What is the role of the collective agreements?
Collective agreements include sector-specific conditions of employment, agreed between the employer and employee organization. Collective agreements include, in particular, terms regarding pay, working hours, annual holiday as well as other benefits and terms applied in the relevant sector. During the term of the collective agreements, both parties have a duty to maintain industrial peace. This means that strikes, lock-outs etc. against the collective agreement are forbidden. However, the duty to maintain industrial peace does not apply, for example, to political strikes or subsidy strikes. This is beacause the said strikes do not target to the said collective agreement itself and its provisions.
By means of collective agreements, the negotiating parties may agree on certain provisions in a way that differs from the law. This would allow for better consideration of sector specificities. The legislator has expressly left the labour market organizations the opportunity to deviate, for example, from certain provisions based on the Working Hours Act and Annual Holidays Act. In addition, labour market organizations may, within certain limits, extend the possibility of concluding workplace-specific and local agreements to individual workplaces.
Based on a collective agreement, by workplace-specific or local agreements, an employer may agree with the individual employee or employee groups on certain exceptions to the terms set out in the collective agreement. This is intended to increase flexibility in employment relationships and to take into account job-specific differences better.
In certain situations, freedom of contract has also been particularly added to the workplace by the Collective Agreement for the Commercial Sector. Examples of workplace-specific agreement options include agreeing on the timing of holiday pay and holiday bonus, arranging 10-hour days as well as agreeing on the timing of announcing the schedule of work shifts to the employees. One of the aims of Finnish Commerce Federation for the upcoming negotiation round is to increase the possibility to conclude workplace-specific agreements. The aim is that the provisions of the collective agreement could be applied as flexibly as possible in the individual workplaces.
Collective agreements can be either normally binding or generally binding. The Collective Agreement for the Commerce Sector is generally binding. This means that also non-organized employers are bound by the provisions stated in the said collective agreement. A generally binding, nation-wide collective agreement sets out the terms and conditions of employment that apply to the work performed by, or is closely assimilated to, the employee.
