Chair of the Employment and Equality Committee Arto Satonen (National Coalition Party, centre) at a press conference in Parliament in Helsinki on 11 December 2025 concerning the change to personal grounds for dismissal. Photo: Antti Aimo-Koivisto / Lehtikuva
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Parliament has approved a legislative proposal that will lower the threshold for terminating employment contracts on personal grounds. Under the proposed reform, employers will no longer need to show a “weighty reason” to dismiss an employee. An “appropriate reason” will be sufficient.
The law is expected to come into effect at the start of 2026 if passed by the full Parliament. It applies to employment contracts in both the private and public sectors, excluding civil service roles.
Arto Satonen, chair of the Parliament’s Employment and Equality Committee and a former Minister of Employment, confirmed that the committee supports the government’s proposal in full.
“The aim is to reduce barriers to employment and support small and medium-sized businesses,” Satonen said at a press briefing. “Recruiting even one employee is a major decision for a small firm.”
The reform will not affect layoffs resulting from redundancy or structural changes, nor will it change the procedures for dismissing civil servants.
The committee has proposed a separate statement urging future governments to evaluate the dismissal threshold for civil servants to avoid legal disparity between public and private sector workers.
Civil service employment rules fall under a separate legal regime, and any changes would require a new proposal by a future administration.
The opposition, including the Social Democrats, Greens, and Left Alliance, strongly criticised the law. Lauri Lyly, the committee’s deputy chair from the SDP, described the reform as a direct weakening of employee protection.
“This bill lowers the minimum protection level for all wage earners. No one knows how far the threshold will drop, and it will take years for case law to stabilise,” Lyly said.
The opposition also raised concerns about the potential rise in workplace discrimination, especially in sectors already affected by insecure working conditions.
Greens MP Fatim Diarra said the committee had received testimony warning that the new law could increase pregnancy and parental leave discrimination. In response, the committee included a clause requiring the monitoring of such risks until 2028.
The Centre Party, which is not part of the governing coalition, proposed limiting the new dismissal rules to companies with fewer than 20 employees. MP Olga Oinas-Panuma argued that this would address the challenges faced by small businesses without affecting sectors like public healthcare and education, where employment is often unstable.
Opposition parties have labelled the reform the “termination law,” claiming it favours employers and increases legal uncertainty for workers. They also warn that the change could disproportionately harm young people, women, and low-income earners.
According to Lyly, around 12,400 people are dismissed each year in Finland for personal reasons, and a further 14,600 during probation periods. The new law, he argued, would heighten the risk of dismissal across all sectors.
Despite the disagreement, the Employment and Equality Committee approved the proposal with majority support. Two formal dissenting opinions were included in the final report.
HT
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Source: www.helsinkitimes.fi
