Finland – Whistleblowing Protection

Overview1

Legislation particularly aimed at protecting whistleblowers is non-existent in Finland. Therefore, one must seek guidance in various statutory provisions.

Public confidence in impartiality, objectivity, and lawfulness of the government and its institutions has remained strong in Finland. For several years, the Transparency International has ranked Finland as among the least corrupt countries in the world.2

The comparatively low level of corruption in Finland is likely the outcome of the social equality and citizens’ trust in the political and administrative system. Finland’s administrative and legal culture emphasizes the values of common good, fairness and justice. There is the moral and legal condemnation of power centralization and socio-economic disparities in the society. The values of the Finnish public administration are built on the value base of a democratic constitutional state and a Nordic welfare society within a globalization. Furthermore, according to the Constitution3, Section 1:

“Finland operates in international co-operation for the protection of peace and human rights and for the development of society.”

This statement of basic values that consists of the internal and external considerations is one of Finland’s key strengths in combating corruption.

Despite the fact that Finland does not have any specific whistleblower provisions, there are many other ways of encouraging the reporting of official corruption and abuse of power. The general principles of openness, transparency and accountability of public administration are considered the main guarantees against corruption in Finland. Finland’s emphasis on the problem, rather than on the whistleblower, may explain why the country has no legislation particularly aimed at protecting whistleblowers.

There has been a gradual interest in ethics in the Finnish public administration – but not necessarily in whistleblowing. There are many cultural and historical limitations to introducing whistleblowing procedures as a special mechanism outside the chain of command in both the public and the private organizations. This is mostly due to the fact that political and administrative culture does not value whistleblowing and whistleblowers in Finland.

While the open society enables more space for whistleblowing, the organizational culture favors internal disciplinary procedures, especially with respect to avoiding conflicts of interest.

Labor Regulations In General4

Labor legislation in Finland consists, on one hand, of the norms that regulate the legal relationship, in other words the employment relationship, between the employer and the employee (individual labor legislation) and, on the other hand, the collective labor legislation.

The starting point for labor legislation is the principle of employee protection. Because of this, labor legislation includes mandatory provisions, which cannot be deviated from by agreement to the disadvantage of the employee. These include provisions to protect employees against unlawful dismissals, the preconditions of concluding a fixed-term contract, and the duty to apply the provisions of a generally applicable collective agreement.

Labor legislation also includes provisions that can be altered by collective agreement, such as the provision on sick leave compensation, and certain provisions concerning working hours. In addition, these laws contain provisions that become applicable only when no other arrangements have been agreed upon.

The main sources of Finnish labor law are legislation, collective agreements, and individual employment contracts. The terms of an employment relationship may, in practice, be determined by several different norms, such as the provisions of a law, the collective agreement, the employment contract, or some another agreement concluded at the workplace. The order of priority decreed by law determines the norm applied in each individual case. Since both the provisions of law and the regulations of collective agreements have minimum mandatory status, it is always possible to apply norms of a lower degree in order to agree on terms that are more favorable for the employee.

The Finnish labor market system covers the public as well as the private sector. Over time, the public sector has grown, gradually leading to a regulation of employment conditions similar to that known within the private sector.

Public Sector

The role of municipal values and codes is essential because two-third of public service (about four-fifths of municipal employees work in health care, education, and social services) is provided 422,000 employees in 416 municipalities.

Occasionally the Association of Finnish Local and Regional Authorities deliver circulars for the municipalities about good local governance. For example in 2005, the circular clarified principles about how municipal officials should deal with private sector actors and implement co-funded projects.

The basic regulation within the public sector is the 1994 State Civil Servants’ Act. In addition, the new Local Officials Act from 2003 regulates the working conditions of approximately 50% of all local officials.

Over 200,000 public employees working for the municipalities are contractually employed and their working conditions are governed by the Employment Contracts Act. As a result, the state and local government sector in Finland has two main groups of employees. There are a significant number of public sector workers with private law employment relationships. They are covered by the same labor law regulation that applies in the private sector.

Today, the prevailing view is that labor law also covers civil servants in the public sector, despite the fact that the Employment Contracts Act and several other labor laws do not apply to them. The specific rules that apply to these groups have increasingly become to resemble those that apply to private employees.

Finland does not have legislation as written codes of ethics concerning the public administration. Instead the provisions of the State Civil Servants’ Act (750/1994) serve as a code of conduct for state officials and the Local Officials Act (304/2003) for local officials. These provisions state traditional values such as equality, legality, responsibility and impartiality.

