works under a supervision of the employer, and the work is done personally by the employee.

Traditionally there has been made a clear distinction between an employer and an employee. People who carry out an employment contract and subordinate themselves to a single business are employees, and people who run their own business or contract out their products and services are independent contractors.

In legal terms, there is no third category of performing work. If the characteristics of a labour contract are valid (see the scope of application), the contract is considered to be a labour contract, regardless of contracting party title (like “freelance”, “subcontract”, “commission” etc.).

whether they are commonly considered as economically dependent employment;specify the main features of such forms of employment and whether they enjoy specific social security regime and, if relevant, the basic features of such special regime (please refer this illustration to the answer given to question 1.2 above).indicate any rules which generally apply to this kind of employment as for: a) working time and vacation; b) maternity and parental leave; c) sick pay and leave for sickness

2. Recent trends in self-employment with no employees

Please provide data on recent trends in self-employment (since 2000):

Recent trends in self-employment are displayed in table 1.

Table 1. Recent trends in self-employment (2000, 2003, 2006), in thousands
       
    Self-employed* Self-employed*
    (no.) (with no employees)
2000 Total 212 123
  Men 144 77
  Women 68 46
2003 Total 213 124
  Men 142 77
  Women 71 47
2006 Total 230 141
  Men 156 90
  Women 74 52
       
* Excl. Agriculture, forestry and fishing
  Source: Labour Force Survey, Statistics Finland
       

Please report, according to available research and studies,

the distribution of self-employment without employees across sectors and occupations;

Distribution of self-employment without employees can be seen in table 2.

Table 2. Self-employment by sectors (2000-2006),in thousands.
  2000 2003 2006
Total 123 124 141
       
C-E Industry, total 15 14 14
Consumer goods industry 4 4 3
Manufacture of forest industry products and furniture 3 4 3
Publishing, printing and reproduction of sound and other recordings 2 1 1
Metal etc. industry 5 5 5
Other manufacturing industry 2 1 1
F Construction, total 15 18 22
Civil engineering 3 3 5
Building construction, building installation and completion 12 15 16
G,H Trade, hotels and restaurants 26 24 27
G Trade 22 20 23
Sale of motor vehicles 2 1 1
Service station activities and repair of household goods 5 5 5
Commission trade and wholesale trade 5 6 8
Retail trade 10 9 9
H Hotels and restaurants 4 4 4
I Transport, total 11 10 11
Transport 11 10 11
Communication 0 0 0
J,K Financial intermediation, insurance and business activities 23 23 29
Financial intermediation and insurance 1 1 2
Real estate activities, letting and cleaning 5 3 5
Technical consultancy and business activities 18 19 22
L-Q Public and other services, total 33 34 39
Public administration and defence * * *
Education 1 2 2
Health 6 8 8
Social work 2 3 3
Other services 23 22 26
X Industry unknown 0 1 0
       
Source: Labour Force Survey, Statistics Finland      
* Data too uncertain to be presented      
       

whether self-employment without employees has either increased or decreased significantly in recent years (since 2000) in specific:

Sectors and activities.

As seen in table 2, self-employment has increased in construction, especially in building construction (from 12,000 to 16,000). The development has been similar in financial intermediation (from 23,000 to 29,000), and especially in technical consultancy and business activities (from 18,000 to 22,000).

Occupations (International Standard Classification of Occupations – ISCO 88, at one digit).

Data on self-employed by occupations can be seen in table 3.

Table 3. Self-employed by occupations (2000, 2003, 2005), 100 persons.
  2000 2003 2005
1 Legislators, senior officials and managers 349 223 289
2 Professionals 238 238 247
3 Technicians and associate professionals 166 169 213
4 Clerks 10 8 9
5 Service workers and shop and market sales workers 150 207 211
6 Skilled agricultural and fishery workers 4 11 12
7 Craft and related trade workers 212 237 220
8 Plant and machine operators and assemblers 72 117 111
9 Elementary occupations 25 27 40
0 Armed forces * * *
Unknown 3 2 1
       
Source: Labour Force Survey, Statistics Finland      
       

and in specific groups of workers defined by:

Gender (men/women).

