Sometimes in Finland, you may encounter offers or opportunities in which it is unclear whether the job in question will make you an employee or not. That, in turn, can determine whether the protections offered by laws governing employment relationships apply or not.
In this blog post, we talk about what makes an employment relationship. We also talk about the different cases when you might be working but are not actually an employee.
Hopefully, this blog post will help you make sense of the different types of opportunities and assess whether it makes sense for you to pursue them.
Laws and regulations governing Finnish employment relationships
Several different laws and regulations govern Finnish employment relationships. The Employment Contracts Act is central to the regulation of employment relationships in Finland.
Other laws are, for example,
- the Working Hours Act;
- the Annual Holidays Act;
- Occupational Safety and Health Act;
- Act on Job Alternation Leave;
- Non-discrimination Act;
- Act on Equality between Women and Men;
- Act on Personnel Funds;
- Young Workers’ Act;
- GDPR; and
- Act on the Protection of Privacy in Working Life.
In our Working in Finland self-guided online course we go over what these different laws mean for your employment relationship. We tell you what the basic rules are concerning employment contract contents, salary payments, family leaves, sick leaves, annual holidays, and occupational health and safety, etc. We also have a similar course for academic employees in Finnish universities.
Our mini-course on Finnish employment contracts, in turn, goes over the required contents of Finnish employment contracts.
However, before we get to discuss what should be in the employment contract we need to know whether you are an employee or not.
Getting ready to sign your first Finnish employment contract? Be better prepared by taking our online course “Mini-course on Finnish Employment Contracts”. You can find it in our online store.
What makes an employment relationship?
People in the Finnish job market are employed as:
- employees in employment relationships
- state civil servants
- civil servants working for a municipality
- civil servants working for the church
- freelancers and entrepreneurs
- workers in non-employment relationships (e.g.unpaid student interns)
Different laws and regulations pertain to these different groups. Since most people in Finland work in the private sector under employment contracts, in our blogs we usually talk about employees and their issues rather than, for example, civil servants.
What then defines an employment relationship in Finland? A person is in an employment relationship with an employer when he/she:
- has agreed to
- do tasks/a job
- in person
- for an employer
- for compensation of some sort, and
- under the leadership and supervision of the employer.
Usually, it is very clear that you are an employee. You’ve signed a written contract that defines your salary, your job description, your working hours, and so forth. Sometimes, however, things are not as straightforward and it’s difficult to tell whether you are an employee or not.
It is very important that you do know the answer to this question. The answer determines your right to access such things as occupational health care. But it also determines who is responsible for such things as making the necessary social security payments or doing the necessary income tax withholdings.
Employee or not
There are other types of work that do not make you an employee of the entity for which you are working. In some cases, you do not even intend or want to be as is the case with volunteer work. In some cases, however, it’s not very clear why you wouldn’t be or wouldn’t want to be. Here are some examples of when things can get confusing and you don’t know whether you are an employee or not.
Volunteer work
Finnish legislation doesn’t provide a clear definition of volunteer work. Normally this doesn’t present a problem. It’s clear, for example, that you are baking those pastries for your kid’s class bake sale on a voluntary basis.
Sometimes, however, it may be useful to think about what are the characteristics of volunteer work.
It is work that is usually done to promote or further a certain cause like nature conservation or youth outreach.
It’s open to all and nobody gets paid for the work they do. Nor do they receive any other type of compensation either. Food, small thank you gifts, etc. are usually ok as long as they are minor gifts.
Volunteer work stems from the desires and needs of the volunteer. They decide how much and how often they want to work. The entity for which volunteers work cannot expect or demand volunteers to do a certain amount of work.
What is really noteworthy is that the entity cannot replace work that would typically be done by employees to be done by volunteers. So, if the task in question requires a high level of skill or a certain education, the entity shouldn’t get that task done by volunteers equipped with those skills. For example, a professional electrician should not be asked to volunteer to rewire the clubhouse of their child’s sports club.
If you are interested in volunteer work, here is a list of opportunities.
Freelance work
A freelancer in Finland usually means a person who does fixed-term work gigs for one or several entities at once. In terms of employment status, a freelancer can be an employee, an entrepreneur, or neither of those two.
The status affects who is responsible for doing the proper insurance and tax withholdings from your compensation. It determines who is responsible for covering your holiday, or sick leave pay, occupational health care services, etc. Therefore it also should affect the level of compensation the freelancer gets.
Thus it’s important to know what your status will be if you are offered this type an arrangement.
Freelance work normally doesn’t qualify as an employment relationship if, for example,
- the entity providing the work does not supervise the work in any way. They just either accept or decline the final product;
- if the freelancer is able to determine when and where they do the work;
- the freelancer is free to use help to do the work; and
- the freelancer is free to accept other assignments from other entities.
The employee union Akava Special Branches has a really good chart to help you determine your freelancer status. It shows also the effects of a particular status on social insurance liabilities and the like. The chart is only in Finnish, but with the help of Google translator perhaps you can make sense of it.
Internships
The general rule is that internships should be paid positions and as such, they are employment relationships. Therefore all the laws and regulations governing employment relationships also govern internships.
Collective agreements usually allow employers to pay a lower salary for interns. It might, for example, be 75 % of the lowest salary for a similar position. But this depends on the applicable collective agreement.
Internships provide the necessary learning for students studying for a particular profession. Or they enhance the employability of the intern. In both cases there should be someone at the workplace teaching, directing, and supervising the learning process. Obviously, the interns also work but employers should not use interns as a supplemental workforce to cover employee shortages.
In Finland, internships that are unpaid are normally allowed only in very limited circumstances. Basically, only those internships that are organized through educational institutions, the unemployment office, or KELA can be unpaid. In these cases, the internship is not an employment relationship.
The Finnish Employment Contract Act allows employers to hire employees with a trial period that allows the employer to make sure that the new hire can do the job. Unpaid internships are not a substitute for trial periods.
Grant recipients
In Finland, quite a number of researchers do their scientific research on personal grants from, for example, Finnish foundations. Receiving a grant does not establish an employment relationship between the grantee and the recipient. Therefore those doing their research solely on grant money are outside any employment protections or employment-based social security benefits. Current rules mandate that grant recipients make their own social security payments from the grant money they receive.
Many grant recipients are affiliated with universities or research institutions. These institutions have their own rules governing these relationships. Such rules include, for example, provisions relating to office space, library use, etc.
The Finnish Union for University Researchers and Teachers has more information about the status of grant recipients here.
Unsure if you are an employee or not?
If you are unsure if the position you are offered or you are interested in makes you an employee or not, the SAK employee rights advisory service for immigrants advises employees on these, and other matters. The advice is available in Finnish and English.
Make sure you know what you are signing. Enroll in this short and inexpensive online course “Mini-course on Finnish Employment Contracts”. You can find it in our online store.
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2 thoughts on “Employee or not: how to tell the difference”
Thanks for the information. It would also be useful to give tips on what informs salary negotiations.
We have several blogs about salaries in Finland. Have you checked out those yet? None of them are specifically about salary negotiations, though, so thanks for the topic tip! I’ll put that on my list.
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