Competence

Already from the start the competence of the Labour Court was enacted to be relatively narrow covering only legal disputes resulting from collective agreements. Under the existing law the Labour Court hears and tries the legal disputes arising out of collective agreements or collective civil servants' agreements or out of the Collective Agreements Act or the Act on Collective Civil-Servant Agreements. A prerequisite for a matter to fall within the competence of the Labour Court is that the specific question involves the competence, validity, contents or extent of a collective agreement or the correct interpretation of a clause in such an agreement. In addition, cases in which it is questioned whether a course of action is in accordance with the collective agreements or Acts mentioned above fall within the competence of the Labour Court. The Labour Court also imposes the sanctions for a breach of these agreements and Acts. The possible sanction to be imposed by the Labour Court is a compensatory fine. In cases where the parties to the collective agreement have agreed on damages for a breach of the agreement the Labour Court can enter a judgment ordering such damages. The Labour Court is not empowered to impose a disciplinary sanction or a criminal sentence.

The amounts of compensatory fines are defined in the Collective Agreements Act and in different acts concerning the civil servants' collective agreements. The amounts of compensatory fines are reviewed every three years to be adjusted for changes in the value of money. According to the Collective Agreements Act’s provisions that entered into force 18 May 2024, the amount of the compensatory fine imposed for a breach of the obligation to maintain industrial peace, or for failure to comply with the related supervisory duty, is a minimum of EUR 10,000 and a maximum of EUR 150,000. As of 1 January 2024, the compensatory fine imposed for a wilful breach of the provisions of a collective agreement, or for failure to comply with the related supervisory duty, is a maximum of EUR 37,400, and in the case of an individual employee a maximum of EUR 370. For special reasons, the compensatory fine may be adjusted or waived in its entirety. The compensatory fine is payable to the employers' or employees' organization winning the specific case.

Any court of law may request the Labour Court for an opinion in a matter which requires special knowledge in the field of employees' or civil servants' collective agreements. The court of law having requested the opinion is not, however, bound by it.

Collective agreements are accredited the status of general applicability by a special board. The boards’ decision can be challenged in the Labour Court which makes the final decision.

The Labour Court is not empowered to rule upon disputes arising out of individual employment contracts concluded between an employer and an individual employee or out of the legislation regarding employment relationships.

The territorial competence of the Labour Court covers the whole country. The decision of the Labour Court is final, and there is no ordinary appeal against its decisions to a higher instance. However, the so-called extraordinary means of appeal are available. In this procedure, judgments of the Labour Court may be annulled by the Supreme Court upon demand. Thus far such appeals have not been successful.