The Finnish Parliament recently approved amendments to the Working Hours Act (the “Act”). The amendments will enter into force on 1 January 2020, and aim to improve employees’ work-life balance by facilitating flexible working arrangements for all employees.
Flexible working arrangements have been embedded in Finnish culture for more than two decades, since the passage of the original Act in 1996. While other countries have only recently intensified discussions on flexible working arrangements, the government of Finland remains ahead of the curve with the passage of these new amendments.
The amendments apply to all employees except those who have full independence over their working hours, such as top management. They provide a framework for regulating working hours in all sectors. In practice, employers and employees are free to negotiate better terms.
Flexible working arrangements
Flexible working arrangements will expand with a new concept introduced by the amended Act. Starting in 2020, employees will have the right to decide independently when and where to perform their work for at least half of their working hours, as long as the nature of their work allows it. The remaining half of the employees’ working hours may be determined by the employer.
Statutory working hours bank
A working hours bank has been in place to allow some employees to convert their overtime compensation, holiday bonuses or any other monetary benefits into leave for later use. The new amendments extend the existing statutory working hours bank concept to all employees. Currently, this right applies only when authorized by the collective agreement applicable to the employer. Starting 1 January 2020, a statutory working hours bank will be available in all workplaces upon agreement of the employer and their employees or employees’ representatives.
On 1 January 2020, the maximum yearly overtime limit of 250 hours (with a possible extension of 80 hours upon agreement of the employee and the employer) will be removed. The new amendments state that maximum overtime work over a four-month period may not exceed 48 hours per week. In addition, it will no longer be possible to agree on additional weekly overtime beyond the 48 hours.
Flexitime refers to a limited working time arrangement agreed on in advance by both the employer and the employee. The amended Act allows employees to extend or shorten their workday by four hours instead of the current three hours.
Employers should monitor the implementation timeline of the amendments and make changes to their employees’ overtime and working hours arrangements when applicable.