Basic information on employment relationships for new employers

Even if the company is not a member of an employer organisation, the terms and conditions of employment must be at least those set out in a collective agreement that is generally binding. A national collective agreement which is considered representative for the sector concerned is generally binding. The Committee for the Determination of General Applicability confirms by decision whether a collective agreement is generally applicable. A national collective agreement covering approximately half of the employees in the sector is considered representative.

For example, the Collective Agreement for Commerce Sector, which applies to many occupational groups in the sector, is generally binding. If the employer and the employee had agreed in the employment contract on an employment condition that was less favourable to the employee than the provision of the general collective agreement on the same subject, that employment condition would be null and void and the provision of the general collective agreement would have to be followed instead.

The terms and conditions of employment come from labour law, collective agreements, employment contracts, workplace practices and the employer’s right to supervise work. These so-called sources of rules governing the employment relationship are given precedence. A lower-ranking source of regulation cannot undermine a worker’s right to the benefits provided by a higher source of regulation. The order of precedence is broadly as follows:

1. absolute provisions of law
2. absolute provisions of collective agreements
3. the terms of the employment contract and established practice
4. provisions of law which may have been agreed upon otherwise, i.e. optional provisions of law
5. the employer’s regulations, the so-called right to supervise work

The rule of preference alters the order of precedence as follows: if there are different provisions on the same subject in different sources of legislation, the matter must be decided in accordance with the most favourable option for the employee.

Finally, dispositive legislation must be taken into account. This means that either the parties to a collective agreement or sometimes to an employment contract have the right to agree on a matter regulated by a legal provision to the disadvantage of the employee. This is expressed, for example, in the wording “unless otherwise agreed”. Most commonly, only national employers’ and employees’ unions in the sector have the right to agree otherwise in collective agreements.

Labour law defines the rights and obligations of both employees and employers. The main laws affecting the employment relationship are the Employment Contracts Act, the Working Hours Act and the Annual Holidays Act. The Employment Contracts Act defines the general rights and obligations of employees and employers. When entering into an employment contract with a new employee for the first time, the employer should already be familiar with the provisions of the Employment Contracts Act, such as on the form and duration of the employment contract and the trial period.

Examples of other key labour legislation include the Young Workers’ Act, the Act on Equality between Women and Men, the Act on the Protection of Privacy in Working Life, the Occupational Safety and Health Act and the Occupational Health Care Act.

A collective agreement is a collective agreement between employers’ organisations and employees’ unions. The Collective Agreement for Commerce Sector is the main agreement in the commerce sector and is negotiated by the Finnish Commerce Federation, representing employers, with Service Union United PAM, representing employees. Collective agreements are often referred to by the abbreviation CBA.

The Collective Agreement for Commerce Sector covers, among others, retail salespersons, wholesalers, clerical employees and logistics workers. Other collective agreements in the commerce sector are: the Collective Agreement for Retail Supervisors, the Collective Agreement for Automobile Workers in Commerce, the Collective Agreement for Opticians and the Collective Agreement for Retail Logistics Supervisors.

The majority of the provisions of the collective agreements are more favourable to the employee than the law and therefore take precedence over the law under the ‘more favourable’ rule. The only provisions that could be agreed upon to be less favourable than the law are those on which the legislator has given the unions the right to agree otherwise.

In day-to-day labour relations matters, a collective agreement is a very important tool, as it contains provisions on minimum wages, various bonuses, regular working hours, calculation of holiday pay, holiday bonuses and sick pay, among other things.

Employers can get the best help on the contents and interpretation of the Collective Agreements in the field of commerce from the experts at the Finnish Commerce Federation, who have negotiated the Collective Agreements in the sector with the Employees’ Union.

There are also groups of workers in the commerce sector who are not covered by any collective agreement, such as senior salaried employees and salesmen.

An employment contract is a contract between an employer and an employee whereby the employee personally undertakes to work for the employer under the employer’s direction and supervision in return for salary or other remuneration.