As can be seen in Table 1, self-employment has increased among both women and men. The increase has been consistent among men 2000-2006 (some 3,000 per year), but for women especially between 2003 and 2006 (from 47,000 to 52,000).

Age groups (younger/older; 14-24, 25-54, 55-64; 65 and over).

As can be seen in Table 4, self-employment without employees has increased significantly, from 18,000 to 30,000, in the age group 55-64. It is also interesting that the level of self-employment without employees is so high in the age group 65-74 in the year 2006. The proportion of self-employed people in that age group is 5%, whereas it is some 1% among all employed in the same age group.

Table 4. Self-employment with no employees by age and gender (2000, 2003, 2006), in thousands
         
  Age 2000 2003 2006
Total 15-24 3 3 5
  25-54 99 91 99
  55-64 18 24 30
  65-74 3 6 7
Men 15-24 2 2 3
  25-54 61 55 62
  55-64 12 15 21
  65-74 3 4 5
Women 15-24 1 2 2
  25-54 38 36 38
  55-64 6 8 9
  65-74 1 1 2
         
Source: Labour Force Survey, Statistics Finland
         

Nationality (nationals/foreign nationals).

Only some 1,000 self-employed have a nationality other than Finnish. The data are, therefore, too uncertain to be presented by nationality.

Other relevant dimensions to be specified.

Based on existing research and studies, please provide any available data on the diffusion and recent trends of:

All legal forms of employment indicated in section 1.3 above (contractual relationships mid-way between dependent employment and self-employment and economically dependent employment), specifying whether they concentrate in any sectors and/or occupations. ‘Bogus self-employment’, i.e. formal self-employment which is fraudulently used to disguise contractual relationships which should be properly registered as dependent employment, in order to avoid the protections and costs (both wage and social contributions) connected with the latter, specifying whether it concentrates in any sectors and/or occupations. In recent year,s the organising of production has strongly been influenced by subcontracting and outsourcing. Workload has been divided between employees and independent contractors, who take an entrepreneurial risk. However, the difference between an employer and an independent contractor isn’t always clear. In some circumstances reductions of labour force and use of independent contracts instead of employees can lead to something we call compulsory (or disguised) employment or pseudo contracting.

In such situations companies usually try to reduce their costs by subcontracting work to their own employees, and in order to keep their jobs they will be forced to start a company of their own. Employers may sometimes use these arrangements for increasing flexibility and achieving increased profits. For a single employee this means a transition from employment to a compulsory, unwilling self-employment.

There are various reasons for bogus employment from the point of view of the employer. These include: lower taxation, avoiding the risk of an unfair dismissal, and avoiding the expenses and costs of labour regulation. With an independent contractor the employer does not have to provide holiday or sick leave. From the employers’ point of view, therefore, disguised employment can be a way of preventing risks. The risk is lower with the use of independent contractors, while the employer does not have to pay any social costs or wages for times when there is less work. The risk is transferred from one’s company to a person, i.e. the former employee.

The lack of protection by labour and social law can be a serious threat, which is not always understood correctly by the employees, especially if they lack the knowledge and skills to become self-employed and start a business own their own.

The Finnish tax system does not necessarily accept disguised employment. If a company uses a subcontractor operating as a self-employed worker, the subcontractor’s company can be taxed as if she/he were an employee, particularly if the income comes from a single source, which is the former employer. At the same time, there is a risk that the company using such employees can later be ordered to pay statutory social costs. This kind of “time bomb” may last for as many as five years.

Disguised employment is seen as a negative phenomenon, not only by employees, but also by some employers as it can create uncertainty in the labour market and lead to unfair competition.

3. Collective representation and collective bargaining

NCs are requested to indicate the main collective representation organisations of employed workers with no employees or of the workers with the special contractual relationships illustrated above in section 1.3. In particular, they should provide information on:

The type of associations (trade associations or trade unions).

At the moment, a proportion of self-employed workers identify themselves as an entrepreneurs and some identify themselves as employees (see section 5). The most important representation association of self-employed workers with no employees is the Federation of Finnish Enterprises (Suomen Yrittäjät, SY) which has the largest membership among economic federations in Finland. The membership of SY consists of about 98,000 enterprises of all sizes, from all corners of the country and covering the entire business spectrum. A total of 48,000 are self-employed persons with no employees.

