Changes to the Co-operation Act from the beginning of July
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There will be significant changes to the Co-operation Act from 1.7.2025. You can read a summary of them in this article.
The purpose of the Act is to promote interaction and trust between employers and employees and to ensure that employees have a say in decision-making at the workplace. The Act provides, among other things, for an obligation to engage in dialogue and a procedure for change negotiations.
The obligation of dialogue refers to the handling of matters that promotes adequate and timely communication between the employer and the employees and the influence of the employees on matters concerning their work, working conditions or status.
Change negotiations must take place when the employer is considering, for economic or production reasons, the dismissal, lay-off, part-time working or unilateral modification of an essential term of an employment contract of one or more employees.
Significant changes to the law
The Co-operation Act will be amended from the beginning of July 2025.
The scope of application will change from 20 employees to 50 employees
The Co-operation Act must be complied with “in full” if the employer regularly employs at least 50 employees.
However, employers with 20 – 49 employees must still engage in change negotiations in a situation where the employer is considering, within a period of 90 days, the dismissal, reduction of working hours, layoff or unilateral change of the terms of employment of at least 20 employees on economic or production-related grounds. In the case of layoffs lasting no more than 90 days, which are based on a temporary reduction in work, these small companies are not required to engage in change negotiations, even if they are considering laying off at least 20 employees.
In addition, these so-called small companies are still required to engage in dialogue, but in a less stringent form. In practice, this means that employers must establish workplace-specific practices for regular dialogue with their staff.
Minimum duration of change negotiations halved
The minimum negotiation periods will be shortened so that the six-week negotiation period will be three weeks and the 14-day negotiation period will be seven days.
However, collective agreements may contain provisions that affect the minimum duration of negotiations.
The shortening of the negotiation periods will not affect the matters to be dealt with in the negotiations. Negotiations will continue to cover, among other things, the grounds for the planned measures, their effects and alternatives.
New 30-day “waiting period” for large-scale layoffs
If an employer plans to terminate the employment of at least 10 employees on production-related or economic grounds, the employment contracts may not be terminated until 30 days have elapsed from the date on which the consultation proposal was submitted to the employment authority. This is intended to ensure that there is sufficient time to arrange employment services to support the employees who are being made redundant.
Change negotiations and the threat of redundancy – what to do?