An orally agreed contract of employment is as valid as a written contract, but written form is strongly recommended. In an oral contract, there is always a risk that the parties may have understood a term of the contract different to what was intended.

The Employment Contracts Act obliges the employer to provide the employee with a written explanation of the main terms of employment listed in the act. The mentioned terms can be included in the written employment contract, in which case no separate explanation is required. This is another argument in favour of a written employment contract. If you are a member of the Commerce Federation, you are encouraged to use the employment contract forms available on our members’ website. In addition to the general employment contract form for the commerce sector, you can also use the employment contract form for salespersons under the Act on Commercial Representatives and Salesmen, retail supervisors, retail  supervisors, those not covered by a collective agreement (refers to senior salaried employees) and for school pupils under the “Get to Know Working Life and Earn Money” programme. In addition, a frame agreement with the on-demand workers is available on the Finnish Commerce Federation’s website, which sets out the terms of any employment contracts that may be undertaken. The framework agreement is not an employment contract and is not binding on either party, but it simplifies the process of agreeing on a fixed-term employment contract in the future.

The employer should carefully consider what is to be included in the employment contract and the level of detail with which it is to be recorded. Oral commitments are also relevant, as an oral agreement is as binding as a written one. A change to the terms agreed upon with the employee can be made by agreement. A unilateral substantial modification of the terms of the employment contract can only be made using the notice period and provided that the employer can show that there is a reason for the modification equivalent to a ground for termination of the employment relationship. As noted above, the Employment Contracts Act requires evidence of agreement on many essential terms. Nevertheless, it is advisable to define work tasks, for example, loosely, as it is difficult to anticipate all future needs. The employment contract should set out the employee’s regular weekly working hours, but it is not advisable to limit how these are to be scheduled in the contract.

If the employer begins to adopt a particular approach to a particular matter and even if this approach has never been specifically agreed upon with the employee, it is possible that, over time, this recurrent approach will become a contractual or established practice. This means that the employer would no longer be able to change that practice without the employee’s consent or grounds for termination. For a practice to become an established condition of the employment relationship, it must have lasted for a long period of time without significant exceptions. For example, a voluntary financial benefit paid over a long period of time may become a condition of the employment relationship. This can be avoided by changing the practice from time to time or by making a separate annual decision on the benefit in question. Shift placements do not become a fixed condition of employment without an explicit commitment by the employer.

Before hiring a new employee, it is important to determine whether the employer has the obligation to offer extra work to its part-time employees and whether the employer had the obligation to offer an employment relationship to former employees who may be subject to the re-employment obligation.

Under certain conditions, the Employment Contracts Act gives priority to the above-mentioned persons in relation to the work offered. As a general rule, it is also not possible for a company to have workers who have been laid off or whose employment is threatened with termination at the same time as new workers are being recruited. This text does not deal further with these very important recruitment constraints.

When a business is transferred, the employees are transferred to the new employer as so-called ‘old employees’. This means that the new employer is bound by the rights and obligations associated with the transferred employment relationships and cannot make changes to the employment contracts except by agreement. The conditions for the transfer of a business are:

• there is a change of employer, a mere share deal is not a transfer of business
• there is a juridical link between the parties, such as a contract
• the object of the transfer is a functional entity.

Requirement of a justifiable reason

An employment contract is valid until further notice, i.e. a permanent contract, unless it is concluded for a fixed term for a justified reason.

The law does not list the conditions under which an employment contract may be concluded for a fixed term. In assessing whether there is a justifiable reason, the practical needs of the workplace must be taken into account on a case-by-case basis. In practice, an employment contract may be concluded for a fixed term if the nature of the work, substitution, traineeship or other similar reason or other reason relating to the activity of the employer or the work to be carried out so requires.

If the employer has a permanent need for labour, a fixed-term contract is not permitted and must be concluded until further notice. The provisions on the conditions for concluding a fixed-term contract are established for the protection of the employee and therefore cannot be agreed upon to the detriment of the employee. If the fixed-term contract is concluded at the employee’s initiative, it must be based on a genuine request from the employee.