In addition, administrative matters are regulated by the Administrative Procedure Act (434/2003)5, which entered into force from the beginning of 2004. The basic legislative idea for the Act was to unite administrative principles, good administration, including public services in one law. The scope of application ranges from state and municipal authorities to public enterprises. More than fighting corruption directly, the main idea of the Act is to promote good behavior in public organizations, to improve the relations between citizens and administration and to prevent maladministration in administrative practices.

The Constitution of Finland6

Section 2 of The Finnish Constitution requires civil service and any exercise of public powers to be based on the law:

”The powers of the State in Finland are vested in the people, who are represented by the Parliament.

Democracy entails the right of the individual to participate in and influence the development of society and his or her living conditions.

The exercise of public powers shall be based on an Act. In all public activity, the law shall be strictly observed.”

Freedom of expression and right of access to information are contained within Section 12:

”Everyone has the freedom of expression. Freedom of expression entails the right to express, disseminate and receive information, opinions and other communications without prior prevention by anyone. More detailed provisions on the exercise of the freedom of expression are laid down by an Act. Provisions on restrictions relating to pictorial programmes that are necessary for the protection of children may be laid down by an Act.

Documents and recordings in the possession of the authorities are public, unless their publication has for compelling reasons been specifically restricted by an Act. Everyone has the right of access to public documents and recordings.”

The right to work and the freedom to engage in commercial activity is set out under Section 18 :

  1. ”Everyone has the right, as provided by an Act, to earn his or her livelihood by the employment, occupation or commercial activity of his or her choice. The public authorities shall take responsibility for the protection of the labour force.
  2. The public authorities shall promote employment and work towards guaranteeing for everyone the right to work. Provisions on the right to receive training that promotes employability are laid down by an Act.
  3. No one shall be dismissed from employment without a lawful reason.”

Subsection 3 is an explicit provision concerning legal protection against wrongful dismissal, stating that nobody may be dismissed without cause founded on statute law. Only reasons founded on statute law justify dismissal. Those reasons which justify the termination of employment contracts by the employer either with or without notice must therefore be stated by statute. As this provision stems from the constitution, it may be seen as a very strong protection for unlawful dismissals.

State Civil Servants’ Act7

Section 1 states:

”This Act governs the employment relationship to the state.

An employment relationship is a public-law employment relationship with the government as the employer and a salaried employee performing the work.

The meaning of ‘agencies’ in this Act, refers to state agencies or agencies established by law or by decree.”

Section 14 states:

”An official shall perform his duties properly and without delay. He must observe the rules of supervision and monitoring.

The official employee shall act as his position and duties require.”

Section 24 states:

”An official who violates or neglects his official duties may be given a written warning.”

Section 25, concerning dismissals, states that the employer can only give notice if it has a proper and weighty reason:

”An employment relationship may be terminated mutually so that it expires after a certain period of notice or, if agreed upon or specifically provided by law, without any notice thereof.

An agency may not terminate an employment relationship for any reason because of the officer, unless the reason is very weighty. Such reasons, may at least not consider

  1. the official’s illness, defect or injury, if not consequence of this has been a significant and lasting decline in official work and the staff for that reason are entitled to a disability pension,
  2. the official’s participation is by way of a civil service union decisions in one of the compound taken industrial action, or
  3. his political, religious or other opinions, or his participation in civic activities or associations.

Notice of termination on any ground referred to in this section shall be made within a reasonable time after the authority has been notified of termination basis.

An authority’s termination rights may be restricted by contract so that the authority may exercise it only on the grounds specified in the contract.

An agency may not terminate an official because of pregnancy. If an authority terminates a contract with an official who is pregnant, the dismissal is considered to be due to the pregnancy, unless the authority proves any other basis. An agency may not terminate an employee under special maternity leave, maternity leave, paternity leave, parental leave or care leave, nor, since learning of the official’s pregnancy, or if the officer exercises the aforementioned right to terminate the employment relationship so that it ceases when the above leave begins or while it lasts.

The service relationship of an official appointed for a fixed term expires without notice when this time expires, unless the employment relationship by reason of redundancy has been discontinued earlier.”

Furthermore the employer is, upon an extremely weighty cause, entitled to cancel an employment contract with an immediate effect regardless of the applicable period of notice or the duration of the employment contract. Such a cause may be deemed to exist in case the employee commits a breach against, or neglects duties based on, the employment contract or the law, and having an essential impact on the employment relationship in such a serious manner as to render it unreasonable to expect that the employer should continue the contractual relationship even for the period of notice.

Section 33 states:

”An official service employment can be immediately dissolved, if the officer grossly violates or neglects his official duties.”

