Insights | May 27, 2020

Roschier acts in successful employment dispute

A Roschier client was involved in an employment dispute in the Finnish Supreme Court relating to complex issues concerning the transfer of a business. Two employees had brought employment-related claims against our client amounting to over EUR 500,000. The claims were denied when the Supreme Court ruled in our client's favor.

In its recent judgment (KKO 2020:35, issued on 15 May 2020), the Supreme Court overruled the previous decisions made by the District Court and the Court of Appeal and ruled in favor of our client, confirming that the two employees had not, in fact, entered into an employment relationship with the transferee in the transfer of a business between a public sector transferor and the transferee, which operates in the private sector in the field of Higher Education. The judgment was in line with the Supreme Court’s opinions expressed in previous rulings (KKO 2008:88 and KKO 2018:64-66).

In addition, the ruling in KKO 2020:35 covered the applicability of the protection of municipal civil servants employed in the public sector guaranteed by Council Directive 77/187. According to the Supreme Court, the so-called principle of continuity applied within the public sector is not applicable when the transferee acts in a private sector and the status of a civil servant does not automatically entitle the person to transfer. If the transferee does not employ the person in this type of transaction, an employment relationship does not arise.