Nature of the work

The use of a fixed-term contract is justified when it concerns the performance of a specific job or set of jobs or short-term work that is not carried out on a continuous basis by the employer.

The use of a fixed-term contract is also possible for seasonal work. Work is seasonal if it is carried out only during a certain period of the year or if the volume of work increases substantially during periods that are known in advance. Work can be considered seasonal if temporary labour is needed only for a short period. If, on the other hand, the work is carried out repeatedly each year, for example for 9-10 months, it cannot be considered seasonal.

An employer may also hire a person as additional labour under a fixed-term contract for the duration of a specific order, if this is absolutely necessary for the delivery of the order. In such cases, however, the use of a fixed-term contract must be conditional on the employer having reasonable grounds to assume that, after the order in question has been delivered, the employer will not have a new job offer for the employee in question. The size of the employer and previous business relations are relevant in assessing the situation.

If a part-time employee is already employed by the business, the employer must assess, before hiring a new fixed-term employee, whether the work is of the nature that it should be offered to a part-time employee employed by the employer under the Employment Contracts Act.

Substitution

The use of a fixed-term employment contract may also be justified by the need for a substitute. The reason for the substitution is irrelevant. What is relevant is that the employment relationship of the absent employee continues for the duration of, for example, family leave, study leave, sick leave, annual leave or other similar absence. The need to take on a fixed-term worker may also be based on the employer’s need to temporarily reduce his/her own workload.

Non-stability of demand

Lack of stability of demand may be a valid reason for concluding a fixed-term contract. In the commercial sector, for example, the opening of a new branch or the expansion of activities to a new location may be such a reason. Once demand has stabilised, there must be another justifiable reason for a fixed-term contract.

Other justifiable reason

The use of a fixed-term contract is always possible if it is justified by the employer’s activities and the work to be carried out and is not intended to circumvent the provisions on protection against termination of employment.

Absence of justifiable cause

The very first fixed-term employment contract concluded without just cause has in practice become a contract valid until further notice. The use of recurrent fixed-term contracts requires that there be a justifiable reason for each fixed-term contract. The use of successive fixed-term contracts is not prohibited, for example, where the employer offers a substitute a new fixed-term position on a genuine basis.

Mixed employment contract

A fixed-term employment contract may also be concluded with the possibility to terminate the contract with notice. Such contracts are known as mixed contracts. The employer and the employee can terminate the employment relationship on the normal grounds for termination, subject to a period of notice.

Conversion into a contract valid until further notice

If there is no legitimate reason for concluding a fixed-term employment contract as required by law, or if that reason has ceased to exist, the fixed-term employment contract becomes an employment contract of indefinite duration. The contract as a whole is not considered null or void, but only the term of the contract is invalid.

Even if the employer allows the employee to continue working after the expiry of the contract period without a new contract, the employment contract is deemed to have become an employment contract of indefinite duration.

Under the Employment Contracts Act, the employer has the right to supervise work, i.e. the right to determine the content of the work, how it is to be done, where it is to be done and when it is to be done. The employer may exercise this right to supervise work within the limits laid down by unconditional legal provisions, Collective Agreements and the employment contract concluded. The more detailed the employment contract, the more restricted the employer’s right to supervise the work. Many matters should therefore be loosely defined in the employment contract or left entirely to the discretion of the employer. For example, it is advisable to define the tasks to be performed or the place where the work is to be carried out in a sufficiently loose manner. On the other hand, it is not advisable to include any reference to the scheduling of working hours in the employment contract.

The right of supervision is part of the right to supervise and manage work, which entitles the employer to ensure that the employee complies with the instructions given. If this is not the case, action must be taken on behalf of the employer. The level of intervention depends on the situation and the seriousness of the negligence.

