Article 15 January 2021

Employment Law Review: The year 2020 in the rear-view mirror and 2021 appearing on the horizon

The year 2020 was turbulent in many ways: the worldwide pandemic slowed down a number of reforms and caused challenges for various industries. Now it is time to look back and remind ourselves of the changes that took place in the field of employment law over the past year. It is also time to glance at the reforms awaiting us in 2021, a year hopefully brighter than its predecessor.


The most defining characteristics of 2020 in the field of employment law were the temporary legislative amendments adopted due to the COVID-19 pandemic. Amendments were made to the Employment Contracts Act and to the Act on Co-operation within Undertakings enabling a quicker and wider implementation of temporary layoffs. Both the minimum notification and the co-operation consultation periods were shortened to five days each. In addition, employers were entitled to impose temporary layoffs for employees with fixed-term employment contracts. Redundancy grounds were accepted as appropriate grounds for terminating an employment contract during the trial period and the employer's re-employment obligation was prolonged to nine months. These exceptions were in force until 31 December 2020. Similar temporary amendments are not planned at the moment.

The amendments to the EU Posting of Workers Directive were implemented by amending the Act on Posting Workers. These amendments aim at promoting equal treatment of posted workers in the terms of employment concerning e.g. salary, travel, lodging and meal expenses.

In the beginning of the year, the new Working Hours Act entered into force. More information of the new act can be found here.

In addition, the Supreme Court issued several employment-related precedents and some of the more interesting ones related to the employer's consultation obligations. In one precedent, the Supreme Court affirmed the employer's right to conduct separate consultations simultaneously provided that employee representatives were properly given the opportunity to receive information and to express their views on alternatives. In another precedent, the Supreme Court ruled on the employer's obligation to provide information in connection with the commencement of co-operation consultations. The ruling can be seen as a reminder that it is important for the employer to ensure that sufficient and accurate information is provided in connection with the invitation.


The EU Whistleblowing Directive is to be implemented in Finland and other Member States during 2021. Certain private and public sector employers will have an obligation to arrange an internal reporting channel where employees and other persons identified in the directive may report breaches against EU law. The scope and content of the obligations to be laid down by the act implementing the directive have not yet been published.

The government bill on non-competition agreements was issued to the Parliament at the end of 2020. According to the proposal, compensation is proposed to be mandatory for all non-competition agreements for all employees regardless of the duration of the non-competition obligation. The amendments are expected to take effect in the beginning of 2022 followed by a one-year transition period during which old non-competition agreements can be terminated by the employer if the employer wishes to avoid the obligation to pay compensation during the validity of the non-competition agreement.

Also, a governmental working group has issued a draft bill on a new Act on Co-operation. In the current draft, employers would have a wider obligation to consult and inform employee representatives. The draft is being circulated for comments until 15 January 2021.

Further, a government bill on amending the Act on the Protection of Privacy in Working Life regarding the collection of personal data of employees from other sources than the employee is expected to be issued during spring 2021. Clarification on the matter is needed as the previous Data Protection Ombudsman's interpretation of the act has been criticised.

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