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COVID-19 EU PolicyWatch

Database of national-level responses

Eurofound's COVID-19 EU PolicyWatch collates information on the responses of government and social partners to the crisis, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for case FI-2020-14/258 Updated – measures in Finland

Temporarily shortened duration of employer-employee negotiations on temporary layoffs

Lomautusta koskevien yhteistoimintaneuvottelujen keston väliaikainen lyhennys

Country Finland , applies nationwide
Time period Temporary, 01 April 2020 – 30 June 2020
Type Legislations or other statutory regulations
Category Promoting the economic, labour market and social recovery
– Flexibilisation and security
Author Amanda Kinnunen (Oxford Research) and Eurofound
Case created 03 April 2020 (updated 10 July 2020)
Related ERM support instrument

Background information

In Finland, employers with a staff of at least 20 people must commence employee-employer negotiations (yhteistoimintamenettely) if the employer plans to temporarily lay-off staff. This duty is regulated in the Act on Co-operation within Undertakings (334/2007).

The duration of employer-employee negotiations on temporary lay-offs is shortened from six weeks or 14 days to five days in order to facilitate fast adaptation of businesses to the new circumstances and the decreased potential to offer job for employees.

Content of measure

All undertakings that are covered by Act on Co-operation within Undertakings (334/2007) are in the scope of this measure. In Finland, personal may be laid off when the potential of the employer to offer work to its personal has diminished (either temporarily or permanently) and the employer cannot provide the employee with other suitable work or training.

This measure is not applicable to the following employers: the State, municipalities, KELA, Åland Government, Evangelical Lutheran Church or Orthodox Church.

There are no direct monetary aspects involved in this measure. However, considering that during employee-employer negotiations companies must pay employees salary whereas during lay-offs the state and unemployment funds pay out unemployment allowance (or labour market subsidy) for employees, the shortened duration of employer-employee negotiations has significant financial benefits for companies.

Updates

The following updates to this measure have been made after it came into effect.

06 July 2020

In May 2020, the peak-level social partners proposed to the Government that the duration of the COVID-19 related temporary amendments to labour law, including the temporarily shortened duration of employer-employee negotiations in the case of temporary lay off, should be extended until the end of 2020.

In June 2020, the Parliament accepted the Government's proposal to extend the duration of this temporary amendments until the end of 2020.

Use of measure

No information to this date.

Target groups

Workers Businesses Citizens
Employees in standard employment
Does not apply to businesses Does not apply to citizens

Actors and funding

Actors Funding
National government
Social partners jointly
No special funding required

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Consulted Consulted
Form Any other form of consultation, institutionalised (as stable working groups or committees) or informal Any other form of consultation, institutionalised (as stable working groups or committees) or informal

Social partners' role in the implementation, monitoring and assessment phase:

  • Unknown
  • Main level of involvement: Peak or cross-sectoral level

Involvement

In March 2020, the peak-level social partners jointly proposed a set of actions for the Finnish Government. These proposed measures include amendments to labour law. They seek to facilitate adaptation of businesses to the new circumstances and support employees who have been either temporarily or permanently laid off. Shortening the negotiation period on temporary lay-offs was part of the proposed measures.

In May 2020, the peak-level social partners jointly proposed to the Government that the duration of the measures that support employees and employers should be extended until the end of 2020.

Views and reactions

The peak-level social partners stress that this measure is part of the wider package of measures (proposed by them in March 2020) and amendments to labour law that include both measures that facilitate adaptation of businesses to the new market situation but also measures that support employees who are being either temporarily or permanently dismissed.

Sources

  • 10 April 2019: European Monitoring Center on Change - Finland: temporary lay off (www.eurofound.europa.eu)
  • 20 March 2020: Social partners’ proposals to help businesses in the corona crisis (akava.fi)
  • 26 March 2020: Notice period for temporary lay-offs and the duration of co-operation negotiations will be shortened due to COVID-19 (tem.fi)
  • 30 March 2020: Notice period for lay-offs and the duration of co-operation negotiations will be temporarily shortened (tem.fi)
  • 14 May 2020: Labor market organizations agree on layoffs and unemployment security (Työmarkkinakeskusjärjestöt sopuun lomautuksista ja työttömyysturvasta) (ek.fi)
  • 05 June 2020: Government proposal HE 92/2020 vp (Hallituksen esitys HE 92/2020 vp) (www.eduskunta.fi)
  • 23 June 2020: Measures that have brought security and flexibility to labour markets during coronavirus epidemic will be extended (Jatkoa toimille, joilla on tuotu turvaa ja joustoa työmarkkinoille korona-aikana) (tem.fi)

Citation

Eurofound (2020), Temporarily shortened duration of employer-employee negotiations on temporary layoffs, case FI-2020-14/258 (measures in Finland), COVID-19 EU PolicyWatch, Dublin, http://eurofound.link/covid19eupolicywatch

Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process. All information is preliminary and subject to change.