The Central Association of Women Entrepreneurs (Yrittäjänaisten keskusliitto) is an organisation looking after the interesst of women entrepreneurs in operational, business and social issues. The association was founded in 1947. It has more than 100 local organisations across the country.

The associational domains of each of such associations: territorial, sectoral, occupational, professional, etc.

Suomen Yrittäjät has 21 regional organisations, 49 sectoral trade organisations that represent entrepreneurs from different professional branches and 417 local associations. Regional organisations follow the traditional provincial division. Some sectoral trade organisations have concluded collective agreements for entrepreneurs.

Membership and membership rates.

The membership rate of self-employment in Suomen Yrittäjät is 34 %.

Any forms of social dialogue or collective bargaining these associations engage in, specifying:

The levels at which such activities take place (national, sectoral, territorial, company).

The entire organisational chain in Suomen Yrittäjät takes part in lobbying. The local associations have an important role in economic politics on the municipal and district level. Regional organisations have considerable influence in their own regions and counties. Suomen Yrittäjät advances the interests of enterprises with the government, ministries, parliament, and major interest organisations, as well as within the European Union.

The actors they engage in these activities with (public authorities, employers associations, single employers).

The actors Suomen Yrittäjät usually engage with are public authorities of central and local government, employers associations and single employers.

The topics typically covered by these activities.

The main fields of interest for the Federation of Finnish Enterprises in the public sector are:

Taxation

Labour policies

Legal issues dealing with enterprises

Functioning of the public sector

Entrepreneurship training

International lobbying mainly within the EU

The typical outcomes of such activities (joint documents and declarations, guidelines, agreements, etc.)

One important outcome of activities of this kind is the start-up grant system. The purpose of the start-up grant is to promote entrepreneurship and employment. The start-up grant provides for the livelihood of the entrepreneur while starting up the business and establishing its activities. A start-up grant can be given to an unemployed job-seeker and, in 2005-2007, experimentally also to a person moving from paid employment, studies or domestic work to full-time entrepreneurship. The decision to give a person the start-up grant is made by the Employment Office.

A brief description of the content of some (two or three) of the main and most recent of such documents.

The Finnish transport and logistics union (Suomen Kuljetus ja Logistiikka, SKAL) is an industrial political special-interest (group) association, which includes 7,400 transport entrepreneurs and self-employed drivers. SKAL (which is a member association of SY) has succeeded in negotiating exceptions to the working time regulations in Nothern Finland. The question of whether the self-employed drivers should be covered by national implementing legislation (Directive 2002/15EC) is a real hot issue in Finland. Finland (the government) has sharply opposed the extension of the Directive to self-employed drivers; and the strongest criticisms come from SKAL. According to SKAL, the extensionwill result in unreasonable restrictions on self-employed drivers, bankruptcies and will also form a notable bar to entrepreneurship. Increased regulation will lead to increased control which will result in company mergers, because small entrepreneurs will not be capable of complying with all legislative obligations

The Central Association of Women Entrepreneurs (Yrittäjänaisten keskusliitto) has created a special system, the purpose of which is to provide benefits for self-employed workers in the case of sickness, maternity leave etc.

4. Employment and working conditions

Wage levels, of self-employed workers without employees compared with the national average.

Wage levels of self-employed people without employees compared with self-employed people with workers and with the employed average are presented in Table 5.

Table 5. Wage level of self-employed and employed average (2000, 2003, 2005). Annual income (in EUR).
             
    2000* 2003* 2005*    
  Employed average 23,922 26,407 28,754    
  Self-employed 19,639 20,423 22,892    
  Self-employed (no employees) 14,473 14,899 16,727    
             
* Earnings = wages and salaries entrepreneurial income (without options). Earnings are given in the currency in use during the year.
  Source: Income distribution statistics, Statistics Finland      
             

The incidence of low-paid jobs (that is, according to the OECD definition, jobs which pay less than two-third of the median wage) among self-employed workers without employees compared with the national average.

The incidence of low-paid jobs is presented in Table 6.

