Major changes in technology, economic contexts, workforces and the institutions of work have ebbed and flowed since well before the first Industrial Revolution in the 18th century. However, many argue that the changes we are currently facing are different, and that the rise of digitalised production will entirely transform our ways and views of working. In this collaborative project, funded by the Nordic Council of Ministers, researchers from the five Nordic countries have studied how the ongoing transformations of production and labour markets associated with digitalisation, demographic change and new forms of employment will influence the future of work in the Nordic countries.
Through action- and policy-oriented studies and dialogue with stakeholders, the objective has been to enhance research-based knowledge dissemination and experience exchange and mutual learning across the Nordic borders. Results from the project have informed, and will hopefully continue to inform, Nordic debates on how to contribute to the Future of Work Agenda that was adopted at the ILO’s centenary anniversary in 2019.
The project has been conducted by a team of more than 30 Nordic scholars from universities and research institutes in Denmark, Finland, Iceland, Norway and Sweden. The project started in late 2017 and will be completed with a synthetising report in 2021.
To address the main aspects of change in working life, the project has been organised into seven pillars with pan-Nordic research teams:
For Fafo, which has coordinated the project, the work has been both challenging and rewarding. In the final phase of the project, all the Nordic economies were hit hard by the measures taken to slow the spread of Covid-19. This effectively illustrates how predicting the future of work is a difficult exercise.
We are very grateful for all the work done by the team of scholars, and we would also like to thank our contact persons in the Nordic Council of Ministries, namely Tryggvi Haraldsson, Jens Oldgard and Cecilie Bekker Zober, for their enthusiastic support. Many thanks also to all the members of the NCM committees that have contributed to this work through workshops and commenting on different drafts, and to the numerous interviewees in Nordic working life organisations and companies who shared their time and insights with us.
Kristin Alsos, Jon Erik Dølvik and Kristin Jesnes,
This report forms part of the large collaborative research project “Future of Work: Opportunities and Challenges for the Nordic Models” (2018–2021) which has been funded by the Nordic Council of Ministers and organised by Fafo, Oslo. The project involves more than 30 researchers from all five Nordic countries and seven subprojects.
This report, “Non-standard work in the Nordics: troubled waters under the still surface”, presents the result of Project Pillar III on non-standard work. Pillar III has focused on both traditional forms of non-standard work (NSW) such as temporary contracts (covering both fixed-term contracts and temporary agency work), part-time, solo self-employed as well as emerging employment practices such as zero-hour contracts and freelancer companies. It involved national research teams from all five Nordic countries (Denmark, Sweden, Norway, Finland and Iceland). In total, 18 researchers have contributed to the empirical studies and this final report. The Danish team included Anna Ilsøe, Trine P. Larsen and Emma S. Bach (FAOS, University of Copenhagen), Stine Rasmussen and Per Kongshøj Madsen (CARMA, University of Aalborg). The Swedish team included Tomas Berglund, Anna Hedenus, Kristina Håkansson and Tommy Isidorsson (University of Gothenburg). The Finnish team consisted of Jouko Nätti, Satu Ojala, Tiina Saari, Paul Jonker-Hoffrén, Pasi Pyöriä (Tampere University). Kristine Nergaard (Fafo) participated with the Norwegian part of the study, whereas Katrin Olafsdottir (Reykjavik University), Kolbeinn Stefansson (University of Iceland) and Arney Einarsdottir (Bifrost University) formed the Icelandic team.
We would like to thank the Nordic Council of Ministers for financing the project and for helping us finalise this report. Thanks also to Jon Erik Dølvik and Kristin Alsos at Fafo for initiating and organising the project as well as quality assurance. The empirical part of this project has involved more than 60 interviews with social partners, governmental actors, managers, workers etc. Thank you so much for sharing your valuable time with us and allow us to gain insights into the drivers and effects of NSW practices.
Anna Ilsøe and Trine P. Larsen
The Nordic models of labour market regulation and the Nordic welfare states have been built and shaped around the notion of the standard employment relationship, i.e. full-time, open-ended jobs. However, the development of non-standard work (NSW) and emerging practices of new contractual employment forms may challenge these institutions. In the media and academic research, a growing debate has emerged on whether we will all be freelancers or precarious workers in the future labour market – also in the Nordic countries.
