Impact assessments on companies, employment and working life in legislative drafting 

Within the Government, the Ministry of Economic Affairs and Employment is responsible for developing the impact assessments on companies, employment and working life. The assessment of impacts of legislative proposals on companies, employment and working life is based on the Government’s common guidelines.

• Guidelines for Impact Assessment in Law Drafting

The guidelines discuss the analysis of economic impacts, impacts on the authorities, environmental impacts and other social impacts. Impacts on companies are examined as part of economic impacts. Impacts on working life and employment fall under other social impacts.

• Development of law drafting | oikeusministerio.fi

Impact assessment of legislation on companies

The Ministry of Economic Affairs and Employment promotes the consideration of impacts on companies in law drafting, supports law drafters in assessing company impacts and develops methods for that purpose.

When assessing the impacts on companies, it is important to examine the effects of regulation and different implementation options on:

• companies’ costs and revenue (e.g. administrative burden)
• competition between companies and the functioning of the market
• SMEs, entrepreneurship and opportunities for business growth
• companies’ investments and innovation
• international competitiveness of companies

SME impact checklist (SME test) (in Finnish)

Read more

• Streamlining regulation | tem.fi
• Innovation-friendly regulation | tem.fi

Fictional examples

• Example of the working life impacts of the Annual Holidays Act (in Finnish)
• Example of lifting restrictions on shop opening hours (in Finnish)

With regard to government proposals other than those relating to working life, the question is of indirect impacts of the proposal on working life. How and in which order working life impacts are addressed must always be considered separately. The examples above are intended to help in the perception of possible impacts on working life.

In particular, it should be noted that assessing the impact of a legislative proposal on equality in working life and the economic impact on the employer could be justified as part of the working life assessment instead of the impact assessment on equality or economic impact.

Assessment framework of employment impacts

Assessing employment impacts of legislation has the same foundations as the assessment of such impacts carried out in other contexts following policy changes. The methods used in the assessment depend on e.g. whether the aim is to assess not only direct but also various indirect impacts. The impacts may also differ in the short and long term. The selection of an appropriate assessment method also depends on the available data.

It is important to identify possible impact mechanisms already at an early stage of legislative drafting to determine if an assessment of employment impacts should be carried out or not. In addition to the employment impacts that the legislative amendment aims to achieve, the assessment should also identify undesirable impacts.

• Assessment framework of employment impacts (in Finnish)

This simple framework makes it possible to identify whether the impacts are related to labour demand, labour supply and/or labour market balance.  Similar to the checklist, the framework provides a systematic way to examine different types of employment impacts. It is not in itself an impact assessment tool, but rather an instrument for identifying whether an impact assessment should be carried out.

A number of examples have been produced using the framework. Some of them are fictitious, but others are actual legislative amendments that have been implemented.

• Examples of analysing employment impacts (in Finnish)