As of 1 January 2026, a proper reason will be sufficient for terminating an employment relationship on grounds related to the employee’s person. According to the Ministry of Economic Affairs and Employment’s press release from December 2025, Minister of Employment Matias Marttinen stated that “our aim is to remove barriers to employment and encourage recruitment. This is an important change for small businesses, which find the legal risks associated with dismissals to be significant barriers to hiring staff. We want to remove barriers to employment for companies so that as many people as possible can find work.”
Previously the legislation required proper and weighty reason for terminating an employment relationship. Therefore, the dismissal threshold has been lowered and terminating an employee’s employment should be, at least to some extent, less troublesome. However, it may take a few years to fully understand the effect of the legislative amendment in legal praxis.
A breach or neglect of obligations related to the employment relationship can be considered as proper reason for terminating an employment relationship. According to the Ministry of Economic Affairs and Employment, the following may be considered negligence (not an exhaustive list): not following the employer’s orders, neglecting work, unjustified absence, inappropriate behaviour, or negligence at work.
It should be noted, however, that the fulfilment of the grounds for terminating an employment relationship on grounds related to the employee’s person should be still be assessed through an overall assessment and many of the previous rules still apply: no arbitrary or discriminatory reasons can be used to terminate an employment relationship and a warning (and an opportunity to correct one’s conduct) must be given before terminating an employment relationship on grounds related employee’s person.
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