Temporary changes in regulations governing layoff (furlough) and other terms and conditions of employment

Updated on 3 January, 2021.

Are the temporary changes to the law on furlough still in force?

Unless otherwise provided in a collective bargaining agreement, the temporary amendments introduced in the spring to the law governing furlough procedures expired at the end of December 2020. The normal procedure is accordingly restored for private sector redundancies:

  • with the minimum furlough negotiation periods under the Co-operation Act returning to 14 days or 6 weeks instead of the exceptional 5 days.
  • with the employer’s right of furlough no longer governing temporary employment contracts to the same extent as open-ended employment contracts.
  • with a requirement to notify the employee of a furlough at least 14 days in advance (one month in advance in the municipal sector), whereas the notice period was 5 days under the temporary amendment.

The temporary changes did not apply to employees in local and central government, the Social Insurance Institution of Finland nor the Evangelical Lutheran and the Orthodox Churches in Finland.

Can a laid-off employee study or engage in self-employment during the lay-off?

A furloughed employee may exceptionally receive unemployment benefit until 31 December 2021, even though studying during the furlough. Normal employment policy conditions will otherwise again apply to employees who are furloughed at the beginning of 2021, meaning that a furloughed employee must, for example, accept any job or service offered by the TE Office and participate in preparing an employment plan. The TE Office will also investigate whether any self-employed activities of a furloughed employee constitute a main or secondary occupation, and will issue a decision on eligibility for unemployment benefit accordingly.

Are the temporary changes to the provisions on the trial period and the obligation to re-employ still in force?

No they are not. A five-day waiting period for unemployment benefit applies again for all such periods beginning after 31 December 2020. No unemployment benefit is payable for this initial waiting period.

The exceptional three-month employment and fund membership condition for earnings-related unemployment benefit returns to six months for all earnings-related daily allowance payments beginning after 31 December 2020. The employment condition means that eligible jobseekers must have been adequately employed for at least 26 weeks during the preceding 28 months. Payment of earnings-related daily allowance also requires the jobseeker to be a member of the unemployment fund for at least six months before the onset of unemployment.

What was the basis for the temporary changes in regulations governing layoff and other terms and conditions of employment?

The coronavirus crisis package negotiated by the labour market organisations proposed several measures to the Government that can be used to secure the livelihood of people and the continuation of businesses in this difficult situation. The Government took action on the proposals, and amendments to acts entered into force on 1 April. The changes were in force until 31 December.

Several proposals in the labour market organisations’ crisis package were carried out through temporary changes to collective labour agreements.