Helsinki (22.05.2018 - Heikki Jokinen) The plans of the Federation of Finnish Enterprises to get their employees to leave the union unemployment funds has been widely criticised. The trade unions are flabbergasted, too.

Mikael Pentikäinen, the CEO of the Federation of Finnish Enterprises announced in May that the federation is encouraging their member companies to pay unemployment fund fees for those employees who belong to the private YTK fund instead of the union funds.

Pentikäinen wrote with surprising honesty that the very aim of the action is to "create more pressure to reform the labour markets". According to him the entrepreneurs are running out of patience with how "the trade union movement puts a brake on necessary labour market reform and prevents enterprises and their employees from making local agreements concerning terms of employment".

Unemployment funds are traditionally set up and administered by the trade unions and work in co-operation with the unions. YTK fund is an exception to this rule, a private fund without connection to the trade unions.

An employee can choose to which fund he or she wants to join and there is no need to be a union member to join the fund.

The Federation of Finnish Enterprises represent mostly small and medium-size companies. It is not a party to the collective agreements negotiations and is known for its very hard line against collective agreements in general and trade unions in particular.

Against the law

The trade unions were not amused by this latest hostile move. Jorma Malinen, President of the Trade Union Pro put it very clearly in his comment.

This is not a new idea at all, he said. "It has already been dreamed up in certain dictatorship countries. The model mirrors that from the likes of China or Mexico, where companies decide on how their employees can organise."

"In many dictatorships companies prevent their employees from organising by setting up their own unions." Does Pentikäinen want to import other working life structures to Finland from dictatorships, Malinen asks.

All unions and trade union federations roundly condemned this provocative action. Vesa Vuorenkoski, Chief legal Adviser of Akava, the Confederation of Unions for Professional and Managerial Staff in Finland says that the goal of the Enterprises Federation is to erode the organising capacity of employees.

He also adds a practical point: if an employer for some reason fails to pay the unemployment fund dues, the employee is left without unemployment security. The final responsibility is always with the employee, Vuorenkoski stresses.

Antti Palola, President of the Finnish Confederation of Professionals STTK said to the newspaper Demokraatti that the action "tells on almost hostile attitude towards organised trade union movement and its goal to take care of the interests of its members on labour market".

The Central Organisation of Finnish Trade Unions SAK also strongly criticised the Enterprises Federation action. Saana Siekkinen, SAK Head of Development Project of Unemployment Security says that Enterprises Federation is now entering deep waters: according to the Finnish legislation employers shall treat their employees on an equal basis.

"The employer will be breaking the law if it only pays the dues to the YTK fund on behalf of their employees. They must also pay the dues of the organised employees."

And why only the YTK fund, Siekkinen wonders. "All unemployment funds have the same legally defined obligations to take care of unemployment security, so the security is the same."

Not well received in media either

The Finnish media is not known for its positive attitude towards the trade union movement.

Now several newspapers wrote in their editorials that the Federation of Finnish Enterprises has gone too far in its actions, looking for enemies instead of friends and burning its bridges.

Even Maaseudun Tulevaisuus, a newspaper where Mikael Pentikäinen was earlier editor-in-chief, said that with such actions as this the Enterprises Federation is left without any friends. Maaseudun Tulevaisuus is owned by Central Union of Agricultural Producers and Forest Owners of Finland.

"The trade union movement got furious and there was no support for this action from anywhere else either. The employers' umbrella organisation the Confederation of Finnish Industries EK has greeted the idea with stony silence. The message is that Pentikäinen must get himself out of the hole in the ice he made for himself", the newspaper wrote.

Read more:

Unions react to campaign by private unemployment fund to attract members (15.05.2015)