Cooperation negotiations (yt-neuvottelut)
Before deciding to reduce a workforce, an employer is required to hold cooperation negotiations. Reducing the workforce means dismissals, temporary lay-offs and shifts to part-time work due to economic or production-related reasons.
In Finnish, cooperation negotiations are called yhteistoimintaneuvottelut or more commonly referred to as yt-neuvottelut.
Always take time to carefully read any contracts before signing. Have the TEK lawyers check the contract or an individual package offer before signing.
Different stages of the negotiation process
1. The Employer notifies the start of cooperation negotiations
When are cooperation negotiations held?
The cooperation negotiations come under the Co-operation Act and affects companies with at least 20 employees. Before an employer decides to reduce the workforce, the employer needs to hold cooperation negotiations. Reducing the workforce means dismissals, temporary lay-offs and shifts to part-time work due to economic or production-related reasons.
The Co-Operation Act also requires negotiations on issues other than those related to reducing workforce; however, these instructions will only focus on staff reduction situations.
The parties involved in these negotiations are the employer and, usually, either employee representatives or delegates as representatives of the personnel.
In practice, cooperation negotiations starts with a negotiation proposal drafted by the employer. The employer should give a written negotiation proposal on launching negotiations and employment procedures at least five calendar days before starting the negotiations. During this time, the representatives of the employees have the opportunity to prepare for the negotiations. This time is not added to the actual negotiation time unless otherwise agreed in the collective agreement.
You have a right to ask to see the employer’s notification on starting cooperation negotiations. The notification will state who the negotiations will affect, why the negotiations are being held and what may be expected.
What to do when facing cooperation negotiations?
- Make sure you have an employee representative who will attend the cooperation negotiations.
- If possible, discuss the situation with the employee representative and, together, familiarise yourselves with the information and reasons for the cooperation process given in the negotiation proposal. If the information given by the employer is not sufficient, ask the employer for additional information before starting the negotiations.
- If you have any concerns or questions about the negotiation proposal or the initiation of the negotiations, first contact your employee representative or TEK.
- Think about how the situation might affect you. If the negotiations apply to you, think about preparing yourself, for example, for temporary lay-off or even dismissal.
When the negotiations only concern one employee
One employee’s dismissal, temporary lay-off or shift to part-time work can be handled between the employer and the employee. In these cases, the employee always has the right to demand that a matter concerning them must be negotiated between their employee representative and the employer. TEK recommends that a member facing individual negotiations informs their employee representative about the negotiations and bring their representative to the negotiations.
2. Conducting the negotiations
The purpose of negotiations
Genuine dialogue between the employer and the employee side should occur during the negotiations. The employees should have a real opportunity to impact on the decisions within the general framework in the Co-operation Act. This requires that the employees are given sufficient information and have an opportunity to present their opinions, information and experiences.
It is important that the negotiations are carried out in proper time so that the employee representatives can still affect the decision.
A record should be kept by the employer of the negotiations, as this record is used to evaluate if the negotiations have met all the requirements. The employee representatives should always ask if the record is kept.
Options should be discussed
The topics that need to be discussed include the grounds for and effects of the reductions, plan for operations or operating principles and options for reducing workforce and limiting the impact on the employees. It is also important to negotiate on the possibilities for limiting the amount of reduced workforce.
The aim of the cooperation procedure should be to minimise the impact on the employees and to find a way to avoid temporary lay-offs and dismissals. The issues handled in the negotiations are, for example, opportunities for retraining, positions, relocation and working time arrangements. If the reduction of workforce (e.g. dismissals, temporary lay-offs and shifts to part-time work) cannot be avoided, cooperation negotiations should discuss options to limit the social and financial harm for the employees.
The law on cooperation obligates the employer to negotiate with the employees, but, unfortunately, does not require reaching a mutual understanding on the end result. The employer always has the opportunity to unilaterally make decisions on temporary lay-offs and dismissals.
The minimum time for the negotiations is either 14 days or 6 weeks. The length of the negotiation time depends on the number of those being dismissed, temporarily laid off or transferred to part-time work and the duration of the temporary lay-off.
- The dismissals, temporary lay-offs or transfers to part-time work proposed by the employer affect fewer than ten employees or
- The temporary lay-offs (max. 90 days) affect a minimum of ten employees.
- The dismissals, transfers to part-time work and temporary lay-offs that are over 90 days and affect at least ten employees.
What should you do?
- Support your representative and give them information on, for instance, how things are in the work place.
- If needed, arrange meetings with the personnel and the employee representative so that everyone is informed on the negotiation progress.
- If you think it is likely you will be dismissed, find out about any opportunities to transfer to other jobs inside the company.
- Prepare to start the process of looking for a new job. Update your CV and familiarise yourself with the employment situation in your field and potential employers.
- The employer may, even during the negotiations, offer a so-called voluntary redundancy package. Think if this is a realistic and worthwhile option for you instead of a possible dismissal. Always have TEK's lawyers check the individual package offer before signing the package. It is important to remember that the package will affect your unemployment benefits and the employer’s duty to re-employ, among other things. Signing the package in most cases means that you give up all rights to contest a decision on the termination of your employment.