If the public employee is given notice and contests the lawfulness of the dismissal the case must be taken up and handled in a fast procedure in order to let the employment relationship continue during the hearing of the case in order to guarantee that the employee might continue his or her employment if no lawful reason for the dismissal can be established.

Section 55 states:

”An official employment continues without interruption, if the dismissal or dissolution, according to a final decision, has been made without legal basis”.

Local Officials Act8

Section 2 states:

”In this Act, an office holder is a person who has a service relationship with a municipality. By service relationship means a public service employment in which the municipality is the employer and the office holder is carrying out work. A person is appointed to posts as is prescribed for in section 44 subsection 2 of the Local Government Act (365/1995).”

Section 35 states:

”An employer may not terminate an employment relationship for any reason due to the office holder, unless the reason is objective and valid. As such reasons can be considered a serious violation or breach of those obligations arising from the employment relationship, laws or regulations which are essential to the employment relationship and a significant change in the personal working conditions due to which its holder can no longer perform his duties. In determining whether there is an objective and valid reason, the employer and office holder’s circumstances shall be taken into account as a whole.

Such a reason referred to in subsection 1 is at least not

  1. office holder’s illness, disability or accident, unless his or her work as a result thereof has declined substantially and for so long that it is unreasonable to require the employer to continue the employment relationship,
  2. participation in industrial action that an office holder union has taken under the association’s decision,
  3. office holder’s political, religious or other opinions or the office holder’s participation in social or organizational activities, or
  4. use of legal remedies available to the office holder.

An officeholder who has breached or violated its obligations under the employment relationship may not be terminated until he or she had been warned and thus been given the opportunity to correct his or her procedure.

The employer shall before the dismissal assess whether it is possible to avoid dismissal by placing the office holder in another civil service employment.

If the ground for termination is such a serious violation in connection to the employment relationship that it cannot reasonably be assumed that the employer continues the employment relationship, subsection 3 and 4 need not be observed.”

Guidelines

There are also various guidelines and declarations on professional ethics. For instance, the Act on Health Care Professionals contains a prohibition of accepting bribes, connected with sanctions. The police, customs, taxation and many other administrations have stated guidelines of their own good governance.

The Ministry of Finance, that bears the main responsibility of the state personnel policy, published guidelines in 2005 called “Values in the daily job – Civil Servant’s Ethics”9. In the guidelines there is nothing specific relating to whistleblowing.

In sum, the ethical values of the Finnish public administration and officials can be interpreted as an interaction between value-based codes consisting of shared values and compliance-based codes as a set of agreed-upon standards.

Reporting of illegal activities

Finnish legislation does not contain any particular provision on the reporting of misconduct and corruption with regard to state civil servants.

However, there is a general rule that an officeholder normally is responsible for reporting illegal activities observed. In the Local Officials Act, there is an obligation to report offences “in well substantiated” cases to the police without delay:

Section 47 states:

”If an officeholder is suspected, on probable grounds, of being guilty of an offence in office or of otherwise acting contrary to his duties, he or she can be suspended from his or her duties for the period of an investigation or legal proceedings. Notification of violations in well-substantiated cases shall be made without delay.

If an officeholder is suspected, on probable grounds, of being guilty of an offence outside office, he or she can be suspended from his or her duties for the period of an investigation or legal proceedings, if the facts emerging from the case might affect the officeholder’s ability to manage his or her duties.

In cases other than those referred to in subsections 1 and 2, an officeholder may be suspended from his or her duties for the time that the officeholder, for reasons due to his or her person, is unable to perform the duties in an appropriate manner.”

Act on Occupational Safety and Health Enforcement and Cooperation on Occupational Safety and Health at Workplaces (44/2006)10

Section 50, Notification of a criminal case, and handling of the notification states:

  1. ”If there are probable grounds for suspecting that an act has been committed that is punishable under any act enforced by the occupational safety and health authority or under Chapter 47 of the Penal Code (39/1889), the occupational safety and health authority shall notify the police of the act for preliminary investigation. However, there is no need for a notification if the act is minor considering the circumstances, and the public interest does not require a notification.
  2. The occupational safety and health authority shall have an opportunity to be heard in the preliminary investigation of an act referred to in subsection 1 above. The public prosecutor shall provide the occupational safety and health authority with an opportunity to give a statement before the consideration of charges is completed. When the case is handled in court, the occupational safety and health authority has a right to be present and speak.
  3. The provisions in subsections 1 and 2 do not apply to illegal use of foreign labour referred to in Chapter 47, section 6a of the Penal Code. Separate provisions are issued on the notification duty and hearing of occupational safety and health authorities in connection with work carried out by foreign employees.”

