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Temporary amendments to labour legislation take effect on 1 April 2020

  • Finland

    02-04-2020

    Temporary amendments to the Employment Contracts Act, the Seafarers’ Employment Contracts Act and the Act on Co-operation within Undertakings will take effect on 1 April 2020 and the amendments will be in force until 30 June 2020. On 30 March 2020, the Finnish Parliament approved the Government proposal regarding the amendments and the President approved the proposals on 31 March 2020.

    Flexibility is added to labour legislation until 30 June 2020

    • The minimum negotiation times regulated in the Act on Co-operation within Undertakings are shortened from the current 14 days or 6 weeks to 5 days in the event of lay-offs.

    • The legislative amendments to the Act on Co-operation within Undertakings are in force from 1 April to 30 June 2020.

    • If co-operation negotiations regarding lay-offs are still ongoing when the legislative amendments take effect, the employer has fulfilled its negotiation obligation when the negotiations have continued for a period of 5 days, unless otherwise agreed in the co-operation negotiations.

    • If co-operation negotiations regarding lay-offs have been commenced during the validity of the legislative amendments and negotiations are continuing after the amendments are no longer effective, the employer has fulfilled its negotiation obligation when the negotiations have continued for a period of 5 days, unless otherwise agreed in the co-operation negotiations.

    • The right to lay off is extended to apply to all fixed-term employment contracts. However, in the public sector (the State, Provincial Government of Åland, municipality or joint municipal authority) employees in a fixed-term employment relationship may be laid off only, if the employee is working as a substitute for a permanent employee and the employer would be permitted to lay off the permanent employee if he/she was working.

    • Provision regarding the right to lay off an employee in a fixed-term employment relationship can be applied to lay-offs that continue after the legislative amendments are no longer valid provided that the lay-offs have begun during the validity of the amendments.

    • The 14 days’ notice period for lay-offs regulated in the Employment Contracts Act is shortened to 5 days. However, in the public sector the notice period for lay-offs is 14 days.

    • An employer who has given an employee a lay-off notice before the legislative amendments take effect, may lay off the employee provided that at least 5 days have elapsed from the moment when the lay-off notice was notified to the employee. The precondition is that the employer must inform the employee of the shortened lay-off notice period at least a day before the commencement of the lay-off.

    • An employer who has given an employee a lay-off notice during the validity of the legislative amendments may lay off the employee by observing the 5 days’ notice period for lay-off even if the legislative amendments would no longer be effective at the time when the lay-off would commence.

    • The employers are allowed to terminate an employment relationship on a trial period due to financial and production related grounds. This exception is not applicable to the public sector.

    • The obligation to re-employ an employee is extended to 9 months instead of the current 4 or 6 months, if the employment relationship has been terminated during the temporary changes to the employment legislation. In the public sector, the re-employment obligation is 4 or 6 months.

    • The amended re-employment obligation is applicable when the employment relationship has been terminated during the validity of the amendments.

    • Applicable collective agreements may contain deviating provisions i.e. longer or shorter negotiation times or lay-off notice periods which must be applied instead of the amended legislation.

    Securing the unemployment benefits temporarily

    • A government proposal to secure the livelihood of laid off employees is currently prepared. There is no specific date of the submission of the proposal yet.

    • On 1 April 2020 a temporary amendment to the Unemployment Security Act entered into force. The amendment extends employees’ right to unemployment benefit during lay-off so that laid off employees are entitled to unemployment benefit even if they are engaged in business activities or studies.

    For more information contact

    Timo Jarmas, Partner
    Sanna Soukko, Senior Associate

    Disclaimer

    This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full terms and conditions on our website.

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