Change Negotiations
Situations that require change negotiations are:
1) Reduction of workforce
· Termination, lay-off, shifting to part-time work and one-sided change of an essential term of employment contract on financial or production-related grounds
2) Essential changes to the position of employees due to changes in company operations
· Essential changes in work tasks,
· work methods,
· organization of work,
· organization of work space or organization of regular working time, which are due to:
o the termination of a company or organization or any part thereof,
o transfer to another location or the expansion or reduction of their operations;
o machine or equipment acquisitions or the introduction of new technology;
o changes in the organization or arrangement of work
o changes in service production or product range
o the introduction of external labor or changes therein
o other changes comparable to those mentioned above
If the changes planned by the employer are estimated to cause termination of an employment contract/employment contracts, lay-off or shifting to part-time work of an employee or employees, reduction negotiations according to Section 3, 16 §, subsection 1 of the Co-operation Act must be undertaken [Co-operation Negotiation Obligation in in Reducing Workforce].
The employer must undertake change negotiations before it makes decisions on the aforementioned matters. The negotiation obligation does not restrict the employer´s right to make decisions on the matters in question but before the making of the decision, the matters must be negotiated with employees.
Change negotiations are conducted between the employer and the representative of its personnel, who represents the employees subject to the negotiations. If the employees do not have a representative, the change negotiations are conducted together with the employees subject to the negotiations. If the planned change only affects the employment of a single employee or a few employees, the negotiations are undertaken with each employee personally, unless otherwise agreed. However, the employee has the right to insist that a matter that concerns them is also negotiated with their representative. The employer must provide a written proposal for negotiations in the event of changes in business operations as early as possible before the start of change negotiations. If the change negotiations concern the dismissal, layoff, part-time employment, or unilateral change of an essential term of the employment contract of one or more employees, the negotiation proposal must be provided at least five days before the start of negotiations.
The proposal for negotiations must provide the employees or their representative with the necessary information to conduct the negotiation. The employer must also inform the starting date and place of the negotiations.
The grounds, effects and alternatives of the planned change to business operations must be discussed in the negotiations.
If the subject of the change negotiations is something other then reduction of workforce, there is not any set deadlines for undertaking negotiations. The employer has fulfilled its negotiation obligation when a matter has been dealt with in the way described above and matters have been handled in the spirit of co-operation, striving to reach a consensus. However, there is no need to reach any kind of agreement with the employees, and after the negotiations, the employer will unilaterally make the decisions concerning impacts on personnel.
Upon request, the employer must take care that minutes are kept on the negotiations. It is endorsed that minutes are kept even without a specific request. All representatives of the employer and the employees that attended shall inspect and sign the minutes, unless otherwise agreed.
After the negotiations, the employer must inform the employee representatives and employees it concerns of the decision it has made.
An employer who regularly employs between 20 and 49 employees must engage in change negotiations when the employer is considering, within a period of 90 days, the dismissal, reduction to part-time employment or unilateral modification of an essential term in the employment contract on financial or production-related grounds or layoffs, regarding at least 20 employees. The provisions of Chapter 3 of the Co-operation Act shall apply to these change negotiations.
The obligation to enter into change negotiations does not apply to an employer who has been declared bankrupt or is in liquidation, or to the parties to the decedent’s estate of a natural person who are considering terminating a contract of employment as provided in Chapter 7, Section 8, Paragraph 2 of the Employment Contracts Act.