According to the Police Act (493/1995)11, the police officer to whom the employee reports has a right to remain silent when receiving confidential information from a single person.

Section 44, “Right to remain silent”, states:

  1. Members of the police personnel are not obliged to reveal the identity of the person who has provided them with confidential information during their employment relationship or to reveal any secret tactical or technical methods. (525/2005)
  2. Members of the police personnel are not obliged to disclose information on the identity of a person making undercover transactions or involved in undercover activities, if the disclosure could endanger the safety of the person making undercover transactions or involved in undercover activities or their close family members, similar future activities of the person making undercover transactions or involved in undercover activities, or the success of the information gathering. (525/2005)
  3. However, if an extremely weighty cause exists, a court may order the information referred to in subsection 1 or 2 to be revealed if a public prosecutor is prosecuting for an offence carrying a possible sentence of six or more years in prison. Even then the court cannot order the identity of persons who provided information or of a person who made an undercover transaction or was involved in undercover activities to be revealed if this would manifestly pose a serious threat to their safety or that of their family. (21/2001)”

Duty of confidentiality

The Criminal Code of Finland (39/1889)12

In Finland, civil servants are subject to criminal law and they are in a special position in terms of the Finnish Penal Code. Concerning only civil servants, there is a group of acts, which belong to maladministration or mismanagement and are separately criminalized as malfeasance, offence in office and have severe punishments, such as dismissal or admonition.

The Penal Code of Finland contains a chapter concerning offences in office. The wrongdoings listed in the Penal Code are:

  1. acceptance of a bribe and aggravated acceptance of a bribe,
  2. bribery violation,
  3. acceptance of a bribe as a Member of Parliament,
  4. breach and negligent breach of official secrecy,
  5. abuse of public office and aggravated abuse of public office, and
  6. violation of official duty and negligent violation of official duty.

Penal Code Chapter 38

Section 1, “Secrecy offence”, states:

”A person who in violation of a secrecy duty provided by an Act or Decree or specifically ordered by an authority pursuant to an Act

  1. discloses information which should be kept secret and which he or she has learnt by virtue of his or her position or task or in the performance of a duty, or
  2. makes use of such a secret for the gain of himself or herself or another shall be sentenced, unless the act is punishable under chapter 40, section 5, for a secrecy offence to a fine or to imprisonment for at most one year.”

Section 2, “Secrecy violation”, states:

  1. “If the secrecy offence, in view of the significance of the act as concerns the protection of privacy or confidentiality, or the other relevant circumstances, is petty when assessed as a whole, the offender shall be sentenced for a secrecy violation to a fine.
  2. Also a person who has violated a secrecy duty referred to in section 1 and it is specifically provided that such violation is punishable as a secrecy violation, shall also be sentenced for a secrecy violation.”

Penal Code Chapter 40

Section 5, “Breach and negligent breach of official secrecy”, states:

”If a public official deliberately, while in service or thereafter, unlawfully

  1. discloses a document or information which under the Act on the Openness of Government Activities (621/1999) or another Act is to be kept secret or not disclosed, or
  2. makes use of the document or information referred to in paragraph (1) to the benefit of himself/herself or of another, or to the loss of another he/she shall be sentenced, unless a more severe penalty for the act has been laid down elsewhere, for breach of official secrecy to a fine or to imprisonment for at most two years. A public official may also be sentenced to dismissal if the offence demonstrates that he/she is manifestly unfit for his/her duties.

If a public official commits the offence referred to in subsection 1 through negligence, and the act, in view of its harmful and damaging effects and the other relevant circumstances, is not of minor significance, he/she shall be sentenced, unless a more severe penalty for the act is provided elsewhere in the law, for negligent breach of official secrecy to a fine or to imprisonment for at most six months.”

Journalistic context

In Finland there is statutory protection for journalistic source, under legislation dating back to the foundation of the state in 1918. The exception occurs in criminal cases where the penalty is more than six years in prison and there is no other means of securing the information. The old legislation covered only press and broadcasting — not book publishing or the Internet. A recent case involving a reference to the company Sonora in a book, exposed this loophole, as the company sought to identify the source. To their credit, Finnish legislators moved quickly (by European standards) to plug the loophole and an amendment due to come into effect in 2004 extends protection of sources to books and the Internet.13

According to the Act Exercise of Freedom of Expression in Mass Media (460/2003)14, confidentiality of sources and right to anonymous expression is guaranteed in the media:

Section 16 states:

”The originator of a message provided to the public, the publisher and the broadcaster are entitled to maintain the confidentiality of the source of the information in the message. In addition, the publisher and the broadcaster are entitled to maintain the confidentiality of the identity of the originator of the message.

