Collective agreements for the various fields of industry on the terms and conditions of work are bargained for by a trade union (or a group of trade unions) with an employer or an employers’ federation. Once the negotiations have been concluded the terms of the resultant agreement shall be applied to the employees who work in that field. Different collective agreements are, in general, bargained for each field of work and each group of workers may have their own collective agreement (blue collar workers, white collar workers, supervisors).
The municipal and the state sector have their own collective agreements. These are similar in their content to the private sector collective agreements, and the information given above on collective agreements, in general, also applies to these agreements.
Wages and salaries, pay increases and benefits which exceed those which are decreed by law, for example, those for annual leave and working hours, are bargained for when collective agreements are negotiated for any particular sector. In addition, it is stated in the collective agreements to what extent employment issues can be negotiated at the local company level.
The level of wages and salaries, as well as any benefits, which have been agreed upon with a collective agreement, will always represent a minimum, which must not be lowered. However, better terms than those which are stated in the collective agreement can be agreed upon in an employment contract reached locally or at the workplace.
Should an employment contract between an employee and an employer contain a term which is less advantageous to the employee than the relevant term as stated in the collective agreement, then the term in the employment contract will be invalid and the corresponding term in the collective agreement will be applied.
A collective agreement is usually negotiated for a set period, most commonly for the term of 1 to 3 years. Industrial peace will prevail during this period, which means that industrial action, i.e. strikes, will be prohibited in any area which is covered by the agreement.
Some 200 national collective agreements are regularly negotiated in Finland. In addition to these, there are company agreements which are negotiated between the trade unions and individual companies. The trade unions which are affiliated to STTK negotiate a total of some 250 collective agreements.