SAK proposes rapid boost to Finnish competitiveness

The arrangements proposed by SAK on Thursday are an alternative to the package of mandatory legal reforms announced by the government of Prime Minister Juha Sipilä a couple of weeks ago, seeking to cut business labour costs by undermining terms and conditions of employment.

"SAK will give the employers an opportunity to agree a wage freeze for 2017, with export sectors setting the ceiling pay for increases in 2018," SAK President Lauri Lyly explains.

The mandatory legislative proposals announced by the government will have an unjust impact on employees who are already experiencing hardship. They are also questionable under the Finnish constitution, and their implementation would cause serious industrial unrest.

"The proposals of SAK will rapidly improve employment and competitiveness, and represent a more equitable approach than those of the government. They will also cause no damage to terms and conditions of employment. The government will have to abandon its mandatory legislative proposal if a negotiated settlement emerges," Lyly adds.

SAK is willing to see cuts in employer contributions, coupled with a moderate increase in the contribution share of employees. This would assign greater responsibility for financing earnings-related unemployment benefits to people in work. SAK is also calling for less severe cuts in unemployment benefit.

SAK likewise insists that businesses must reinvest the proceeds of their improving viability in Finland.

"Salary settlements in 2018 will also interpret the payroll assets of the export sector on the basis of dividend payments made to shareholders. There can be no question of extreme pay restraint if businesses have paid excessive dividends," Lyly insists.

The SAK President stresses that the willingness of employer organisations to negotiate will be highly significant for resolving the overall situation, as the government will be expecting a joint proposal from the labour market.

"The labour market organisations could agree on an alternative package in October," Lyly suggests.

Meeting on Thursday, the Executive Board of SAK also called on the Sipilä government to prepare reforms in unemployment benefit, local collective bargaining and general working conditions by actively negotiating with the labour market, and not merely by hearing its views. The government should likewise allocate greater resources and practical measures to combating the grey economy.