Jouni Kautto May 10 2023 Implementation of four-day working week Waselius & Wist | Employment & Immigration - Finland Jouni Kautto Employment & Immigration Arrangement between employer and employeeShortened work weekRight to full-time work Short work week and full vacationsNo effect on other employee benefits There have been a few experiments with implementing a shorter work week in Sweden and in the United Kingdom, and the same is expected in Finland once the new government is formed. A four-day work week can be implemented even without special regulation but there are a few challenges that need to be tackled.Arrangement between employer and employeeEmployment legislation regulates the working hours of employees in many ways, but the primary aim of the regulation is to ensure that the employee does not work too much. The working hours legislation does not set a minimum length for the working week and the employer and employee are entitled to agree on a shorter working week. If the employee wishes to work part-time, the employer should attempt to organise the work so that it is possible. However, the employee does not have the subjective right to switch to a shorter work week as it might not be possible for the work to be organised so that part-time work would be feasible.A four-day work week does not even need to mean a shorter work week. Under the Working Hours Act, the employer and the employee can agree to increase the employee's daily working hours to a maximum of ten hours per day. The applicable collective agreements may limit the employee's right to increase their daily working hours, but a full-time employment while working on four days per week should be possible in most sectors.In public discourse, the four-day working week is synonymous with decreased working time, so that the daily working time would remain unchanged. In such an arrangement, the agreed working hours would determine the employee's regular working hours. If the daily working hours exceeded eight hours, the additional hours would be considered overtime in the same way as for full-time employees. However, if an employee occasionally needed to work on the fifth weekday, this work would not be overtime, it would count as additional work. The employee would be entitled to their normal hourly wage but not any additional overtime compensation.Shortened work weekEmployees do not have the subjective right to demand shorter working hours, but the employer can, in its sole discretion, decide to move to four-day work week. Using part-time employment does not in itself require any special justification. It is sufficient that the employer decides that work will be available only on four days per week.Even an existing full-time employment relationship can be changed to part-time by the employer's unilateral decision. The change, however, requires production and financial grounds for dismissal and, if the company employs 20 or more employees, formal consultations with the employees. But if the employer decides that the activity will only be carried out four days a week in the future, the only options for the employees would be to accept reduced working hours or to choose to have their employments terminated by the employer.Right to full-time work The employment legislation still assumes that full-time employment is the default, and part-time work (ie, a shortened work week) is seen as an exception to the norm. The legislation aims to ensure that everyone can work full-time jobs and imposes an obligation on the employer to offer full-time work to part-time employees whenever possible. The obligation is only waived if the employee has expressly informed the employer that they are not interested in additional hours. However, as the employee's right to full-time work is based on the mandatory legislation, the employee is always entitled to change their mind and request the employer to offer future full-time positions to the employee, even if the employee had originally chosen to work only part time.In practice, the obligation to offer full-time work means that when the employer needs more manpower, the employer should first offer the existing part-time employees the possibility to take on more hours. The employer can only refuse to offer additional work to the part-time employee if the work would need to be done at times when the part-time employees are already working. If the number of employees on a shift increases from three to four, there would be more work available but no more work opportunities to the employees who are already assigned to those shifts. In those cases, the employer would not be able to or be obliged to offer those part-time employees more work. But if a factory or business switches from a four-day operation to a five-day operation, creating more work opportunities for the employees, the employer would have to offer the current part-time employees the opportunity to switch to full-time. If the work is not tied to a certain time and place, it is almost impossible for the employer to argue that additional work could not be assigned to an employee who is already doing the same tasks part-time.Short work week and full vacationsIn Finland, part-time employees accumulate and use annual leave in the same way as full-time employees do. According to the normal rule, the employee accrues annual holiday provided that the employee has had at least 14 working days per month. As there are normally 20-22 working days in a month, a person working a four-day work week would normally have 16-17 working days in a month, meaning that such an employee would accrue vacation each month just like a full-time employee.Even if the employee's working week only includes four working days, taking a week off would consume the same six vacation days as it would for the employee's full-time colleagues. The Annual Leave Act is based on the premise that each weekday consumes one vacation day, whether the day in question is a working day for the employee or not. For full-time employees, this occurs on Saturdays, as each Saturday also consumes a vacation day. If the employee worked for four days per week, the same logic would apply to the employee's additional day off, so that both Saturdays and the employee's additional day off would still consume one vacation day, even though those would not normally be employee's workdays.No effect on other employee benefits The employer has a duty to treat employees equally. The legislation also explicitly emphasises that the part-time employees must not be offered less favourable benefits or work conditions just because they are working part-time. Benefits that are calculated based on work output (eg, production bonuses or other incentives) can be proportioned based on employees working hours on a proportionate basis. If the benefits are not directly based on working hours, employees working a shorter work week must be entitled to the same benefits as full-time employees. The only acceptable limitation would be that employees are eligible for benefits only once their employment relationship has continued for a certain time, which may disqualify employees who only work occasionally from receiving some benefits.For further information on this topic please contact Jouni Kautto at Waselius & Wist by telephone (+358 9 668 9520) or email ([email protected]). The Waselius & Wist website can be accessed at www.ww.fi.