Legislative amendments enter into force: higher threshold for applying the Co-operation Act and shorter duration of change negotiations

The amendments to the Act on Co-operation within Undertakings (Co-operation Act) will enter into force on 1 July 2025. The aim is to reduce the administrative burden caused by the current legislation, especially in companies with fewer than 50 employees. Another objective is to speed up the ability of all companies to react to changes in the operating environment.

“The legislative reform will improve the operating conditions for SMEs, in particular, which have significant potential to grow and hire more employees. The changes to the Co-operation Act will reduce bureaucracy and the administrative burden on companies. This reform will reinforce the Government’s policies on work and entrepreneurship,” says Minister of Employment Matias Marttinen.

Going forward, the Co-operation Act will apply to companies, corporations and branches that regularly employ at least 50 people. However, employers who regularly employ 20–49 employees must still comply with certain obligations arising from the Act.

Under the amended Act, change negotiations concerning the reduction of workforce must last at least three weeks or seven days. The minimum duration of the change negotiations depends on the matters to be negotiated and the number of employees at the company or corporation.

Reforming the Co-operation Act is one of the Government’s labour market reforms. The first phase of the legislative project implemented the Government Programme’s entries on raising the threshold for applying the Co-operation Act and reducing the minimum duration of change negotiations by half. The second phase of the project focuses on the possible changes to the board-level employee representation. A tripartite working group has been appointed to prepare the changes. Its term will end on 31 December 2025.

Inquiries:
Jaakko Aromaa, Special Adviser to the Minister of Employment, tel. +358 295 047 110
Elli Nieminen, Chief Specialist, Ministry of Economic Affairs and Employment, tel. +358 295 047 056 (available for comment 1–4 July and from 4 August)
Nico Steiner, Senior Ministerial Adviser, Ministry of Economic Affairs and Employment, tel. +358 295 049 001 (available for comment 21 July–1 August)