The Finnish Government has, on 28 November 2024, submitted a legislative proposal to the Parliament on amendments to the Finnish Co-operation Act, which was approved by the Parliament on 23 April 2025. The alterations aim to limit the scope of application of the Act and to expedite the change negotiation process, which, in turn, would reduce the regulatory burden of, in particular, small and medium-sized enterprises and to reinforce their operational capabilities.

The amendments are intended to come into force on 1 July 2025.

Elevation of the Scope of Application of the Act

Currently, the Co-operation Act is applied to undertakings and corporations carrying out economic activity and regularly employing at least 20 employees. According to the government’s proposal, the threshold of the scope of application of the Act would be raised to employers regularly employing at least 50 employees, although certain responsibilities would still be directed at enterprises regularly employing between 20 and 49 employees. These would include, for example, an alleviated obligation to engage in dialogue, and provisions on business transfers, mergers and demergers. Going forward, enterprises who regularly employ 20–49 employees would have to initiate change negotiations only when contemplating dismissals, layoffs, reductions to part-time employment or unilateral modifications of an essential term in the employment contract for financial or production-related grounds involving at least 20 employees during a 90-day period. By contrast, change negotiations would not be required in enterprises regularly employing no more than 49 employees upon layoffs of a maximum of 90 days when such layoffs would be based on temporary reduction of work or the employer’s possibilities to provide work.

Cutting the Minimum Duration of Change Negotiations in Half

Another key amendment proposal to be made to the Co-operation Act concerns the minimum duration of change negotiations. Currently, the change negotiations must be ongoing, depending on the topic of negotiation and the employee count of the enterprise, for at least six weeks or 14 days. In the future, these minimum negotiation periods would be half of those currently: three weeks or seven days, depending on the matters under negotiation and the number of employees employed by the company.

Obligation to Report with the Employment Services

As a new topic the Co-operation Act would, due to obligations arising from EU-level regulation, introduce a time period reserved for reporting with the employment services. The obligation would become relevant when an employer would have given a negotiation proposal on the dismissal of at least ten employees on financial and production-related grounds. For an employee dismissed in this manner, it would not be permissible for their employment contract to expire prior to 30 days having lapsed after the negotiation proposal has been submitted with the competent employment authority.

Related Services

◆ Employment & Benefits