European Restructuring Monitor (ERM)
Eurofound's ERM database on restructuring-related legal regulations provides information on regulations in the Member States of the European Union and Norway which are explicitly or implicitly linked to anticipating and managing change.
Whole regulation
In case of employer insolvency, wages and other claims of employees resulting from the employment contract are secured by the national pay security system, which is financed by the employer’s contribution to unemployment insurance. Pay security includes wages, holiday compensation and daily allowances.
An employer is considered insolvent if the employer is unreachable or has terminated the business activity and it can be proven that the amount in question cannot be paid from the assets, or if the employer has been declared bankrupt or else been established to be unable to pay its debts. Insolvency can also be based on if the employer has failed to pay the required employer contributions or the statutory pay-as-you-earn taxes on time.
The guarantee covers all claims that have been applied for as wage guarantee within three months of the pay or other claims falling due, irrespective of the duration of the employment or the type of contract. Exceptions to this time limit are applied in cases where the employer is either convicted of serious work-related exploitation and in cases where there are reasonable grounds to believe that such exploitation has occurred. In the first mentioned a claim can be made up to three months after the criminal judgment becomes final, and in the later up to 18 months after employment termination.
The maximum amount to be paid per employee and employment contract with the same employer is €19,000. The employee can submit the application themselves or it can be done by a trade union on behalf of the employee.
Since 2016, the pay security system of the entire country is administered by the Uusimaa Centre for Economic Development, Transport and the Environment (ELY centre) in Helsinki. The centre makes decisions in pay security matters and handles other functions connected with enforcement of the Act. On 1 January 2025 administrative responsibility is however transferred to the Development and Administrative Centre (KEHA centre). Applications for claiming pay security must be submitted to the KEHA centre or to the municipal or joint municipal authority responsible for organising public employment services.
According to statistics by the Ministry of Economic Affairs and Employment, the total amount paid through the pay security system was €25.9 million in 2022.
Statistics by the ministry and the ELY centres show earlier total payments of pay security:
The number of pay security beneficiaries was 5,015 in 2022. A few years earlier, in 2017 they were 5,800 and 5,200 the year before that.
Eurofound (2015), Finland: Wage guarantee in case of insolvency, Restructuring legislation database, Dublin, https://apps.eurofound.europa.eu/legislationdb/wage-guarantee-in-case-of-insolvency/finland
Between the end of 2022 and the first half of 2023, almost 300,000 employees working for ‘big tech’ companies were laid off across the world, making headlines for months in global media. This development has been a shock, considering the high numbers of jobs in well-known tech corporations with a reputation for offering good working conditions and well-paid positions.
The retail banking sector is fertile ground for studying the impacts of digitalisation on work and employment. Financial services are increasingly provided online, without the intermediary of customer-facing institutions. Many banks in the sector have been undergoing serial restructuring since the global financial crisis, and it is one of the few service sectors with stagnant or declining employment.
Since 2011, the Restructuring support instruments database of the EU PolicyWatch has been collecting information on measures that assist companies and workers to anticipate and manage restructuring. This article looks at measures in the database aimed at supporting employees and employers during the COVID-19 pandemic (2020–2022).
Eurofound’s European Restructuring Monitor database reveals the impact of the energy crisis on employment in the EU. Following Russia’s invasion of Ukraine in February 2022, energy prices have hit record highs. The European Commission imposed sanctions and limitations on the import of oil and gas from Russia, which has reacted by reneging on supply commitments to many Member States.
