SAK and employment agency associations agree on common principles

Driving shady businesses out of the employment agency sector

The Central Organisation of Finnish Trade Unions - SAK, the Employers' Confederation of Service Industries - PT and the Private Employment Agencies Association have agreed on recommendations whereby the contract concluded between an employment agency and its client would specify the principle of compliance with Finnish legislation and standard conditions of employment. The organisations have agreed that the pay rates prescribed in Finnish collective agreements must always be paid for work done in Finland. The aim of the recommendation is to ensure the legality of labour moving between Finland and Estonia or the other Baltic States within the enlarged European Union.

Although Finland will introduce a two-year transition period for labour mobility following European Union enlargement on 1 May, the movement of services will be entirely deregulated in Finland at this time. Leasing of agency labour constitutes trade in services, and so the transition period for labour mobility will not apply to employment agency operations.

The organisations have agreed that "model clauses" will be drafted for employment agencies, so that these can be included in the agreements made by these agencies with the party leasing labour. Failure to comply with the proper terms of employment would then constitute breach of contract resulting in a freeze on payments.

Juhani Järvenpää, Chairman of the Private Employment Agencies Association, confirms that the Association's member enterprises will also comply with the jointly agreed recommendation when they send labour to Finland from Estonia, where wage rates are lower.

Parties stress importance of union membership

The three organisations also emphasise the significance of good industrial relations, a stable labour market and employee organisation in trade unions. The Private Employment Agencies Association promises to advise persons seeking agency work of the opportunity to join a union and of the importance of membership. SAK regards the joint recommendation as a matter of some consequence.

"Through its information centre in Estonia and other channels SAK will advise Estonian workers of the opportunity to come and work in Finland as employees of agencies belonging to the Private Employment Agencies Association," says SAK Director Matti Tukiainen.

According to its Chairman Juhani Järvenpää, the Private Employment Agencies Association would like to see the backs of the shady businesses that bring its industry into disrepute. One common aim of the parties is to put a stop to the grey economy and unhealthy competition between enterprises.

SAK and the Private Employment Agencies Association are arranging a joint seminar in the Estonian capital, Tallinn, on 15 June. This event will assess the free movement of services and the earliest experiences of introducing the joint recommendation, and will provide an opportunity to agree on further co-operation.

Some Finnish employment agency businesses have already begun operating in Estonia. Agency workers are procured from Estonia particularly in the construction, services and engineering sectors. The Private Employment Agencies Association has 125 member enterprises.