Changes to the Employment Contracts Act at the turn of the year

News article

The changes came into effect on 1 January 2017.

The maximum length of the trial period has increased from four to six months. Another change is that the trial period can be further extended if the employee has been absent from work during the trial period due to inability to work or family leave.

As for temporary employment contracts, there is no change to the overall length of the trial period; it still cannot exceed either half the length of the temporary employment period, or six months.

The new regulation on trial periods will be applied only to employment contracts made after 1 January 2017. The trial period must always be agreed upon separately before the employment relationship begins, usually as part of the contract. The employer does not have the right to unilaterally decide on the length of the trial period.


The justification requirement for temporary work contracts has changed

As of 1 January employers can make temporary work contracts, without having to provide additional grounds, with jobseekers who have been unemployed for over 12 months. In such cases the temporary employment contract can be made for one year at most.

The contract can also consist of a maximum of three shorter temporary contracts, of which the combined duration is at most one year.


A shorter period of obligation to re-employ

As part of the legal changes, the period of obligation to rehire has been decreased from nine months to four months. An exception to this is that the period of obligation to re-employ is six months if the employment relationship had continued uninterrupted for at least 12 months before coming to an end.

The obligation to rehire makes the employer liable for offering work to an employee who has been laid off, if the Employment and Economic Development Office confirms that the laid-off person has been seeking work, and if the employer requires an employee for the same or similar work from which the person was laid off.


These are changing too

Unemployment benefits
The maximum payment time has been shortened, and both the daily expense allowance and the various extras have been reduced as of 1 January 2017.

Family leave compensation for employers
As of 1 April 2017, in accordance with the Health Insurance Act (1224/2004) the expenses incurred by employers by family holiday leave will be shared more equally. The family leave compensation is a one-time compensation of EUR 2,500 that is paid to an employer when an employee is on maternity leave or on parental leave based on adoption. The compensation is paid in cases in which the employer is legally bound to pay salary for the duration of the period of leave. There are changes in other benefits also.

Restructuring protection
Improvements have been made to the legal protections for people who are laid off for production and economic reasons. The employer is legally obligated to offer such employees the opportunity for training or education that improves their prospects of finding new work. Also, access to occupational health care must be granted to these employees for half a year after their being laid off. These changes came into effect on 1 January 2017. They apply to those employers who have at least 30 employees, and to those employees whose employment relationship has lasted at least 5 years.