A new state-owned company to employ the most disadvantaged people with partial work ability

A state-owned special assignment company named Työkanava Ltd will be established in Finland. Its task is to promote the employment of people with partial work ability who are in the most difficult labour market position. The company would support their skills so that the people could find employment in the open labour market after working at Työkanava.

The establishment of the company is based on the aim of the Government of Prime Minister Sanna Marin to promote the employment of people with partial work ability and develop the intermediate job market in a new way.

The proposal on this matter was submitted to Parliament on 21 October. The company is set to launch operations in 2022. Where applicable, the company has been modelled after Sweden’s Samhall, which has operated for a long time.

“The right and opportunity to work according to their abilities is important not only for the people with partial work ability and but for the Finnish society as a whole. From this group of people, Työkanava Ltd will be able to employ the most disadvantaged people, whose employment prospects have so far not markedly improved despite different measures and services. The launch of the company is also proof that Finland is implementing its international obligations to the UN in accordance with the Convention on the Rights of Persons with Disabilities,” says Minister of Employment Tuula Haatainen.

Ownership steering for Työkanava Ltd is the responsibility of the Ministry of Economic Affairs and Employment. 

Activities to start in stages

The aim is for Työkanava Ltd to operate throughout the country, but the operations would start gradually. Työkanava could make use of existing services and work together with other intermediate labour market operators.

Työkanava would be financed with an initial capital of EUR 20 million allocated to it in the Budget from the Sustainable Growth Programme for Finland (EU Recovery and Resilience Facility RRF). In addition, the company would be provided with an annual appropriation of EUR 10 million, with the aim of employing 1,000 persons in the long term. The company would also generate income from selling its services. 

Employees to receive a job contract with Työkanava with the TE Office acting as public authority

Employment with Työkanava Ltd would be the option of last resort when all other opportunities for finding employment have been exhausted. At present, the TE Offices have registered more than 30,000 unemployed jobseekers who have been diagnosed as having reduced capacity to work. Of them, the most disadvantaged are people who have an illness or disability and who are aged over 55 and have a low level of education.

Employees would be hired directly by Työkanava under an employment contract. Their remuneration and other terms of employment would be determined under employment legislation and the applicable collective agreement.

The company would have no public administration functions and it would not exercise public authority. The only avenue available to Työkanava in selecting employees would be the TE Office, which acts as a public authority. TE Office would direct people with partial work ability to employment with Työkanava Ltd in a centralised manner and based on the company’s needs.

“Employers’ attitudes towards the employment of people with disabilities and long-term illnesses are increasingly more positive, and I am very pleased about it. People with partial work ability have a wide range of skills and their educational background is broad and diverse. We hope that Työkanava will further lower the threshold for employing people with partial work capacity,” Minister Haatainen says.

Company’s services will be priced on market terms

The economic activities of Työkanava would be subject to the Competition Act, which lays down provisions on safeguarding equal operating conditions, i.e. ensuring competitive neutrality between public and private sector business activities. 

The company would operate in such a way that it does not distort competition relative to the service offering of entities active in the open market, such as companies and organisations. In practice, this means that the services provided by the company must be priced on market terms. Työkanava’s pricing and market share would be monitored by a separate advisory board, the Finnish Competition and Consumer Authority and the Ministry of Economic Affairs and Employment as part of its ownership steering.  

Työkanava is part of the Government’s employment measures

The Government aims to reach an employment rate of 75% by the mid-2020s. This will require increased employment also among people with partial work ability. To achieve this goal and as part of the Government’s employment measures, a work ability programme is currently under way. It promotes the employment of people with partial work capacity and their wellbeing at work. Työkanava Ltd is one of the programme’s practical measures. 

The Ministry of Economic Affairs and Employment is also implementing a number of other measures to improve the employment of persons with partial work ability as part of the work ability programme. For example, TE Offices will recruit more work ability coordinators, and TE service pilots will improve the relevance of TE services to persons with partial work ability. In addition, the employment of people with partial work ability is also taken into consideration in the programme to accelerate employment through procurement and in the activities of the newly established centre of expertise for social enterprises.

Besides the work ability programme, there are several major reforms underway to help unemployed people who are disadvantaged in the job market. Such reforms include the TE services reform where the responsibility for organising TE services will be transferred to municipalities in 2024, the introduction of the Nordic labour market service model, and the reform of the pay subsidy scheme. 

Inquiries and more information:
Iiris Niinikoski, Special Adviser to the Minister of Employment, tel. +358 295 047 372 
Kimmo Ruth, Labour Market Counsellor, Ministry of Economic Affairs and Employment, tel. +358 295 048 073
Patrik Tötterman, Senior Specialist, Ministry of Economic Affairs and Employment, tel. +358 295 049 034, [email protected]