Main provisions
Transition period

The new Maritime Employment Contracts Act (17.6.2011/756) entered into force on August 1 2011. It replaces the 1978 Seamen's Act and is the first step towards ratification of the International Labour Organisation's 2006 Maritime Labour Convention.

Main provisions

Although much of the content of the Seamen's Act is included unchanged in the Maritime Employment Contracts Act, some major improvements regarding employee rights have been introduced.

Fixed-term contracts
Since the new act has been formulated to correspond closely to the Employment Contracts Act (55/2001), it includes provisions regarding fixed-term employment contracts. The principal rule is that if there is no well-founded reason for offering a fixed-term contract, a permanent contract must be offered. In addition, if the number of fixed-term contracts is so high as to indicate that the employer needs a permanent labour force, then no fixed-term contracts are allowed. If an employee undertakes several fixed-term employment periods and there are only short interruptions between each one, he or she is entitled to full employment benefits.

Temporary leave
Another provision of the new act which mirrors the Employment Contracts Act regards an employee's right to obtain temporary leave from work in order to care for relatives or other close persons. The employer is obliged to rearrange the workload to enable the employee to take temporary leave in such a case. The employer, however, is not obliged to pay the employee during the period of temporary absence.

Travel expenses
Another important improvement which the new act introduces regards an employer's obligation to pay expenses incurred by an employee on his or her return journey home. The employer has this obligation, for example, when the employment contract comes to the end abroad, provided that the employment relationship has lasted at least six months. The right to reimbursed travel expenses is no longer dependent on the employee's nationality – all employees are treated equally. The government will subsidise half the cost of such travel expenses on application. This may be interesting for ship owners considering the option of mixed-crew agreements under the Finnish flag, which are increasing in number.

Medical expenses
The employer is also responsible for paying an employee's medical expenses for a period of 112 days, instead of 42 days as was provided by the Seamen's Act. However, the employer's liability to compensate is limited to any sums which are not covered by any government benefit.

Transition period

Although the Maritime Employment Contracts Act came into force on August 1 2011, it is subject to a transition period during which employers may continue to apply any collective bargaining agreements that were already in place on August 1 2011 until they expire. The terms of a collective bargaining agreement may be applied during its validity period even if it contradicts the provisions of the new act.

For further information on this topic please contact Tarja Bergwall or Herman Ljungberg at Hammarström Puhakka Partners, Attorneys Ltd by telephone (+358 9 474 2207), fax (+358 9 474 2247) or email ([email protected] or [email protected]).