Waselius & Wist Navigation
  • Our team
  • In Focus
    • Recent Work
    • News
    • Legal Updates
    • Publications
    • Rankings
    • Blog
    • Pykälät töissä podcast
    • Newsletter
  • About Us
    • Corporate Social Responsibility
    • ESG Initiatives
  • Expertise
    • Banking and Finance
    • Capital Markets
    • Corporate and Commercial
    • Corporate governance and Investigations
    • Data Protection
    • Dispute Resolution
    • Employment and Incentives
    • Energy and Natural Resources
    • EU and Competition
    • Financial Regulatory and Compliance
    • Insurance
    • Intellectual Property and Technology
    • Marketing
    • Mergers and Acquisitions
    • Private Equity
    • Real Estate
    • Restructuring and Insolvency
    • Tax and Structuring
  • Careers
    • Lawyers
    • Law students
    • Support staff
    • Open Positions
    • Contact
  • Contact
  • Our team
  • In Focus
    • Recent Work
    • News
    • Legal Updates
    • Publications
    • Rankings
    • Blog
    • Pykälät töissä podcast
    • Newsletter
  • About Us
    • Corporate Social Responsibility
    • ESG Initiatives
  • Expertise
    • Banking and Finance
    • Capital Markets
    • Corporate and Commercial
    • Corporate governance and Investigations
    • Data Protection
    • Dispute Resolution
    • Employment and Incentives
    • Energy and Natural Resources
    • EU and Competition
    • Financial Regulatory and Compliance
    • Insurance
    • Intellectual Property and Technology
    • Marketing
    • Mergers and Acquisitions
    • Private Equity
    • Real Estate
    • Restructuring and Insolvency
    • Tax and Structuring
  • Careers
    • Lawyers
    • Law students
    • Support staff
    • Open Positions
    • Contact
  • Contact
In Focus
Home In Focus Temporary closedown amid Covid-19 crisis – what can employers do?

Legal Updates19.03.2020

Temporary closedown amid Covid-19 crisis – what can employers do?

Even at the time of a serious crisis, the Finnish legislation tries to find a balance between the interests of the employees and the interests of the employers. The Finnish mentality does not allow solutions that would suddenly and abruptly leave an employee with nothing, but at the same time, the legislation recognises that if the employer does not survive, the employee will have no work in the future.

 

Disruption of work due to the Corona outbreak

The Finnish Employment Contracts Act stipulates that if work is disrupted due to circumstances beyond the employer’s control and the employer cannot provide employees with work, the employer is nevertheless obliged to pay the employees their ordinary salary but only for the first 14 days after the work has ceased. Based on legal practice a disruption is caused by circumstances beyond an employer’s control if, for example, the authorities force the employer to close down operations or if the employer’s place of business or factory is destroyed in fire or by natural disaster. Accordingly, if the employer would be ordered to close down a shop or office in order to prevent the spread of the Corona virus and the employees could not be assigned any work outside the shop or office, the employer would be liable to pay its employees salary during a maximum period of 14 days.


Controlled shutdown

If the employer chooses, on its own initiative, to suspend its business, the employees concerned would, at the outset, be entitled to their ordinary salary during such suspension. The employees’ right to salary ceases only if their employment is terminated or if the employee is laid off temporarily.

During a temporary layoff the employee’s obligation to work and right to salary are both suspended, but once the business situation improves and the temporary layoff ends, the employee returns to work normally. A temporary layoff may be full time so that the employee is completely released from any working obligation, and receives no salary, or cover certain hours only, in which case the employee’s salary is decreased pro rata. In either case the employment relationship remains in force and the employee is still bound by confidentiality and non-competition obligations that apply during employment.

 

Process to be followed before temporary layoffs

If the employer has 20 or more employees in Finland, any contemplated temporary layoff would trigger an obligation to consult with the employees or their representatives before the decision on a temporary layoff can be taken. However, if the need for temporary layoffs is at hand due to unforeseen circumstances and a delay with the contemplated layoffs could cause material harm to the employer’s operations, the decision to temporarily lay off employees may be made without prior consultations. The employer federations and the trade unions have urged that the exemption would be applied only if the employer and the employees agree that such circumstances are at hand.

If a formal consultation obligation applies, the employer has to formally notify the employees about the consultation process at least five days before the first consultation meeting. The statutory minimum period for the consultations is 14 days from the first consultation meeting. If the employer employs at least 30 employees in Finland and the employer is contemplating to temporarily layoff at least 10 employees for a period exceeding 90 days, the minimum consultation period is longer, i.e. six weeks from the first consultation meeting. However, the government has announced that the minimum negotiation period would be decreased to 5 days. The temporary measure would be in force for three months.

Once the decision on temporary layoffs is made the employees have to be notified about the decision and the temporary layoffs may start at the earliest 14 after the employees have been notified about the layoffs. However, some collective agreements have now waived this notice period and the government has announced that the notice period will also be temporarily decreased to 5 days as part of the legislation aimed to support the employers amid the crisis.  The expectation is that the relevant legislation will be enacted and the temporary measures will enter into force over the next weeks.

UPDATE 1.4.2020:
As of 1 April, the minimum duration of consultations before temporary layoffs has decreased to five days and the notice period prior to temporary layoffs has also decreased to five days. The shorter deadlines apply until the end of June 2020 and the employers may apply the shorter notice period and consultation time already in processes that have started before the legislation entered into force. However, despite the temporary measures the employers have to observe the longer consultation periods and notice periods defined in the applicable collective agreements.

For more information, please contact:

Jouni Kautto

Specialist Partner

Share:
Image

Contact info

Eteläesplanadi 24 A
00130 Helsinki, Finland

+358 9 668 9520
+358 9 668 95 222
info@waselius.fi

Quick links

  • Our Team
  • In Focus
  • About Us
  • Expertise
  • Careers

E-invoicing

E-address: 003710525214
Operator: Apix Messaging Oy
Service ID: 003723327487


BUSINESS ID 1052521-4
VAT ID FI10525214

Legal notice
Privacy notice
General Terms and Conditions

© 2025 Waselius Attorneys Ltd

This website uses cookies to compile statistical data on the use of our website in order to enable us to evaluate and improve our site. OK Decline Cookie Policy
Manage Cookies

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are as essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may have an effect on your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Non-necessary
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.
Functional
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytics
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
CookieDurationDescription
_lfa2 yearsMarketing & analytics (website visitor tracking) using Leadfeeder
Advertisement
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Others
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
SAVE & ACCEPT