Direct Request (CEACR) - adopted 2016, published 106th ILC session (2017)

Labour Clauses (Public Contracts) Convention, 1949 (No. 94) - Finland (Ratification: 1951)

The Committee notes the observations of the Central Organization of Finnish Trade Unions (SAK), the Confederation of Unions for Professional and Managerial Staff in Finland (AKAVA) and the Finnish Confederation of Professionals (STTK), communicated with the Government’s report. The workers’ organizations refer to their joint statement of 2006 in which they underlined the lack of clarity in relation to whether municipalities could be considered central authorities within the meaning of Article 1(1) of the Convention, and noted that in Finland the Convention is not deemed to apply to contracts concluded by municipalities. The Committee requests the Government to provide its comments in this respect.

Articles 1(1) and 2(1) and (3) of the Convention. Scope of application. Contractual provisions. Determination of clauses after consultations with social partners. The Government provides an overview of legislative amendments made in 2012 and 2015 to the Act on the Contractor’s Obligations and Liability when Work is Contracted Out. The Act, which applies when contractors use temporary agency workers or labour based on a subcontracting agreement, require the contractor to check the subcontractors’ and user enterprises’ adherence to their obligations under legislation. As part of this check, contractors are required to obtain information from the subcontractor including on pension insurance, tax payments, the collective agreement or other principal terms of employment, and accident insurance. The 2012 amendments added specific regulations related to the construction industry, including the adoption of higher fines for negligence in construction. The additional reforms in 2015 aim to standardize practices across all industries and facilitate contractors’ adherence to their obligations. The contractor’s checking obligation is now expanded to occupational health care, as well as to pension security for workers mediated from abroad. Fines for negligence have also been increased in the event where the contractor neglects the obligation to perform the checks specified. The Government further indicates that, as part of the current comprehensive reform of the Finnish procurement legislation, a legislative proposal was introduced in Parliament on 22 June 2016 which aims to expand the compliance obligation for terms of employment so that the obligation includes all contract types covered by the Convention. The proposal states that “A public works contract awarded by a central government authority to a private employer shall be accompanied by a clause according to which the work relating to the public works contract shall comply with the minimum terms of employment which must be observed in similar work pursuant to Finnish law and collective agreements”. The Committee requests the Government to indicate whether the reforms include clauses ensuring workers’ rights in relation to wages (including allowances), hours of work and other conditions of labour. The Committee further requests the Government to provide information on the manner in which organizations of employers and workers have been consulted and participated in the determination of the terms and clauses to be included. It further requests the Government to provide information on any developments in amending the public procurement legislation and to provide a copy of the text as soon as it is adopted.

Article 2(4). Ensuring tenderers are aware of labour clauses. In reply to the Committee’s previous comments, the Government indicates that the Ministry of Justice maintains a free and open database which contains the texts of generally applicable collective agreements as well as agreements between the central labour market organizations. In addition, compliance with these agreements as part of the collective agreements is stipulated in every collective agreement. The Government further indicates that notice forms for public procurement procedures provide contracting authorities the possibility of referring to the applicable legislation and collective bargaining agreements in different parts of the notification forms. Recalling its previous comment that informing tenderers of labour clauses seems to be left to the discretion of the contracting authorities, the Committee once again requests the Government to provide information on the manner in which it is ensured that tenderers have prior knowledge of the terms of the labour clauses.

Article 4. Posting of notices. Notification of all persons concerned. The Committee previously requested the Government to indicate the measures, taken or envisaged, to ensure that workers engaged in the execution of public contracts are informed of the working conditions applicable to them through the posting of notices at the workplace, as prescribed by Article 4(a)(iii) of the Convention. The Government provides information on the legal measures regarding notification and posting of collective agreements at workplaces, in accordance with the laws on employment contracts (No. 55/2001) and on collective agreements (No. 436/1946). The Committee recalls that the abovementioned obligations also apply to laws, regulations and other instruments that give effect to the Convention. Consequently, the Committee reiterates its requests that the Government indicate how it is ensured that information concerning the applicable laws and regulations are brought to the notice of all persons concerned and how it is ensured that persons responsible for complying with this obligation are defined. It further requests the Government to provide examples of the notification forms on public procurements.

Article 5. Penalties. The Government indicates that the Act on Public Contracts (No. 348/2007), being part of the Finnish procurement legislation currently under review, sets out the legal remedies available for violations of the Act. If an application is made to the Market Court, as the special court tasked with handling procurement cases, the Court is authorized to: (1) cancel a contracting authority’s decision in part or in full; (2) forbid the contracting authority from applying an incorrect section in a document relating to the contract or otherwise pursuing an incorrect procedure; (3) require the contracting authority to rectify an incorrect procedure; or (4) order the contracting authority to pay compensation to a party who would have had a genuine chance of winning the contract if the procedure had been correct. The Committee requests the Government to provide information of the changes to the Act on Public Contracts as part of the legislative reforms.

Article 4(b)(ii). System of inspection and application of the Convention in practice. Further to a general overview of inspections carried out between 2011 and 2015, the Government states that the Occupational Safety and Health Administration’s Vera information system, introduced in 2016, is able to generate specific information on inspections on public administration. The Committee requests the Government to continue to provide information on inspections focused on public administration, indicating the number of inspections, the number and type of infringements detected, and sanctions imposed. Furthermore, it requests the Government to provide up-to-date information on the manner in which the Convention is applied in practice, including, for instance, statistics on the average number of public contracts granted annually and the approximate number of workers engaged in their execution, as well as information on any practical difficulties in the application of the Convention.