Table 6. Incidence of low-paid jobs, % (2000, 2003, 2005), self-employed workers without employees.
       
  2000 2003 2005
Employed      
average 10 11 12
       
Self-employed 17 21 17
with no employees      
       
Source: Income distribution statistics, Statistics Finland
       

Working hours, of self-employed workers without employees compared with the national average:

Average hours actually worked per week.

Average hours actually worked per week are presented in the table 7.

Table 7. Average hours actually worked per week (2000, 2003, 2006).
               
Self-employed workers without employees Employed average  
               
  2000 2003 2006   2000 2003 2006
Total 123 124 141   2,335 2,365 2,443
1-4 hours 2 2 3   20 19 25
5-9 3 3 3   30 28 31
10-14 3 3 4   29 31 38
15-19 3 3 4   45 51 51
20-24 6 9 8   75 91 87
25-29 4 4 5   42 45 47
30-34 8 9 11   132 135 151
35-39 8 8 13   918 938 995
40-44 29 29 34   686 699 694
45-49 13 13 13   97 96 94
50 Hours 40 36 39   240 214 211
Unknown 5 4 5   22 17 20
               
Source: Labour Force Survey, Statistics Finland      
               

Diffusion of long working hours (more than 10 hours a day).Diffusion of work at unsocial hours (night, weekend).

Diffusion of work at unsocial hours is presented in Tables 8 and 9.

Table 8. Working in the evening, % (2000, 2003, 2005).
               
Self-employed workers without employees   Employed average  
               
               
  2000 2003 2005   2000 2003 2005
Regularly 27.2 26.9 27.1   23.5 23.7 24.5
From time to time 39.1 35.9 37.7   25.7 23.7 23.4
Never 33.6 37.1 35.1   50.1 52.6 52.1
               
Source: Labour Force Survey, Statistics Finland        
               
Table 9. Working at night, % (2000, 2003, 2005).
               
Self-employed workers without employees   Employed average  
               
  2000 2003 2005   2000 2003 2005
Regularly 5.4 5.6 4.6   8.6 9.2 9.2
From time to time 11.4 10.4 10.1   8.2 7.3 7.0
Never 83.0 83.9 85.3   83.1 83.5 83.7
               
Source: Labour Force Survey, Statistics Finland        
               

Place of work of self-employed workers without employees compared with the national average:

Home/office distribution.

Diffusion of working at home is presented in Table 10.Table 10. Working at home, % (2000, 2003, 2005)
               
Self-employed workers without employees   Employed average  
               
  2000 2003 2005   2000 2003 2005
Regularly 28.4 28.5 28.9   26.9 27.4 28.1
From time to time 17.1 20.4 20.1   18.8 21.9 21.6
Never 54.4 51.0 51.0   54.2 50.6 50.2
               
Source: Labour Force Survey, Statistics Finland        
               

In the study “At the boundaries between entrepreneurship and waged work” (2007), this topic is approached through the organisation of activities. When examining the physical organisation of work in two of the reference groups in the study, some differences were observed between (1) freelance journalists and (2) translators and interpreters. Translators and interpreters work at home slightly more often (80% vs. 77%), whereas freelance journalists more often work in a separate work room or office, which is either their own or leased (19% vs. 11%). Both groups work relatively seldom mainly on the premises of a customer or customers (fraalance journalists 2%, translators and interpreters 5%). However, these data are not relevant in a comparative analysis between self-employed without employees and self-employed with employees.

Exposure to risks and accidents at work of self-employed workers without employees compared with the national average:

Work accident rates.

The Federation of Accident Insurance Institutions (FAII) functions as the co-ordinating organ of all the organisations which are engaged in statutory accident insurance. Each insurance company providing statutory accident insurance in Finland has to be a member of FAII. However, because the insurance is voluntary for self-employed persons, it is impossible to count work accident rates for self-employed people without employees. Only some 40% of all self-employed peopl have taken out voluntary insurance and it is impossible to say how many of them are self-employed without employees. Therefore, any data on this matter are too uncertain to be presented.

Health outcomes, work-related health problems and occupational illnesses of self-employed workers without employees compared with national average:

Occupational illness rates.