When recruiting an employee through a job advertisement, it is important to remember that the advertisement must not be discriminatory. For example, gender can only be used as an application criterion if there is an acceptable reason related to the job. Only those characteristics of the applicant that are relevant to the job in question may be required. For example, fluent oral and written language skills cannot be required if the job does not require them.

In principle, information on the job applicant may only be collected from the applicant themselves or, with the applicant’s consent, from other sources.

Only information which is relevant to the nature of the work to be done or the employer’s activities may be asked during the interview. A job applicant may refuse to answer unnecessary questions, such as those relating to relationships, and there must be no adverse consequences for the applicant. Even the consent of the job applicant does not justify the collection of information about the applicant that is not necessary for the selection of the employee.

When processing and storing a job applicants’ personal data, the company must comply with the General Data Protection Regulation. The company must therefore ensure that applicants’ personal data are stored and processed in accordance with the law. When requesting for applicants’ personal data, the company becomes the data controller of the personal data.

The company must ensure that

• the applicant is informed of what data will be collected, stored and used about the applicant and for what purpose, and the applicant’s consent to this is obtained by means of an appropriate consent form.
• the data will be used and processed only for the purpose for which it was collected. For any other purposes, the consent of the job applicant must be obtained.
• only the information necessary for the performance of the job is collected from the applicant.
• the data collected will only be used for as long as the applicant is involved in the application process.
• data which is no longer used will be deleted.
• the applicant will be informed of how long their personal data will be kept.

The applicant may be required to undergo a personal or aptitude assessment. The assessment is carried out with the consent of the job applicant. The methods used for the assessment must be reliable and the assessors must be experts in the field. The person being assessed has the right to receive a written opinion on the result of the assessment free of charge.

Credit information may be requested from the person selected for a specific job.

For more information on requesting credit information >>

A drug test certificate may be required from a person selected for a particular position if the company has a written substance abuse program. If a drug test certificate is to be requested from the successful candidate, the applicant should be informed of this during the application process. The company will be responsible for the cost of obtaining the certificate.

For more information on drug testing >>

If the work is covered by a collective agreement, it usually determines the minimum wage. The Collective Agreement for Commerce contains a salary table for each occupation. The amount of the table salary is influenced by:

• the location of the workplace (the Helsinki metropolitan area or the rest of Finland)
• how demanding the work is
• total time worked in the occupation in question in an employment relationship
• degree or diploma obtained

For a full-time employee working 37.5 hours per week, the salary is determined as a monthly salary. For part-time workers, i.e. those working less than 37.5 hours per week, salary may be determined either as an hourly rate or as a proportional monthly salary.

If an employee covered by the Collective Agreement for Commerce Sector has not yet completed a year of work experience in the commerce sector, they may initially be paid a trainee salary. However, a graduate with a vocational qualification related to the job must be paid at least the salary of an employee in year 3 of the seniority level.

If the contract is concluded with a student at a primary, secondary or vocational school who has not yet completed two months of work experience in the commerce sector, he or she may be paid a school student’s salary which is lower than the trainee salary.

When the employee has accumulated a total of one year’s experience in the occupation in question, they will be paid the salary of a first-year employee according to the place of employment, either in the Helsinki metropolitan area or in the rest of Finland, in accordance to the salary table. In addition to the work performed, work experience is also acquired during periods equivalent to working time within the meaning of Section 7 of the Annual Holidays Act, such as sick leave for a limited period.

The seniority levels according to the Collective Agreement for Commerce are 1st, 3rd, 5th and 8th year.

Time worked in other occupations is taken into account to a reasonable extent if it partly corresponds to the professional experience required for the job.

Various allowances may be payable in addition to the table salary. The most common of these are various working time bonuses based on the distribution of working time.

Of the Collective Agreements in the Commerce Sector the Collective Agreement for Retail Supervisors does not contain any salary provisions, but rather the salary is agreed upon between the parties. There is no collective agreement for senior sales staff or salesmen in the commerce sector, so salaries are negotiated between the parties.

