Negotiations for reducing the use of personnel and the proposal for negotiations

Before the negotiations, the employer shall issue a written proposal in order to commence the cooperation negotiations and employment measures. The proposal for negotiations shall be issued at the latest five calendar days prior to the beginning of the negotiations in order to give the negotiating parties sufficient time to prepare. The proposal for negotiations shall be given regardless whether the intended reduction of personnel affects one or more employees.

The purpose of the negotiations proposal is to guarantee good conditions for the negotiations. The personnel must have an opportunity to exercise their influence over certain matters as stipulated by law. For that purpose, the personnel must be given sufficient information and an opportunity to present their views.

Negotiations shall be conducted in such timetable that the employee representatives have an opportunity to genuinely influence the decision-making. The employee representatives shall also be able to present counter-proposals on matters to be negotiated, and they shall be discussed in the negotiations.

Contents of negotiations

The measures considered by the employer and their grounds and effects shall be discussed in the cooperation negotiations in a spirit of cooperation in order to obtain consensus. In addition, the operating principles or action plan to promote employment shall be discussed. Also alternative measures in order to limit the number of personnel to be affected by the employer’s plans and to mitigate their consequences to the personnel must be discussed.

Duration of negotiations

The main principle of the cooperation negotiations is that the same issue does not have to be negotiated twice. The employer cannot dismiss employees on financial or productive grounds if the reasons, effects and alternatives thereof have not been discussed in the cooperation negotiations.

The duration of the obligation to negotiate, as stipulated in the Act on Co-operation within Undertakings, depends on the measures under consideration and the number of employees in that company. If the employer considers terminating employment contracts, laying off  personnel or reducing contracts of employment to part-time contracts and these measures affect less than 10 employees, or the lay-offs are planned for a period of a maximum of 90 days, the employer has fulfilled its obligation to negotiate once 14 calendar days of negotiations have elapsed.

If the employer considers terminating employment contracts, laying off  personnel or reducing contracts of employment to part-time contracts and these measures affect at least 10 employees, or the lay-offs are planned for a period of more than 90 days, the obligation to negotiate continues for six weeks. However, if the company regularly employs at least 20 but less than 30 employees, the duration of negotiations shall be 14 days. The same 14-day obligation to negotiate applies to company restructuring situations as well.

Information

Communication and information play an important role throughout the cooperation negotiations process as uncertainty increases suspicion and rumours.

After the negotiations the employer shall, in reasonable time, submit a general report to the representatives of the personnel groups on the decisions under consideration as a result of the cooperation negotiations. The report should include at least the following information by personnel groups, depending on what has been negotiated: the number of personnel to be dismissed or laid-off or whose contracts will be reduced to part-time contracts, the duration of temporary lay-offs and the timeframe in which the employer intends to implement the measures to reduce the number of personnel. At this stage however, the employer is not obliged to name the individuals to be dismissed.

After this, the managers have to brief the employees to be dismissed or laid-off, of how the employment relationship’s benefits function during the period of notice or lay-off period.