The Federation of Accident Insurance Institutions (FAII) functions as the co-ordinating organ of all the organisations which are engaged in statutory accident insurance. Any data on this matter is too uncertain to be presented for the reasons stated in the answer to question 5 above.

Work intensity and stress at work

There is no data on this matter.

Lifelong learning of self-employed workers without employees compared with the national average:

Participation rates in continuous education and training.

Participation rates in continuous education and training are given in Table 11.

Table 11. Lifelong learning of self-employed workers without employees (2003-2005). Participation rates, %.
           
  Self-employed workers National average
  without employees*      
           
  2003 **   22.4  
  2004 **   22.8  
  2005 **   22.5  
           
* Excl. Agriculture, forestry and fishing  
  Source: Labour Force Survey, Statistics Finland
** Data will be delivered later    

Work-life balance of self-employed workers without employees compared with the national average:

Presence and take up rates of maternity/parental leave (according to the applicable social security regime).Presence and take up rates of long-term leave (according to the applicable social security regime). If possible, please indicate the reasons for long-term leave.Degree of control of personal working time.Degree of consistency of personal working time with family and social commitments. There are no data on this matter. One study on “Involuntary entrepreneurship” (2007) covers some of the work-life balance questions, comparing involuntary self-employment and voluntary self-employment. In that study, involuntary entrepreneurship refers to situations where a person is somehow driven into self-employment and does not do this necessarily by choice. However, these data are not relevant in comparative analysis between self-employed without employees and self-employed with employees.

Job satisfaction of self-employed workers without employees compared with the national average:

Degree of satisfaction with employment conditions.

It is a well-documented empirical regularity that it is more satisfying to be self-employed than to work as an employee for an organisation. A large part of this difference in job satisfaction is in the literature attributed to the strong perception of independence by the self-employed. By making use of disaggregated sequential microdata on people´s time use, recearchers Ari Hyytinen and Olli-Pekka Ruuskanen were able to document that perceived independence hardly derives from more flexible time use: The self-employed work longer effective hours as well as more in the evenings and weekends than the organisationally employed. Although being able to time one´s work may be a signal of flexibility in time use, the self-employed have less pure leisure and are less frequently absent from work in general, and because of sickness on weekdays in particular. Moreover, the research documents that the self-employed who have small children are more likely to work after 5 p.m., when the communal day-care centers close. On the basis of these findings it is not surprising that the self-employed perceive that they are more often than the organisationally employed under time pressure.

Degree of satisfaction with working conditions.

There are no precise data on this matter. However, the study “Involuntary entrepreneurship” (2007) contains some tangentially relevant material. These data can be seen in Table 12.

Table 12. Satisfaction with self-employment of workers who have become self-employed due to lack of paid work or threat of unemployment (on a scale 1-7).
       
  Involuntary   Others
  self-employed    
  (N=188)   N=628)
General job satisfaction 5.4   5.6
       
Satisfaction with social security 3.27   3.76
(incl. parental leave, pension)      
       
Satisfaction with social relationships 4.85   5.02
and the work community      
       
Satisfaction with mental factors, 5.65   5.73
i.a. recognition for work and independence      
       
Source: Kautonen, T. 2007      
       

In the study “At the boundaries between entrepreneurship and waged work” this issue is covered with only one overall question on general job satisfaction. The data are given in table 13.

Table 13. Satisfaction with work and livelihood of full-time self-employed workers. Respondents who agree completely or agree somewhat, total %*.
       
  Total Freelance Translators
    journalists and interpreters
  (N=542) (N=220) (N=322)
Overall satisfaction      
Satisfied with decision to enter full-time self-employment 87 84 91
Quality of life better than in paid work 68 70 66
       
Content of work is rewarding and engaging      
Self-employment allows the most self-realisation 86 85 87
Self-employment allows more control of work-related matters 86 85 88
than paid work      
Paid work would leave more free time than full-time 45 44 47
self-employment      
       
*Scale 1-5, where 1=agree completely and 5=disagree completely      
       
Source: Akola, Elisa et al. 2007      
       

5. The social partners’ positions

In a governmental report dating from 2004 on Finnish working life emphasis is given to the surveillance of the Act on Employment Contracts in order to ensure that employment is in accordance with the law and that entreprenerial activity is encouraged by various means.

