Direct Request (CEACR) - adopted 2023, published 112nd ILC session (2024)

Termination of Employment Convention, 1982 (No. 158) - Finland (Ratification: 1992)

Other comments on C158

Observation

Direct Request

2023
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The Committee notes the observations of the Federation of Finnish Enterprises (SY) and of the Confederation of Finnish Industries (EK) which were transmitted with the Government’s report received in 2021.

Article 2(2) of the Convention. Workers serving a period of probation. With reference to its previous comments, the Committee notes that the Employment Contracts Act (55/2001) was amended several times in the period 2016–20, including by an Amendment Act (1458/2016), in force since 1 January 2017, which extended the maximum duration of trial periods in employment relationships from four to six months (chapter 1, section 4 of the Employment Contracts Act). The Government states that the reform aims at lowering the employment threshold, by allowing employers to assess the suitability of employees for a longer period. The Government adds that a shorter probation period may be provided, including through the application of a collective agreement. If a collective agreement provides for the duration of the trial period in the employment relationship, the employer must provide this information to the employee at the time of the conclusion of the contract, failing which the employer may not terminate the contract with immediate effect during the trial period. The Government also indicates that, should an employee be absent during the trial period, due to incapacity for work or family leave, the employer may extend the trial period by one month for every 30 calendar days of absence. The employer must notify the employee of the extension of the trial period before its ending. In their observations, the SY and the EK welcome the reform brought by the Amendment Act (1458/2016). The Committee requests the Government to continue to provide general information on legislative developments relevant to the application of the Convention. The Committee also requests the Government to provide information on the impact of the Amendment Act (1458/2016) on the rate of termination of employment contracts during periods of probation and to specify the way in which the judiciary has handled cases related to the termination of employment of workers during the probation period.

Article 2(2) and (3). Adequate safeguards against recourse to fixed-term employment contracts. As regards reforms facilitating the use of fixed-term employment, the Government indicates that, according to the Amendment (1448/2016) to the Employment Contracts Act, in force since 1 January 2017, employers are allowed to conclude fixed-term employment contracts without a valid reason, provided that the newly hired person has been an unemployed jobseeker during 12 uninterrupted months prior to the hiring (chapter 1, section 3(a)). The maximum duration of fixed-term contracts concluded with long-term unemployed jobseekers is limited to one year. The Act on Public Business and Employment Service (916/2012) provides a definition of “unemployed jobseeker”. In their observations, the SY and the EK welcome the reform brought by the Amendment Act 1448/2016. The Committee further notes the Government’s indications according to which the 2013 amendments aimed at improving the employees’ rights by requiring employers to provide information on the estimated termination date of fixed-term contracts. The Government does not provide information on the impact of such amendments in practice. The Committee requests the Government to indicate whether, beyond the limitation in time of the fixed-term contracts, other safeguards have been put in place with a view to avoiding the use of contracts of employment for a specified period of time the aim of which is to avoid the protection resulting from the Convention. It also requests the Government to provide information on the impact of this measure on the employment of long-term unemployed jobseekers. Furthermore, the Committee requests the Government to indicate whether a maximum length of use of fixed-term contracts is contemplated for workers other than long-term unemployed jobseekers. Finally, the Committee reiterates its request to provide information regarding the impact of the 2013 amendments to the Employment Contracts Act on the use of fixed-term contracts.

Article 4. Valid reason for termination. The Committee notes the Government’s indication that the Amendment (No. 127/2019) to the Employment Contracts Act, entered into force on 1 July 2019, requires considering the number of employees of the employer when assessing the appropriateness of the termination of an employment contract (chapter 7, section 2). The Government indicates that this reform aims at taking into account that small employers are less able to withstand the consequences of an employee’s misconduct. The Committee also notes the observations from the SY according to which the lack of clarity regarding the valid grounds of termination poses important legal and financial risks for the employers. The Committee further takes note of the EK’s concerns that the reform may not have a significant impact on the validity of terminations. The Committee observes that the Convention subjects the termination of employment to the condition that there is a valid reason for such termination either connected with the capacity or conduct of the worker or based on the operational requirements of the undertaking, establishment or service. In the present case, the Committee notes that the fact that the national legislation enables differentiation according to the size of the enterprise in order to determine the validity of a termination corresponds to the possibility in the Convention to base the termination on the operational requirement of each specific undertaking. The Committee nonetheless requests the Government to provide complementary information on the impact of the Amendment Act (No. 127/2019) on the validity of terminations and potential developments as to the grounds considered valid taking into account the size of the enterprise, including examples issued from judicial decisions in that regard. Noting the comments made by SY and EK, the Committee invites the Government to supply information on measures taken or envisaged with a view to introducing greater legal clarity and certainty in the national legislation as regards what constitutes valid reasons for termination. In addition, it requests the Government to provide an updated copy of the Employment Contracts Act (incorporating amendments made after 2018).

Article 13. Consultation of workers’ representatives concerning termination of employment for economic, technological, structural, or similar reasons. As regards the operation of the consultation mechanisms on termination of employment, the Government refers to an ongoing comprehensive reform of the Act on Co-operation within Undertakings (Co-operation Act), which aims at enhancing the role of workers’ representatives in negotiations, particularly concerning decisions that significantly affect employees, such as reductions in workforce. The Committee notes the observations from the SY according to which, as it stands, the Co-operation Act does not fulfil its purpose of promoting co-operation among workers and employers. The Committee also takes note of the EK’s observations according to which the reform of the Co-operation Act does not provide for the flexibility that is needed to improve the cooperation between employers and workers. The Committee notes that the New Co-operation Act (1333/2021) entered into force on 1 January 2022. The Committee requests the Government to provide an assessment of the impact of the New Co-operation Act regarding the consultation of workers’ representatives in relation to the termination of employment for economic, technological, structural, or similar reasons.

Mitigating the effects of termination of employment for economic, technological, structural or similar reasons. The Committee notes the Government’s indication that, following the entry into force on 1 January 2017 of the Amendment (1448/2016) to the Employment Contracts Act, the duration of the obligation for employers to rehire their former employees who had been given notice for economic or production-related reasons, when new employees are needed for the same or similar work, is reduced from six to four months (chapter 6, section 6). This reform does not apply if the employment relationship had lasted for at least 12 years prior to termination. The Committee requests the Government to provide information on the impact of amendment on the rate of re-employment after dismissals for economic, technological, structural, or similar reasons. The Committee also requests the Government to indicate whether there are mechanisms whereby workers’ representatives may be involved in facilitating such re-hirings.

Application of the Convention in practice. As regards the application of the Convention in practice, the Government indicates that, in the period 2017–20, the number of cases lodged in relation to the termination of employment contracts declined regarding cases in the district courts (557 cases in 2017 and 463 cases in 2020) as well as cases in the Supreme Court (5 cases in 2017 and 1 case in 2020), while remaining the same regarding the Court of Appeals (84 cases) and the Labour Court (2 cases). The Committee also notes that the number of terminations based on financial or production-related grounds increased during the period 2016–20 (43,488 terminations in 2016 versus 46,140 terminations in 2020). The Government indicates that statistics on the outcomes of the appeals against unjustified dismissals are not available. The Committee requests the Government to continue to provide updated information on the manner in which the Convention is applied in practice, including statistics on the activities of the bodies of appeal (such as the number of appeals against unjustified dismissals, the outcome of these appeals, the nature of the remedy, the average time taken for deciding an appeal) and the number of terminations for economic or similar reasons. The Committee further asks the Government to indicate potential practical difficulties encountered in the implementation of the Convention, and measures taken or contemplated in this regard.