In this TemaNord report, we investigate the development of NSW within the context of the Nordic welfare and industrial relations models. We draw on Labour Force Survey (LFS) data from the Nordic Statistical Offices to map the development in traditional, well-known forms of NSW such as fixed-term contracts, temporary agency work, part-time work and solo self-employment. To address emerging employment practices, we conduct in-depth case studies, involving interviews with management and workers in selected and relevant sectors such as hotels and restaurants, freelancer companies and care for the elderly. Finally, we use desk research and elite interviews with representatives from trade unions, employers’ associations and public authorities to uncover policy debates and responses to recent developments in NSW and explore how the Nordic countries have responded to the corona outbreak from the perspective of non-standard workers.
The general statistics demonstrate a fairly stable development in NSW across the Nordics over the last two decades. However, country and sector specific statistics as well as case studies display significant variations and changes beneath the still surface. These differences seem to be highly sector and company specific, but we do not know the exact extent of all of them, as novel practices of NSW are not well-covered by existing surveys and registers. We find interesting examples of policy responses to some of these developments, whereas others are yet to be addressed, not least as the recent corona crisis has revealed some gaps in the Nordic models with regards to non-standard workers’ social- and employment protection. The report concludes with a discussion of what lessons can be learned regarding the development of NSW and the policy measures applied to mitigate undesirable effects not only across the Nordics, but also across sectors and companies.
The report is structured in four parts. The first part, the “Introduction”, consists of two comparative chapters, involving all five Nordic countries (Chapters 1–2). In the second part, “Traditional forms of non-standard work: mapping country developments via Labour Force Survey data”, the recent development in established forms of NSW are analysed for each of the five Nordic countries (Chapters 3–7). The third part of the report, “Emerging trends in non-standard work: case studies in selected sectors”, presents our in-depth case studies of emerging employment practices (Chapters 8–11). The fourth part of the report, “Discussion and conclusion”, discusses the impact of the corona crisis on non-standard workers in the Nordics and the various policy responses of Nordic governments (Chapter 12) and presents the final conclusion and discussion of our findings (Chapter 13). Summaries of single chapters are listed below.
Chapter 1 presents a comparative analysis of the development in traditional forms of NSW in Sweden, Denmark, Norway, Finland and Iceland, using LFS data from the national statistical offices. We focus on four well-known and significant forms of non-standard work: fixed-term contracts, temporary agency work (TAW), long part-time work (15–29 weekly working hours) / marginal part-time work (less than 15 hours per week) and solo self-employment (i.e. people not enrolled in a subordinate employer-employee relationship and without employees, such as freelancers). Around one-third of all people employed in the Nordics can be characterised as non-standard workers, and this figure has remained fairly stable since 2000. However, the forms and scope of NSW vary over time and across countries and sectors. Temporary work (covering fixed-term contracts and TAW) is especially used in Sweden and Finland, whereas solo self-employment is most prevalent in Iceland and Finland. Marginal part-time work is more frequently used in Denmark and Norway, whereas long part-time work has the highest share in Norway and Iceland. Worker characteristics vary across the different forms of non-standard work. Older workers, young people (students in particular), women, and foreign-born persons are more likely to take up part-time and temporary employment, whilst more men, often older workers, pursue a career as solo self-employed in all five Nordic countries. Involuntary NSW has increased in the Nordic countries during the last few decades and is particularly prominent in Sweden, Finland and Norway. Solo self-employment, along with long- and marginal part-time work, are often a voluntary choice for many, while this is less often the case for temporary jobs. Finally, we discuss the methodological challenges in mapping and comparing non-standard work, which can be defined and measured differently across countries. When it comes to categories of NSW such as on-call work, zero-hour contracts and platform work that have emerged or increased in recent years, there are also important differences in definitions. Furthermore, we lack solid and comparable data on these employment practices, which are not mapped consistently and continuously in existing surveys and registers.