Some trade unions have worked for a clearer position for self-employed workers with regard to their employment and social security status. Traditionally trade unions in Finland have focused purely on employees. The statutes of most trade unions would accept the self-employed workers as union members, excluding membership in the unemployment fund, which is administrated by the trade unions. The unions have recently started to safeguard the interests of self-employed workers and are more and more often approving them as members in their unemployment fund, although the number of this kind of members is as yet small.

The Confederation of Unions for Professionals (Akateemisten Toimihenkilöiden Keskusjärjestö, AKAVA) has a total number of 20,000 self-employed workers which is about 4 % of the total membership of Akava. The Confederation of Salaried Employees (Toimihenkilökeskusjärjestö, STTK) has about 12,000 (2 % of total membership) self-employed workers; and the Central Organisation of Finnish Trade Unions (Suomen Ammattijärjestöjen Keskusliitto, SAK) has about 8,000 (0,7 % of total membership) self-employed members.

One of the most active individual trade unions and forerunner in this matter has been the SAK-affiliated Service Union United PAM (Palvelualojen Ammattiliitto PAM) which is a union for employees working in the private service sectors. PAM is the second largest union in Finland, having more than 200,000 members of which 80 % are women. The majority of its members work in retail shops, hotels and restaurants, cleaning, property services and as guards. PAM has been persuaded by the fact that self-employed sole traders often have similar problems to those of employees, and that such workers can also benefit in many ways from union membership. PAM has provided explicitly for self-employed members to organise within the union. PAM has about 4,000 members categorised as self-employed workers, mostly working as barbers and cleaners.

Until now, the centralised Finnish bargaining system has not included any specific representation of small and medium-sized enterprises. Instead, many SMEs have been organised in the Federation of Finnish Enterprises (Suomen Yrittäjät, SY), which has no negotiation rights in bargaining over national incomes policy agreements. Recently, Suomen Yrittäjät has tried to achieve the status of a central social partner organisation with negotiation rights.

6. NC Commentary

Self-employed workers without employees are quite a new phenomenon, at least in the field of work research. There are only a few studies focusing on the working conditions of self-employed workers, even though the number of self-employed workers has increased from 123,000 to 141,000 since 2000.

The results of the study “Involuntary entrepreneurship” (2007) indicated that the phenomenon appeared to be of marginal importance in the Finnish SME population as a whole. However, it is possible that involuntary self-employment is a serious issue in certain sectoral niches which remain “hidden” in broad cross-sectoral samplings. Further research is required regarding the social and economic consequences of involuntary entrepreneurship.

REFERENCES

Akola, Elisa et al. Työn ja toimeentulon rakentuminen eri ammateissa 2000-luvun Suomessa. Yrittäjyyden ja palkkatyön rajapinnalla? At the boundaries between entrepreneurship and waged work? Organising work and livelihood in different professions in the 21th century in Finland. (in Finnish only). Työpoliittinen tutkimus 326. Työministeriö. Helsinki 2007.

Hyytinen, Ari - Ruuskanen, Olli-Pekka: What Makes An Entrepreneur Independent? Evidence From Time Use Survey. ETLA, Helsinki 2006.

Kautonen, Teemu (ed.). Involuntary entrepreneurship. (In Finnish only. Vastentahtoinen yrittäjyys). Työpoliittinen tutkimus 327. Työministeriö. Helsinki 2007.

Stenholm, Pekka: Starttrahalla yrittäjyyteen – Kokemuksia starttirahakokeilusta. With help of the start-up grant to entrepreneurship – Experiences from the start-up grant trial. (in Finnish only) Työpoliittinen tutkimus 320. Työministeriö. Helsinki 2006.

Yrittäjien sosiaaliturva 2004 −työryhmän raportti. The social security of entrepreneurs –report of working group. (in Finnish only). Sosiaali- ja terveysministeriön työryhmämuistioita 12/2005. SOSIAALI- JA TERVEYSMINISTERIÖ, Helsinki 2005.

Pertti Jokivuori, Statistics Finland / University of JyväskyläArto Miettinen, Statistics Finland

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