The employer must arrange social security related insurances for the employee, which the employer can get from a pension insurance company of the employer’s choice. The statutory social insurance contributions are:

• statuatory pension insurance contribution (TyEL)
• Workers compensation insurance contribution
• social security and health insurance contribution
• unemployment insurance contribution, and
• group life assurance contribution for employees.

A full-time employee covered by the Collective Agreement for Commerce has a working week of 37.5 hours. If the weekly working time is less than 37.5 hours, the employment relationship is a part-time relationship.

The possible, but in practice exceptional, working time for employees covered by the Collective Agreement for Commerce is 40 hours per week. This system includes the so-called “pekkas” holidays, whereby the annual working time is very close to that of those working 37.5 hours per week.

For those groups of workers who are not covered by the Collective Agreement, a 40-hour working week may be agreed in accordance with the Working Time Act. Senior Salaried employees are included in this category.

If the employee works in a position that is not covered by the Working Time Act, the working time is usually not defined at all. This is generally the case for salesmen.

The weekly working hours of part-time workers must be specified in the employment contract. It should be a specific number of hours, not, for example, 20 to 30 hours per week.

So-called zero hours contracts are not possible in the commerce sector. Instead, it is possible to conclude an on-demand contract if necessary (see the section on “Fluctuating labour needs – what methods are available”).

It is advisable not to make any stipulations in the employment contract about the allocation of working time, but to leave it to the discretion of the employer. It is advisable to ask the employee to consent to working extra hours and Sundays if necessary in the employment contract.

If the employer needs to use a system for averaging working time(see the section on “Fluctuating labour needs – what methods are available”), it is advisable to define the weekly working time as an average, e.g. an average of 20 hours per week. This allows for weekly variation in working time according to need, as long as it is balanced out over a predetermined period of time, i.e. the averaging period, to at least the number of hours specified in the employment contract. The length of the averaging period should not be specified in the employment contract.

When the first employee covered by the Collective Agreement for Commerce Sector is hired, the decision as to whether the company will apply the annual leave system or the weekday public holiday system must be made.

Under the annual leave system, an employee always earns one day of paid leave after working a certain number of hours, as defined in the Collective Agreement. A maximum of nine paid annual leave days can be accrued in a calendar year. Hours may be scheduled on public holidays, irrespective of the number of public holidays, in accordance with the employment contract or, in the case of a system for averaging working time, any other working time required, taking account of the relevant provisions. The annual leave system is well suited to work which also needs to be carried out at weekends and on public holidays, such as retail sales work.

Under the weekday public holiday system, public holidays and eve days as defined in the Collective Agreement reduce the working time of the employee without any reduction in pay. This system, on the other hand, is well suited for work with so-called office hours, i.e. working days from Monday to Friday.

Different working time systems may apply to different occupational groups. For example, a retail salesperson may be covered by the annual leave system and a logistics worker in the same company may be covered by the weekday public holiday system.

The system chosen can be changed, but not in the middle of the calendar year. The choice of the working time system is a matter for the employer to decide unilaterally and should not be recorded in the employment contract.

It is typical in the commercial sector that labour needs can vary from month to month. There are many possible solutions to this situation.

Fixed-term contracts

If the company does not need a permanent worker but only for a seasonal period, a fixed-term contract can be concluded for this period. The employment contract may specify that the employment relationship will end on a certain date, or it may specify an estimated duration, which will be specified later. A fixed-term employment relationship must always be justified in accordance with the Employment Contracts Act and this must be recorded in the employment contract.

On-demand contract

If necessary, a so-called framework contract can be concluded with the on-demand worker. This is not an employment contract, but an agreement on the terms and conditions that will apply to any future employment contracts. The on-demand worker does not have a permanent, foreseeable need for their labour, but is offered work at short notice in response to emerging needs. Typically, the on-demand worker will cover unexpected absences. The framework contract does not in itself oblige the company to offer work, nor does the framework contract oblige the worker to accept the work offered, but rather each period of work is agreed upon separately and each period is a separate fixed-term employment relationship.