Chapter 2 addresses the regulation of NSW in the Nordic countries in the form of labour law, collective agreements and welfare arrangements. We ask the question whether regulations reproduce, reinforce or counteract differences between standard and non-standard work, and highlight relevant policy responses. Firstly, we analyse the risks of in-work poverty, income insecurity in the form of underemployment and job insecurity among non-standard workers, along with the potential opportunities that also may be associated with NSW. Temporary workers are particularly exposed to increased risks of in-work poverty in all five Nordic countries, notably in Norway and Sweden, where almost one in five temporary workers report this. Income insecurity (or underemployment) is highest among marginal part-time workers, especially in Finland and Sweden, where this is the case for one in three of all marginal part-time workers. Job insecurity is highest among temporary workers (fixed-term contracts and TAW) with one in five temporary workers reporting job insecurity in Finland and Sweden. NSW may also in some instances be a stepping stone into the labour market for some groups or a way to retain people in paid work that may otherwise struggle to commit to a full-time job. Secondly, we present an overview of the regulation of NSW in the Nordics. All five Nordic countries have regulations that aim to protect non-standard workers. However, we also find gaps in the regulation when it comes to protection of non-standard workers. Restricted access to unemployment benefits, occupational pensions and insurance as well as underemployment are some of the issues raised in recent debates. Other debates have been closely tied to discussions of social dumping and unfair competition, especially concerning migrant workers within low wage sectors. While the recently adopted EU Directive on Transparent and Predictable Working Conditions may strengthen protection of Nordic non-standard workers – as have former directives regarding equal treatment of temporary and part-time workers – the Commission proposal for introducing a European minimum wage system has been highly contested among the social partners in all five Nordic countries.
Traditional forms of non-standard work in the Nordics
Chapters 3–7 map and analyse developments in NSW in Sweden, Denmark, Norway, Finland and Iceland, using LFS data from the national statistical offices. Across the Nordic countries, the share of non-standard workers has remained fairly stable since 2000. However, marked cross-country and sector variations can be observed, and we analyse these variations in detail in these country chapters.
In Sweden (Chapter 3), temporary employment is the main – and in recent years increasing – form of non-standard work. Temporary jobs make up 15 per cent of all employment, while the total NSW amounts to 26 per cent. Moreover, temporary employment is increasingly involuntary for workers. Today, 70 per cent of workers with temporary contracts would prefer otherwise in Sweden. This has been associated with a relaxing of the rules regarding temporary contracts in the Swedish labour market, which has allowed Swedish employers to utilise these contracts considerably. Temporary employment is particularly widespread in sectors such as hotels and restaurants (33 per cent), arts and entertainment (30 per cent) and administration and support services (28 per cent). Students, multiple jobholders and people born outside the Nordic countries are overrepresented among temporary workers.
In Denmark (Chapter 4), part-time employment is widespread within the private and public service sectors. Since 2000, the share of long and especially marginal part-time employment has increased. Today, marginal part-time employment is the most common form of NSW in Denmark and accounts for 11 per cent of all employment. The total of NSW is 29 per cent of all employed people. Marginal part-time work is widespread within the hotels and restaurants (32 per cent), arts and entertainment (30 per cent) and retail (24 per cent) sectors. Marginal part-time work is often voluntary – only 5 per cent would prefer full time work. Many marginal part-time workers are students and/or migrants, with 72 per cent reporting school and training activities as their main reason for working marginal part-time jobs.
In Norway (Chapter 5), part-time workers make up the largest group of non-standard workers. Since 2000, long part-time work has decreased while marginal part-time work has increased. However, long part-time work still makes up the largest share of non-standard workers (12 per cent). NSW amounts to 29 per cent of all those employed in Norway. The share of long part-time work is largest in health and social services (23 per cent), hotels and restaurants (20 per cent) and arts and entertainment (16 per cent). Women, young people, older people and multiple jobholders are overrepresented among long part-time workers. Involuntary part-time work (i.e. the number of part-time employees who want longer hours) has decreased during the last two decades and stands at 16 per cent for both marginal and long part-time workers. This might relate to recent legislative measures to fight involuntary part-time work. Nevertheless, being female still increases the risk for involuntary part-time work.
In Finland (Chapter 6), temporary workers (13 per cent) form the largest group within non-standard work, although the number has decreased slightly since 2000. Temporary employment is especially found in sectors such as education (26 per cent) and health (21 per cent). Solo self-employed workers form the second largest group of non-standard workers (10 per cent), which is a relatively high share compared to the other Nordic countries. In total, 31 per cent of all employed people are in a NSW arrangement. In Finland, women, young workers and foreign-born people are overrepresented in non-standard work, but also retirees are likely to undertake TAW or fixed-term work. In addition, temporary positions (including TAW) are often involuntary (two in three would prefer a permanent position). In recent years, solo self-employment and the labour market status and reasons for this type of work have been up for debate.
