Finland’s collective dismissal protection in line with the European Social Charter
Ministry for Foreign Affairs
Ministry of Economic Affairs and Employment
The European Committee of Social Rights published a decision on 31 January 2017 stating that the protection against collective dismissals included in the Finnish legislation is in line with the European Social Charter. The Committee, operating under the Council of Europe, stated that the Finnish legislation creates a sufficient balance between the employer’s right to manage and the workers’ need for protection. The financial and production-related grounds for termination referred to in chapter 7, section 3 of the current Employment Contracts Act are in line with Article 24 of the revised European Social Charter. The Council of Europe Committee of Ministers has discussed the decision and confirmed it unanimously.
As regards the adequate compensation payable to workers whose employment is terminated without a valid reason, the European Committee of Social Rights stated in its second decision published on 31 January 2017 that Article 24 of the European Social Charter does not allow the limiting of the maximum amount of compensation. The Committee further stated that in addition to compensation the Finnish act should also allow the possibility for reinstatement of employment. Next the Committee’s decision will be discussed in the Council of Europe Committee of Ministers.
Two collective complaints had been lodged against Finland stating that the Finnish legislation does not comply with Article 24 of the revised European Social Charter with regard to termination of employment. According to Article 24 of the revised European Social Charter, employment cannot be terminated without valid reason. The valid reason can, for example, be connected with the operational requirements of the undertaking, establishment or service. The article further provides that workers whose employment is terminated without a valid reason have the right to adequate compensation or other appropriate relief.
The European Social Charter is an international agreement safeguarding social rights in Europe. States Parties are bound to guarantee respect of the Charter rights to all people within their jurisdiction without discrimination. Compliance with the Charter is monitored under two mechanisms: through national reports draw up by the States Parties and through collective complaints lodged by social partners and other non-governmental organisations to the European Committee of Social Rights for rulings on possible non-implementation of the Charter.
Katja Kuuppelomäki, Senior Officer for Legislative Affairs, Ministry for Foreign Affairs, tel. +358 29 535 1175
Anne-Mari Mäkinen, Administrator, Legal Affairs, Ministry of Economic Affairs and Employment, tfn 029 504 7202