Also a person who has become aware of the confidential information referred to in subsection (1) while in the service of the originator of the message, the publisher or the broadcaster is similarly entitled to maintain that confidentiality.

Separate provisions apply to the duty to disclose confidential information referred to in subsection (1) in a pre-trial investigation or court proceedings.”

Private Sector

The Finnish rules on employment protection in the Employment Contracts Act aim to create security for employees without preventing effective management and a smooth adjustment of the workforce to the labor supply. The basic instruments of employment protection are individual and collective redundancy protection, termination of the employment relationship and dismissal. These instruments were recently revised in Finnish law in conjunction with the adoption of the new Employment Contracts Act 2001.

Employment Contracts Act (55/2001, below referred to as ECA)15

Chapter 1 – General Provisions

Section 1, “Scope of application”, states

”This Act applies to contracts (employment contract) entered into by an employee, or jointly by several employees as a team, agreeing personally to perform work for an employer under the employer’s direction and supervision in return for pay or some other remuneration.

This Act applies regardless of the absence of any agreement on remuneration, if the facts indicate that the work was not intended to be performed without remuneration.

Application of the Act is not prevented merely by the fact that the work is performed at the employee’s home or in a place chosen by the employee, or by the fact that the work is performed using the employee’s implements or machinery.”

Section 2, “Derogations from scope of application”, states:

”This Act does not apply to:

  1. employment relations or service obligations subject to public law;
  2. ordinary hobby activities;
  3. such contracts on work to be performed which are governed by separate provisions by law.”

Chapter 3 – Employees’ Obligations

Section 1, “General obligations”, states:

”Employees shall perform their work carefully, observing the instructions concerning performance issued by the employer within its competence. In their activities, employees shall avoid everything that conflicts with the actions reasonably required of employees in their position.”

Section 2, “Occupational safety and health”, states:

”Employees shall observe the care and caution required by their work duties and working conditions and apply all available means to ensure their own safety and the safety of other employees at the workplace.

Employees shall notify the employer of any faults or deficiencies they may detect in the structures, machinery, equipment and work and protection implements of the workplace which may cause risk of accident or illness.”

Termination of employment

Termination on personal grounds (grounds for termination linked to the person of the employee) requires objective and weighty reasons since the employer is terminating without the consent of the employee. Objective and weighty reasons for termination on personal grounds flow from an overall assessment. All the relevant facts of the case need to be taken into account when assessing whether the measure is reasonable.

Chapter 7 – Grounds for Termination of the Employment Contract by Means of Notice

Section 1, “General provision on the grounds for termination of an employment contract”, states:

”The employer shall not terminate an indefinitely valid employment contract without proper and weighty reason.”

Section 2, “Termination grounds related to the employee’s person”, states:

”Serious breach or neglect of obligations arising from the employment contract or the law and having essential impact on the employment relationship as well as such essential changes in the conditions necessary for working related to the employee’s person as render the employee no more able to cope with his or her work duties can be considered a proper and weighty reason for termination arising from the employee or related to the employee’s person. The employer’s and the employee’s overall circumstances must be taken into account when assessing the proper and weighty nature of the reason.

At least the following cannot be regarded as proper and weighty reasons:

  1. illness, disability or accident affecting the employee, unless working capacity is substantially reduced thereby for such a long term as to render it unreasonable to require that the employer continue the contractual relationship;
  2. participation of the employee in industrial action arranged by an employee organization or in accordance with the Collective Agreements Act;
  3. the employee’s political, religious or other opinions or participation in social activity or associations;
  4. resort to means of legal protection available to employees.

Employees who have neglected their duties arising from the employment relationship or committed a breach thereof shall not be given notice, however, before they have been warned and given a chance to amend their conduct.

Having heard the employee in the manner referred to in chapter 9, section 2, the employer shall, before giving notice, find out whether it is possible to avoid giving notice by placing the employee in other work.

What is provided in paragraphs 3 and 4 need not be observed if the reason for giving notice is such a grave breach related to the employment relationship as to render it unreasonable to require that the employer continue the contractual relationship.”