In Iceland (Chapter 7), long part-time (11 per cent) and temporary work (11 per cent) are the two most dominant forms of non-standard work, whereas solo self-employment comes in third (8 per cent). In total, 31 per cent of all employed people report their employment form as non-standard work. Long part-time work is primarily used in retail, the public sector and within other services, whereas temporary employment is widespread in agriculture, public sector and other services. Solo self-employment is found in agriculture and construction, among others. Employees in NSW are often either young students or older people, close to or at retirement age. Moreover, an increase in foreign workers has led politicians to enact laws that secure their rights, plus an Act on Workplace IDs for sectors with high shares of foreign workers.
Emerging trends in non-standard work: case studies in selected sectors and policy responses
Chapter 8, 9 and 10 present in-depth case studies of emerging practices of NSW in three sectors which are particularly relevant: hotels and restaurants, freelancer companies and care for the elderly. Each study compares two case companies from the same sector, but across two Nordic countries. The analysis is based on interviews with local management, workers and social partners.
Chapter 8 compares two case companies in the hotel and restaurant sector in Denmark and Finland, a sector with highly unpredictable service demands and thus a great need for flexibility. Only one in two workers hold full-time permanent positions within the sector, which is also the case in the companies analysed. The case companies use zero-hour contracts as well as subcontracted work, part-time work and TAW to secure the flexibility needed. In both cases, however, a number of workers without guaranteed working hours are at risk of underemployment, i.e. an insufficient number of hours to make a living, and of falling into gaps in the social protection system. Furthermore, the chapter addresses methodological challenges, when studying contracts without guaranteed working hours. In both Denmark and Finland, social partners have negotiated innovative policy responses to challenges regarding zero-hour contracts. In Denmark, they have agreed upon a higher hourly wage for workers on zero-hour contracts to compensate for their lower levels of social- and employment protection, including lack of guaranteed hours. In addition, we find an innovative chambermaid protocol, which offers employers flexible working time arrangements in return for guaranteeing that minimum 45 per cent of the chambermaids hold full-time positions. In Finland, skiing hotels have negotiated a similar trade-off with the unions by reserving flexible working hours for full-time staff, which encourages employers to hire more full-time employees.
Chapter 9 analyses one freelance company in Norway and one in Sweden, respectively. A freelance company is an organisation which hires freelancers as employees, but at the same time allows them to find their own clients and tasks. The company handles all administrative tasks, such as invoicing and tax/VAT payments. The employed freelancers also get access to social security, i.e. unemployment insurance schemes and sick pay. The Norwegian freelance company hires on open-ended contracts, which is suitable for full-time freelancers with a relatively stable income, who want some of the social security aspects of being an employee. The Swedish freelance company hires on fixed-term contracts and is more similar to a start-up hub, where freelancers on average only stay two years to get a foothold in the labour market as solo entrepreneurs or learn the basics of being self-employed. In both case companies, there is next to no trade union involvement. The Swedish freelance company is member of an interest organisation for freelancer companies in Sweden. In general, solo self-employed and freelancers face increased risks of falling into the social security gaps due to their unclear legal status. In Norway, LO has responded to this by creating ‘LO independent’; a collaboration between trade unions organising self-employed workers under the LO Confederation and offering member services such as legal assistance, courses or discounts on private insurances. In Denmark, the Danish trade union HK has created a similar initiative for freelancers, including a Freelancer Bureau, which employs and assists freelancers with administrative tasks in exchange for a fee. In Iceland, self-employed are obliged to pay to the mandatory pension fund contribution (15.5 per cent of income), that is usually shared by the employer (11.5 per cent) and employee (4 per cent), via the tax system. This initiative ensures that self-employed get similar pensions as employees.
Chapter 10 compares two cases in the Danish and Swedish eldercare sector. In both countries, eldercare is publicly funded and administered by municipalities, although services are increasingly outsourced to private firms. The Swedish case is a private company within eldercare, where workers often are employed on temporary contracts. Within restrained budgets, the main challenge for the employer is to secure staff continuity while at the same time ensuring that flexibility needs are met. This is often resolved by hiring on-call workers and by scheduling with split shifts shared between two or more workers. Similarly in the Danish case, the hiring of part-time and on-call workers is explained by needs for flexibility and cost curbing. Most care workers choose part-time for work-life balance reasons (women are overrepresented in the care sector) and to ease workloads due to the physical and exhausting nature of the work. For the employer, the main challenge with on call work is to secure continuity among staff, whereas many employees struggle to secure a sufficient number of weekly working hours to make a living. To address some of these issues, the social partners in Sweden have signed an interesting agreement on a competence lift, where employees can study to become an assistant nurse while working part-time.