System for averaging working time

If a company needs to hire an employee either for an indefinite or permanent contract or for a longer-term fixed-term contract, and the number of working hours required varies from week to week during the contract, it is advisable to use a system for averaging working time. In this system, the employer defines a period of time during which the number of hours worked will be levelled out to the average number of hours in the contract. The maximum length of the adjustment period is 26 weeks and the number of pre-planned weekly hours can vary between 0 and 48 hours. If certain conditions are met, the length of the adjustment period may be between 27 and 52 weeks.

The number of weeks in the period, the start and end dates and the total number of hours to be worked by the worker during the period must be specified in advance. Depending on the length of the period, the above information must be provided at least two or three weeks before the start of the period. The adjustment period starts on Monday and ends on Sunday, even if the worker does not work on those days of the week.

Subcontracting and temporary agency work

Subcontracting or temporary agency work can also be a solution to fluctuating labour needs, but these are not covered in this text.

The Employment Contracts Act stipulates that salaries are payable on the last day of the pay period, unless otherwise agreed in the employment contract. Monthly salaries must therefore be paid on the last day of the month, unless otherwise agreed.

The employer must ensure that the salary is in the employee’s bank account on the due date. If the due date is a Sunday, a Church holiday, Independence Day, Christmas Eve, Midsummer’s Eve or a public holiday, the salary is due on the working day preceding the due date.

Monthly salaries are usually paid once a month. For hourly paid employees, the salary is paid every two weeks in accordance with the Employment Contracts Act. However, the Collective Agreement for Commerce also allows for hourly salaries to be paid once a month, if this is also the case for monthly paid employees.

If, in addition to the basic salary, the employee receives a commission or other performance-related component of the salary, the payment period for this component may not exceed 12 months. If, on the other hand, the salary is wholly or mainly performance-related, it must be paid at least once a month.

At the end of the employment relationship, all claims arising from the employment relationship, i.e. the final salary, must be available to the employee on the last day of the employment relationship. However, a separate agreement may be made, i.e. the employment contract may provide for a period of time for the final payroll to be calculated. It is therefore advisable to agree on this, as the employer may have to pay the so-called ‘waiting period’ salary if the final account is delayed.

The employer has a duty to provide the employee with a thorough training. A good orientation will result in a more competent and committed employee. Especially for young people or others with little work experience, oreintation should be more thorough than usual.

It is important that the employer is able to verify adequate training afterwards, if necessary. A good training plan, on which both the trainer and the employee sign off when they have received sufficient training, will help to verify this. This is important in case there is a need later to claim that the employee has underperformed, is unskilled or does not follow the instructions given.

It is good to have written instructions on a number of key policies, such as sickness and other absence procedures and, in a retail business, personal shopping policies. The aim of such guidance is not only to provide clear information about the policy, but also to prevent disputes in the workplace.

Occupational health care should be provided starting from the very first employee

The Occupational Health Care Act obliges employers to provide preventive occupational health care, even if there is only one employee in the company. This obligation is independent of the number of hours worked by the employee or the duration of the employment relationship. When occupational health care services are procured and planned, the issue should be discussed with the employees.

The primary objective of occupational health care is to promote the health and fitness of employees for work, safe working conditions, the functioning of the work community and the prevention of work-related illnesses and accidents. Only preventive occupational health care of this kind is required by law. On a voluntary basis, the employer may extend occupational health care to include medical care to the extent agreed with the provider. The provider may be a municipal service provider or a private medical centre.

Occupational health care services shall be covered by a written contract between the employer and the occupational health care provider. When concluding the contract, it is important to consider the type of services that meets the needs of the company.

Once an occupational health care contract has been signed, an occupational health specialist will visit the workplace to assess the potential health risks in the workplace. On the basis of this assessment, the employer and the occupational health care provider draw up an occupational health care action plan. The action plan includes the objectives of occupational health care, the needs of the workplace and measures to support working capacity.

