Notice period for lay-offs and the duration of co-operation negotiations will be temporarily shortened

31.3.2020

The amendments to the Employment Contracts Act, the Seafarers’ Employment Contracts Act and the Act on Co-operation within Undertakings will be in force from 1 April to 30 June 2020. The aim is to allow employers to adapt their activities more quickly in a situation where the coronavirus epidemic has suddenly and dramatically weakened the demand for products and services.

  • The notice period for lay-offs is shortened: employers will be required to inform employees of the lay-off no later than five days before the lay-off begins.
  • The duration of co-operation negotiations on lay-offs is shortened: the duration of the negotiations will be at least five days.
  • Employees on a fixed-term contract may be laid off: employers will have the right to lay off an employee in a fixed-term employment relationship under the same conditions as an employee with an employment contract of unspecified duration.
  • Termination of employment during trial period permitted: the employer may terminate the employment contract during the trial period for financial or production-related reasons.
  • Employee re-employment obligation extended: the employer will be obligated, for a period of nine months, to re-employ those employees who were dismissed for financial or production-related reasons between 1 April and 30 June.

To the extent that the national collective agreement provides for minimum negotiation periods that are longer or shorter than five days, the negotiation and lay-off notice periods laid down in the collective agreement shall apply. The same applies to the provisions of collective agreements on re-employment obligation. The changes that reflect the new, temporary provisions, have already been made to about 90 per cent of the collective agreements.

The shorter notice periods for lay-offs will affect the livelihoods of wage and salary earners. The Ministry of Social Affairs and Health is currently preparing a government proposal to safeguard the livelihoods of employees during lay-off, among other things. More information on the submission of the proposal will be provided separately. In addition, a temporary amendment to the Unemployment Security Act will enter into force on 1 April 2020 that will extend employees’ right to unemployment benefit during lay-off. Those laid off will be entitled to unemployment benefit even if they are engaged in business activities or studies.

More information

Notice period for lay-offs and the duration of co-operation negotiations will be temporarily shortened 31.3.20202 (tem.fi)