Labour Research January 2016

European news

Finnish employer-union talks break down

Talks between unions and employers in Finland, aimed at finding an alternative to new government legislation to cut labour costs, have collapsed. The failure of the negotiations, which broke down on 2 December, makes it more likely that the government will attempt to press ahead with its own proposals.

The government has been pushing for a 5% cut in unit labour costs to increase the country’s competitiveness since shortly after it was elected in May 2015. In September, it came forward with a series of specific proposals. 

These included cuts in overtime pay, sick leave and some public holidays. Following union protests, the government slightly altered its plans. However, since that time, unions and employers have been discussing alternative ways to achieve the savings, including proposals from the unions allowing for greater flexibility in dealing with holiday pay, as well as a pay freeze for 2017. These talks have now ended following the withdrawal of the Finnish employers’ association EK.

The EK is now calling on the government to represent its package of measures quickly so that they can be in place before the start of the next bargaining round in 2016. It has also indicated that it will no longer be involved in centralised negotiations trying to set pay for the whole country.

The unions continue to oppose the government’s plans.