Occupational health care is free of charge for the worker. Employers can also arrange occupational health care for themselves at their own discretion.

Kela reimburses part of the costs of occupational health care to the employer.

For more information on compensation, see the Kela website >>

The Occupational Safety and Health Act obliges every employer to draw up an occupational safety and health policy. It sets out the objectives for occupational health and safety activities at the workplace and activities to maintain the working capacity of employees. The action plan also sets out the responsibilities for occupational safety and health and the way in which occupational safety and health cooperation is organised.

For more information on occupational safety and health and a model form for an occupational safety and health action plan, see the following website >>

The obligation of equal treatment in working life means that workers must be treated equally, unless there is justification to the contrary, taking into account their position and duties.

Prohibited grounds for discrimination include:

• age
• sex
• health status
• disability
• nationality or national or ethnic origin
• religion or beliefs
• opinions
• sexual or gender orientation
• trade union activities
• other personal reasons

Discrimination is prohibited at all stages of the employment relationship, starting from the publication of the job advertisement. Employees must be treated equally in terms of recruitment criteria, working conditions, terms and conditions of employment, career progression and access to training.

Employees on fixed-term or part-time contracts must not be treated differently from other employees unless there are objective reasons for applying less favourable conditions.

Discrimination in working life is prohibited by the Employment Contracts Act and the Equality Act. Discrimination on the grounds of sex is prohibited by the Equality Act. An employer who discriminates can be ordered to pay compensation to the discriminated person.

A TET period, or work experience period, provides young people with information on different professions and working life. The student chooses a workplace where they will work under the supervision of an adult and in a job that is suitable for young people. The TET period lasts a week for 8th graders in primary school, 1-2 weeks for 9th graders and a week for upper secondary school students. Practices may vary from school to school. During the TET period, the young person is not in an employment relationship, i.e. the period is unpaid.

The “Get to Know Working Life and Earn Money” traineeship programme for school student’s is negotiated separately between the Commerce Federation and the Service Union United PAM. It is a two-week period in June, July or August. It is an employment relationship, but the unions have agreed on conditions that differ from a normal employment relationship, such as a lower salary than that of a school student. The duration and conditions of the contract must be reviewed annually.

Vocational qualifications include on-the-job learning, which takes the form of either a training contract or an apprenticeship. The training contract is concluded with the educational institution and it sets out the work tasks that the student will carry out to acquire the skills required in the degree. The student is not employed, i.e. not paid.

An apprenticeship can also be used to complete a vocational degree or part of a vocational degree. This is a fixed-term employment relationship based on an apprenticeship. The apprentice is subject to the same conditions as any other employment relationship, including remuneration in accordance with the Collective Agreement, with minor exceptions. The employer may be paid a training allowance. The practices for its payment vary.

Both training and apprenticeship contracts are conditional on the workplace being deemed to meet the requirements of the Vocational Training Act. The workplace must appoint a qualified supervisor for the student.

Vocational degrees include a work placement, during which the student has the opportunity to apply what they have learned in practice. The work tasks must correspond to the studies. The work placement can be either in an employment relationship or not.

If a company intends to employ a person who is not a citizen, it is the company’s responsibility to first ensure that the person is authorised to work in Finland. The employer must keep records of the foreign worker and his/her eligibility to work. The employer has an obligation to provide information to the TE Office.

The basis of a foreign person’s right to work depends on his or her nationality, the work to be done and the length of the working period.

Citizens of a Nordic country, an EU Member State, Liechtenstein or Switzerland do not need to apply for a separate residence permit to work, i.e. they can work in Finland on the basis of their nationality.

Citizens of countries other than those mentioned above usually need either a residence permit for workers or another residence permit entitling them to work.

The Aliens Act also defines the situations in which working in Finland is allowed without a residence permit for a worker. For example, it is possible to work as an expert for up to three months.

Minimum conditions of employment, such as minimum wage provisions, also apply to foreign workers.