The Employment Contracts Act (7:2) specifies in general terms reasons for termination which may be viewed as objective and weighty and thus provide legal grounds for the employer to terminate the contract of employment. In addition, in accordance with previous practice, the Act specifies reasons for termination which are not acceptable. There are two types of objective and weighty reasons for termination on personal grounds:

  1. a serious breach of the employee’s obligations towards the employer. This concerns obligations which follow from the employment contract or from the law, and these obligations must be of significance to the employment relationship.
  2. a significant change in the employee’s personal circumstances which cause him to no longer be able to carry out his work duties. The draft legislation reveals that this provision was not intended for situations where the employee’s capacity for work is reduced as a result of illness or disability.

An employee who has failed to observe his obligations may not, as a general rule, be terminated if the employer has failed to give him a warning. There is nothing in the law that describes what a warning may look like.

The objective and weighty grounds for termination are also delimited by negative definitions. The Employment Contracts Act lists individual reasons that are not considered acceptable grounds for dismissal. Some of them are categorical, while others are of a more relative nature.

Prior to carrying out a dismissal, the employer shall hear the employee in order to ascertain whether the dismissal might be avoided by transferring the employee to another job (7:2, subsection 4). If the grounds for dismissal constitute such a serious breach that it would be unreasonable to expect the employer to continue the employment relationship, the employer need neither warn the employee nor consider the possibility of a transfer (7:2, subsection 5).

Chapter 8 – Cancellation of the Employment Contract

Section 1, “Grounds for cancellation”, states:

”The employer is only upon an extremely weighty cause entitled to cancel an employment contract with an immediate effect regardless of the applicable period of notice or the duration of the employment contract. Such a cause may be deemed to exist in case the employee commits a breach against or neglects duties based on the employment contract or the law and having an essential impact on the employment relationship in such a serious manner as to render it unreasonable to expect that the employer should continue the contractual relationship even for the period of notice.

Correspondingly, the employee shall be entitled to terminate the employment contract with immediate effect if the employer commits a breach against or neglects its duties based on the employment contract or the law and having essential impact on the employment relationship in such a serious manner as to render it unreasonable to expect that the employee should continue the contractual relationship even for the period of notice.”

Chapter 9 – Procedure for Terminating an Employment Contract

Section 2, “Hearing the employee and the employer”, states:

”Before the employer terminates an employment contract on the grounds referred to in chapter 7, section 2, or cancels it for a reason referred to in chapter 1, section 4, or chapter 8, section 1, the employer shall provide the employee with an opportunity to be heard concerning the grounds for termination. The employee is entitled to resort to an assistant when being heard.

Before the employee cancels an employment contract on the grounds referred to in chapter 8, section 1, the employee must provide the employer with an opportunity to be heard concerning the grounds for cancellation.”

Unlawful dismissal

An employer who has terminated an employee’s employment contract on grounds other than those provided for in the Employment Contracts Act must pay compensation (korvaus) to the employee of between three and 24 months’ pay. However, for the unlawful dismissal of an employee representative or delegate, this may rise up to 30 months’ pay.

Chapter 12 –Liability for Damages

Section 2, “Compensation for groundless termination of an employment contract”, states:

”If the employer has terminated an employment contract contrary to the grounds laid down in this Act, it must be ordered to pay compensation for unjustified termination of the employment contract. If the employee has cancelled the employment contract on the grounds laid down in chapter 8, section 1, arising from the employer’s intentional or negligent actions, the employer must be ordered to pay compensation for unjustified termination of the employment contract. The exclusive compensation must be equivalent to the pay due for a minimum of three months or a maximum of 24 months. Nevertheless, the maximum amount due to be paid to shop stewards elected on the basis of a collective agreement or to elected representatives referred to below in chapter 13, section 3, is equivalent to the pay due for 30 months.

Depending on the reason for terminating the employment relationship, the following factors must be taken into account in determining the amount of compensation: estimated time without employment and estimated loss of earnings, the remaining period of a fixed-term employment contract, the duration of the employment relationship, the employee’s age and chances of finding employment corresponding to his or her vocation or education and training, the employer’s procedure in terminating the contract, any motive for termination originating in the employee, the general circumstances of the employee and the employer, and other comparable matters.

If the employer has terminated the employment contract contrary to the grounds laid down in chapter 7, sections 3 or 7, or cancelled it contrary to the grounds laid down in chapter 1, section 4, or solely contrary to the grounds laid down in chapter 8, section 1, the provision in paragraph 1 on minimum compensation shall not apply.”

Apart from the fact that damages are intended to compensate for an injury suffered, they also have a penal purpose. An unfairly dismissed employee who has not suffered a material injury is nevertheless entitled to minimum compensation. It is clear from the provisions on compensation that the intention was to make the employer pay the employee affected for the breach of the law alone. However, this protection is incomplete as regards employment relationships in that it does not directly safeguard the employee’s right to continue working at the workplace in question. Unless it has been agreed otherwise, dismissal without valid grounds therefore still results in the end of the employment relationship.

