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Government submits 'Nordic Model' employment services draft bill to Parliament

Under the proposed changes, jobseekers would meet with an employment specialist every two weeks and would be expected to submit an average of one job application every week.

Hakemuspohja tietokoneen näytöllä
The proposal, if passed into law, could lead to about 14 million job applications being sent every year. Image: Nadja Mikkonen / Yle

The government has submitted to Parliament a proposal to introduce a 'Nordic model' of providing employment services in Finland, which would require jobseekers to submit an average of one job application per week or four per month.

This could lead to about 14 million job applications being submitted every year, according to the draft proposal's estimates.

Speaking at a press conference announcing the proposal, Minister for Economic Affairs and Employment Tuula Haatainen (SDP) said she is not concerned that the proposed changes would lead to an 'application conveyor belt'.

"We trust the person knows what kind of jobs they are applying for," Haatainen said, adding that jobseekers should apply for jobs they could reasonably assume to get.

Exceptions to the quota of job applications could be made, for example if the jobseeker’s working capacity had deteriorated or there were very few vacancies available in the area.

However, failure without reasonable cause to fulfil the quota of applications could result in the jobseeker temporarily losing unemployment benefits. Actively looking for employment has always been a condition for receiving the benefit, but the 'Nordic model' proposed by the government would provide a "more reasonable" system of sanctions.

In practice, this would mean that the jobseeker would receive a "reminder" after the first incidence of failing to submit the requisite number of applications, followed by a 5 day sanction for the second occurrence and 10 days for the third.

The draft law also recommends shortening existing sanction periods. For example, if a jobseeker refuses a job offer, the sanction period would be halved to 45 days. Currently, sanction periods for refusing a job offer can last between 15 and 90 days depending on the circumstances.

The Confederation of Finnish Industries (EK) has criticised the proposed changes to the current system of sanctions, citing concerns that state expenditure on unemployment benefits will increase.

The draft proposal's own estimate suggests that the change could lead to the government spending an additional 33 million euros every year on unemployment benefits.

Meetings with specialists every two weeks

The reform also proposes increasing support for jobseekers, including the introduction of a provision for a jobseeker to have a meeting with a specialist within five working days of the start of their job search. Currently the time period for that first meeting is within two weeks.

Following this first meeting, the jobseeker would then meet a specialist from either the local TE-office or participating municipality every two weeks for a period of three months.

"During the meetings, the jobseekers’ need for services, their skills and ability to look for work would be individually assessed. If the skills to look for work or to be employed were found to be lacking, the jobseeker would get access to services quicker," the draft proposal outlines, adding that this would lead to an estimated 2.3 million appointments per year for jobseekers.

Currently, about one million such meetings are held per year.

The draft model therefore proposes hiring about 1,000 new employees for TE-offices and municipalities, at an additional cost to the state of an estimated 70 million euros. If this provision is passed into law, staff numbers at TE-offices would increase by about 40 percent.

Story continues after the photo.

Työministeri Tuula Haatainen.
Minister for Economic Affairs and Employment Tuula Haatainen of the Social Democratic Party. Image: Jorge Gonzalez / Yle
The proposal is one of the largest employment measures undertaken by the current government, and aims to increase employment by about 9,500 to 10,000 people by the beginning of 2025.

This figure does not include the 1,000 new TE-offices employees required to support jobseekers.

Draft bill raises questions

However, the Council of Regulatory Impact Analysis, which aims to improve the quality of government draft bills, has queried a number of the claims made in the proposal.

For example, the council requested a more detailed breakdown of exactly how the reform would save an estimated 140 million euros per year in public expenditure, as promised in the draft proposal.

The Ministry of Economic Affairs and Employment told news agency STT that small technical additions were made to the draft bill on the basis of the council's feedback.

If the proposal is passed into law, the changes are scheduled to come into effect from May next year.

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