Collective agreements and mediation in labour disputes

Collective agreements

A collective agreement is an agreement made by one or more employers or an employers’ association with one or more employees’ unions concerning conditions which must be complied with in contracts of employment or employment relationships. Collective agreements serve two important purposes:

  1. They lay down the minimum terms of employment and
  2. they oblige the parties to observe industrial peace.

If an employment contract is in any respects in contradiction of the collective agreement for the relevant sector of industry the contract is null and void for the sections concerned and the equivalent provisions in the collective agreement must be observed instead.

The general applicability of a national collective agreement is determined by the committee confirming the general applicability of collective agreements, which operates under the auspices of the Ministry of Social Affairs and Health.

The parties that have concluded a collective agreement must submit the collective agreement and the associated documents to the Ministry of Social Affairs and Health within one month of the signing of the agreement. The employer party must submit a copy of the agreement in writing and by e-mail so that the generally applicable agreement can be published on the Internet.

The parties to a collective agreement are responsible for ensuring that its provisions are observed.

Mediation in labour disputes

A system of mediation in labour disputes has been established for dealing with conflicts between parties in working life. The mediation system has been set up for the labour market organisations so that disputes can be resolved through negotiation.

In cases of mediation in labour disputes the negotiating partners are assisted by a national conciliator and conciliators. The labour market central organisations may also use a national conciliator to assist them in concluding a collective agreement.

Litigations over the content or breaches of collective agreements can be referred to the Labour Court. The Labour Court’s jurisdiction relates to a collective agreement’s legitimacy, validity, content, scope and the correct interpretation of any of its clauses. The Labour Court can also decide on how much in compensatory damages is to be paid out following unlawful industrial action. Its decision is final.

Legal disputes over an employment relationship not linked to a collective agreement binding on the employer by virtue of the Collective Agreements Act are dealt with by general courts.

Further information:

Law-drafting: Tarja Kröger, tarja.kroger(at)