The same applies to all other ways of terminating an employment relationship.

Duty of confidentiality

In accordance with the 2001 Contracts of Employment Act, while their employment relationship is in progress employees may not exploit or divulge to third parties their employer’s business and trade secrets. This statutory prohibition continues after the employment has ended in the case of information that the employee has obtained unlawfully. In such circumstances the prohibition remains valid without any endpoint in time.

Section 4 – “Business and trade secrets”

”During the term of employment, the employee may neither utilize nor divulge to third parties the employer’s trade or business secrets. If the employee has obtained such information unlawfully, the prohibition continues after termination of the employment relationship.

Liability for any loss incurred by the employer is extended not only to the employee divulging confidential information but also to the recipient of this information, if the latter knew or should have known that the employee had acted unlawfully.”

In the case of business and trade secrets that have come to an employee’s knowledge lawfully in the course of the employment relationship, it can be agreed in the contract of employment or a covenant at individual level that their confidentiality is to continue for at least a certain period after the employment ends. Such secrets can include financial, technical or manufacturing-process information, but information on the employer’s customers that has come to the employee’s knowledge lawfully can also be information that must be kept confidential if this has been agreed. The length of time for which it can be agreed that confidentiality is to continue after the employment ends depends on the particular situation and factors such as the information becoming out of date. If a covenant in restraint of competition has been concluded to cover a certain period after the employment ends, confidentiality can also be agreed for at least the same length of time. See loyalty (principle of), trade (business) secret.16

Data Protection Ombudsman

The Finnish Data Protection Ombudsman has published guidance on compliance hotlines. The guidelines set out the data protection requirements arising from the Finnish Personal Data Act (henkilötietolaki) and the Act on the Protection of Privacy in Working Life (työelämän tietosuojalaki) in the context of whistleblowing hotlines. The main obligations arising from the guidance require companies to17:

  • Consult employee representatives before implementing a whistleblower scheme.
  • Limit the information processed through the hotline to data concerning:

    • accounting;
    • financial matters;
    • banking; or
    • anti-bribery matters.
  • Inform any employees who are subject to a complaint about the complaint before using the relevant data in making any decision concerning the employee (for example, the decision to take disciplinary or related proceedings).
  • Ensure that employees referenced in compliance reports have a right to learn the identity of the employee submitting the report.
  • Establish clear retention periods for storing hotline data and ensure that data is not kept longer than is necessary to conduct the internal investigation, unless disciplinary or judicial procedures have started, in which case the data can be retained until such procedures are concluded.
  • Ensure that data is protected with adequate organisational and technical security mechanisms and designate a data-security controller (that is, an individual responsible for responding to questions and overseeing the system).

There is generally no requirement to notify the whistleblowing hotline to the Data Protection Ombudsman unless the operation of the hotline has been outsourced to a third party. Notification requirements might also arise if the personal data collected through the hotline is transferred outside the EEA.

Citizens’ Initiative

In 2012 by the support of national constitutional amendment Citizens’ Initiative’s became possible as a form of legislative initiative in Finland. In practice, if 50 000 citizens’ signatures are gained in support of a Citizens’ Initiative within a six month period, the initiative is valid for further processing on the parliaments’ legislative agenda.

Lex Snowden

On July 8th 2013, Electronic Frontier Finland (Effi), with support from Open Ministry18, submitted the citizens’ legislative initiative “Lex Snowden”—“Yes we can – Law for protecting freedom of speech and privacy internationally—to the Ministry of Justice19.

The Lex Snowden initiative was aimed at criminalizing spying on citizens. It sought to considerably enhance protection of whistleblowers in Finland, and require authorities and organisations to report on the collection and use of citizens’ data.
The Lex Snowden initiative was comprised of three main elements:

  • It sought to add new articles to the Criminal Code, which would criminalize excessive surveillance of citizens. A crime that would be defined as a “universal crime”, meaning it prosecution in Finland would be possible even if the act had taken place in another country. Penalties against companies that participate in illegal surveillance would also be introduced. For example a Finnish court could impose a corporate fine, the amount of which would be a maximum of 25% of the company’s total international revenue.
  • It sought to substantially extend the reporting liabilities of authorities’ and telecom operators’ regarding their mass personal data collection, storage and use. Currently, the Ministry of the Interior reports about data retention practices only to the EU Commission and companies are not currently required to report about their respective data collection practices at all.
  • It sought to close the legislative gaps related to the granting of protection for whistleblowers, which were revealed in the case of Edward Snowden. The proposal sought to make the extradition of whistleblowers impossible and to ensure they could no longer be prevented from obtaining an entry or residence permit.20

The initiative was unsuccessful, having only received 4 179 supporters out of 50,000 required for the initiative to be processed by the Parliament. However, while the initiative failed to receive the required number of signatories, it received widespread publicity in the media and highlighted critical gaps and flaws in national legislation with regard to excessive data collection and protection of whistleblowers21.

