The Finnish Parliament's Employment and Equality Committee has approved the government's plans to lower the threshold for employers to fire workers.
Under the government's proposal, a "proper reason" would suffice for terminating an employment contract, compared with the current law, which requires the reason to be both proper and weighty.
Committee chair Arto Satonen (NCP), a former employment minister, told a press conference on Thursday afternoon that the reform is especially aimed at improving the operating conditions of small and medium-sized companies — as they will be more willing to hire staff if the threshold for dismissal is lowered.
"Recruitment is a big decision for a small company," Satonen said, adding that the threshold in Finland is the fifth highest among OECD countries.
However, not every instance of poor behaviour or inadequate performance would constitute sufficient grounds for dismissal, the government has previously said in a statement.
"A substantial reason is still required, so it’s certainly not about dismissals based on personal preference," Satonen said at Thursday's press conference.
How the law will, in practice, affect the threshold for dismissing workers remains to be seen — as Satonen noted that only "several years of legal practice" will provide the answer.
Opposition: Government wants "firing law"
The government's proposal has been roundly criticised as a "firing law" by opposition parties.
The employment and equality committee's vice-chair, opposition MP Lauri Lyly of the SDP, argued that there is no evidence the legislative change will improve employment.
"This is purely about weakening employee protection without any assessment of the real impact. No one can now say how much the threshold for dismissal will decrease," Lyly said.
He added that some 12,400 people lose their jobs in Finland every year on so-called personal grounds, meaning not as part of redundancy or restructuring talks, while a further 14,600 are dismissed during their probationary periods.
"This is a weakening that affects the entire labour market, which hits the most vulnerable areas the hardest — young people, women, and those in low-paid jobs," Lyly said.
The committee also issued a unanimous statement that the law’s impact on people taking pregnancy and parental leave must be closely monitored until 2028.
The bill will now proceed to parliament's main chamber to be voted on by MPs, and could be passed into law as early as the beginning of next year.
