PAM: Draft law on zero-hours contracts contains major flaws

The Finnish government’s proposal on the status of persons working atypical and fragmented working hours only applies to some part-time workers. Thus the draft discriminates between different groups of part-time workers and increases inequality.

“The draft does not properly take into account the number of workers doing part-time work. In service sectors – for example in sales and cleaning work and in restaurants – there is a lot of part-time work. On average 84,000 wage-earners in Finland work on zero-hours contracts, and the majority of them are young and female, says PAM’s lawyer Karoliina Huovila.

Today Friday Huovila was auditioned by the Finnish Parliament’s Employment and Equality Committee. The law submitted by the government is due to come into force at the start of June 2018.

The draft is based on a desire to improve the job security of persons working on zero-hours contracts, i.e. flexible working hours (0-40 hours a week), and to limit the use of so-called zero- contracts. The draft now talks about variable working hours rather than zero-hours contracts.

PAM’s research indicates that people on zero-hours contracts are already finding it difficult to make ends meet on what they are paid.
“For employees, widespread use of part-time work often means low earnings and unpredictable shifts since their working hours and workload fluctuate wildly,” Huovila points out.

A study conducted by PAM in 2016 shows that serious financial worries are more common among persons on zero-hours contracts than among employees on contracts with agreed working hours. The study shows that over half of those on zero-hours contracts would like to work full-time.
Among other things, the government’s draft addresses extra hours. Employees must give their consent for extra hours, which in Huovila’s opinion is a key factor when considering whether contract hours and workload match up.

“The consent to extra hours may also create a significant barrier to employment for the worker. It may be impossible for part-time workers to accept work from another employer if the amount of work on offer cannot be predicted at all”, Huovila states.

Under Section 18, 3 of the proposed new Working Hours Act, employees on variable working hours cannot be asked to give so-called “outright” consent to extra hours. At workplaces, however, the problem also applies to part-time workers on fixed hours. In PAM’s opinion, part-time workers should not give outright consent to extra hours either, in order to preserve symmetry between the parties of part-time employment contracts.

Under the government’s proposal, when variable working hours are used employers should estimate the amount of work, but this estimate would not be binding on the employer. Under the proposal, however, variable working hours could be agreed at the employee’s initiative. Huovila says that PAM considers the proposal inadequate in its current form.
“We consider the proposal worthless because the estimate is not binding on the employer. Making working hours regular is an effective way to curb the unjustified use of part-time labour.”

Huovila points out that often workers are not properly able to negotiate the content of their employment contract when it is concluded.
“It seems strange to imagine that variable working hours would be agreed at the employee’s initiative if the employer’s labour needs are constant. The law should be enacted in such a way that variable working hours cannot be agreed if the employer’s labour needs covered by the contract are constant”, Huovila stresses.

Service Union United PAM has been involved in the preparatory work on zero-hours legislation together with the government and labour market confederations. Consultations with the Parliament’s Employment and Equality Committee continue.

Take a look at the government proposal here (in Finnish).