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Union confederations accept gov't compromise on firing law--with conditions

Labour confederations have welcomed a government compromise proposal, and said they are ready to suspend industrial action called in protest.

SAK:n puheenjohtaja Jarkko Eloranta
Head of the blue-collar confederation SAK, Jarkko Eloranta. Image: Yle

Trade union confederations have welcomed a government proposal to water down a law designed to ease the rules on firing workers in small companies, saying that it could create the conditions for individual unions to suspend strikes called to protest the measure.

Strikes and industrial action had spread across different sectors of the economy in protest at the proposed law, forcing a government climbdown.

The leaders of the three big labour confederations all said their agreement was conditional on tripartite negotiations including government, union and employer representations. That tripartite bargaining has traditionally set terms and conditions for workers across the Finnish economy, but has come under pressure in recent years as the centre-right government of Juha Sipilä has tried to act in the face of union opposition.

After afternoon meetings with their respective boards in Helsinki, they each emerged to tell the waiting media that the compromise could allow protest strikes to be suspended, but each individual union must decide for themselves on calling off their action.

On Friday afternoon the government issued a statement welcoming the unions' response, saying they would invite labour representatives to discuss the government's proposals next week.

Activation model up for discussion

The government had proposed to change plans to weaken employment protections for workers in small firms, and invite unions to join discussions about the so-called 'activation model' which had reduced benefits for unemployed people if they did not find work or training.

Unions and claimants had said the activation model was unfair as in some regions there are simply not enough training places or jobs to meet demand.

Professional workers' confederation Akava was the first to give the proposal the thumbs-up, with white collar STTK following suit a short time later. Both said that the proposal should be developed in discussions with labour market organisations representing employers and employees, consistent with Finland's tradition of tripartite wage bargaining.

Blue-collar SAK leader Jarkko Eloranta said that his unions wanted to include possible reasons for dismissal in the legislation.

That's a key demand for the Finnish labour movement, which has stridently opposed any efforts by the government to legislate on employment law without their input.

Unions take umbrage

Unions had taken umbrage at government plans to make it easier for small firms to fire employees. The first proposal said firms with fewer than twenty workers should get easier rules around dismissals, with that number then reduced to 10 as the recent wave of strikes got going.

Industrial actions hit transport and services, in particular meals for schools and daycare centres.

Government had claimed that the proposed adjustments would create thousands of jobs, as firms became less cautious about hiring new workers. That claim was disputed by unions and many economists.

"100 times better"

The government on Thursday proposed that it would remove the number altogether, with courts merely advised to take into account the number of employees in a firm when deciding on wrongful dismissal cases.

The new proposal had been welcomed by Seppo Koskinen, a professor of employment law, who said it was ‘a hundred times’ better than the previous proposal and would result in fewer disputes.

The Federation of Finnish Enterprises had sharply criticised unions and on strike days encouraged members to offer free food to schoolchildren, while insisting on measures to ease what they call red tape around employment in Finland. The federation also proposed that the first day of sick pay should be unpaid, to reduce the burden for Finnish employers.

As the dispute continued it became a lightning rod for discussion about Finland’s labour market, with Nobel laureate Bengt Holmström criticising the power of the unions and suggesting that immigrants have lower minimum wages to encourage their employment.

That proposal was momentarily welcomed by Sture Fjäder, who leads the professional union confederation Akava, prompting much criticism from his member unions. He could now face tougher opposition if he seeks re-election to his post.

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