Case Law

In Finland disputes concerning the Employment Contracts Act are handled by the general courts, thus by the Supreme Court as the highest instance. Certain issues concerning employment protection (for example procedure in conjunction with dismissal) may be regulated, however, by the collective agreement under the provisions of Chapter 13 section 7 of the Employment Contracts Act, and disputes concerning interpretation of the collective agreement are handled by the Labor Court.

The Turun Sanomat reported on 27 February 2012 that the State-owned passenger rail operator VRGroup is considering taking court action against the internet whistleblowing website VRLeaks, which has accused the company of maintaining its monopoly through illegal means. 22 No action has been taken to date.

Other than this, no cases concerning whistleblowing in Finland.

Gaps

The protection against dismissal is incomplete as it does not directly safeguard the employee’s right to continue working at the workplace in question – the sanction incurred by the employer for unlawful dismissal is only liability to pay compensation and in certain special circumstances also, inter alia, a fine.

For private employees, there are no formal disciplinary procedures in cases of misconduct on behalf of the employee (for public employees there are rules about warnings).


1 The following section concerning general information regarding corruption in Finland is mostly gathered from Esa Käyhkö, International Conference ”Preventing and fighting against corruption in the public administration in Europé”, 20-21 February 2006, Workshop 3: Protection of whistleblowers and informants. Retrieved at: http://www.dbbakademie.de/fileadmin/dokumente/Tagungen/Korruption_2006/Abstract_kayhko.pdf.

2 http://www.transparency.org/policy_research/surveys_indices/cpi

3 http://www.finlex.fi/fi/laki/kaannokset/1999/en19990731.pdf

4 The following section concerning general information regarding labour regulations in Finland is mostly gathered from the official brochure entitled ”Finnish Labour Legislation and Industrial Relations”, Ministry of Employment and the Economy. Retrieved at: http://www.tem.fi/files/31813/Finnish_Labour_Legislation.pdf.

5 http://www.finlex.fi/fi/laki/kaannokset/2003/en20030434.pdf

6 http://www.finlex.fi/fi/laki/kaannokset/1999/en19990731.pdf

7 Translated from Swedish to English. The Swedish translation is available here: http://www.finlex.fi/sv/laki/ajantasa/1994/19940750

8 Translated from Swedish to English. The Swedish translation is available here: http://www.finlex.fi/sv/laki/ajantasa/2003/20030304

9 A link to the guidelines: http://www.vm.fi/vm/en/04_publications_and_documents/01_publications/06_state_employers_office/20050114Values/Values_in_the_daily_job.pdf

10 http://www.finlex.fi/en/laki/kaannokset/2006/en20060044

11 http://www.finlex.fi/fi/laki/kaannokset/1995/en19950493.pdf

12 http://www.finlex.fi/en/laki/kaannokset/1889/en18890039.pdf

13 European Federation of Journalists, ”Protecting our Sources of Information”. Retrieved at: http://www.statewatch.org/news/2005/dec/ifj-sources-handbook.pdf.

14 http://www.finlex.fi/en/laki/kaannokset/2003/en20030460.pdf

15 http://www.finlex.fi/en/laki/kaannokset/2001/en20010055.pdf

16 Eurofound, Duty of Confidentiality in Finland. Retrieved at: http://www.eurofound.europa.eu/emire/FINLAND/ANCHOR-SALASSAPITOVELVOLLISUUSTYSTNADSPLIKT-FI.htm.

17 A link to the guidelines may be found here (in Swedish): http://www.tietosuoja.fi/uploads/5datpuq0.pdf.

18 Open Ministry (Avoin Ministeriö)is a Finnish non-profit organization which supports crowdsourcing legislation, deliberative and participatory democracy and citizens’ initiatives.

19 https://edri.org/edrigramnumber11-14finland-lex-snowden/

20 http://www.ifla.org/node/8386

21 https://www.kansalaisaloite.fi/fi/aloite/442

22 http://www.helsinkitimes.fi/news/index.php/finland/finland-news/domestic/1498-ts-vrgroup-to-consider-suing-whistleblowing-website