Chapter 11 summaries the comparative case studies of companies as well as policy responses analysed in Chapters 8–10
Conclusion and discussion
Chapter 12 discusses the current employment situation for non-standard workers in the Nordics following the corona pandemic and crisis in Spring and Summer 2020. The corona crisis hit the Nordic economies hard when measured in terms of real GDP growth. The economic slowdown has been accompanied by rising unemployment rates, where some groups of employees, notably in tourism, retail, hotels and restaurants and large part of the performing arts and entertainment industry have been exposed to job loss – that is, sectors where non-standard workers are overrepresented. Nordic governments have launched a series of unprecedented help packages that in many respects cover a much broader group, including non-standard workers, than the kind of measures we saw during the financial crisis of 2008. Although the intentions of the Nordic governments’ help and rescue packages were to unite people by creating a safety net even for those on the outskirt of the labour market, we find that the reforms have in some instances exposed and reinforced the gaps in Nordic employment- and social protection, but more so in some Nordic countries than others. Norway, Finland and Iceland suspended to some degree existing eligibility criteria for unemployment benefits and sick pay and gave all workers, including freelancers and solo self-employed workers, access to income security in case of job loss, temporary dismissals or lost revenue from freelance or self-employed business activities. In Sweden, the national government lowered the criteria for unemployment benefits and sick pay to ease access, while Denmark was the only country where the usual criteria for accruing rights to unemployment benefits and sick pay remained unchanged with regard to past employment records and weekly working hours. Moreover, in Sweden and Denmark, temporary workers, freelancers and solo self-employed people were unable to qualify for wage compensation, temporary lay-off or short-term work schemes, which stood in contrast to Iceland. In Norway and Finland, temporary workers could, unlike freelancers and self-employed people, qualify for temporary lay-off or short-time work schemes. However, Danish, Swedish, and Norwegian freelancers and solo self-employed people could, similarly to their Icelandic and Finnish counterparts, seek other targeted support schemes to cover their lost income. Therefore, some groups of non-standard workers apparently found it more difficult to use the help and support schemes than standard workers. Thereby, it appears that the corona crisis has not only tested the safety net around non-standard workers, but also pointed to long-existing gaps in the systems, leading to innovative ad hoc policy responses in all the Nordic countries to protect non-standard workers against the losses imposed by the national governments’ lockdowns and restrictions of their business opportunities.
Chapter 13 concludes the report by summarising the findings and discussing further perspectives for policy and research. We highlight six main concluding points: 1. The overall share of NSW in the Nordics has remained relatively stable since 2000, ranging from one in four of all employed in Sweden to nearly one in three in Denmark, Norway, Finland and Iceland. 2. Each Nordic country presents a different blend of non-standard work, which to some extent also differ between sectors and companies. 3. Moving to the sector level, we find troubled waters under the still surface. The most salient changes in NSW in the Nordics seem to be concentrated within certain sectors. 4. Emerging practices of non-standard work: new challenges and possibilities. Moving to the company level, variations seem to increase and new (and often more casual) practices emerge below the surface. 5. Muddy waters and lack of data: methodological challenges when studying non-standard work. The emerging practices at company level indicate that we may be looking through muddy waters when we try to measure non-standard work, and we miss important developments – especially changes within non-standard work. In sum, our report calls for methodological development and more fine-grained data with regards to the study of NSW in the Nordics to support policymakers with updated data about ongoing change. Despite the fact that the total volume of NSW remains fairly stable, we find signs of casualisation within NSW that needs to be characterised and documented in detail. This casualisation process might involve a clustering of risks for workers and highlights the importance of adequate social security protection for non-standard workers provided either via the Nordic models of labour market regulation or/and the welfare states. 6. Regulation of NSW in light of the corona crisis: reducing or fighting insecurities. The shock effects of the corona crisis on the Nordic labour markets were a lesson to many non-standard workers as they were some of the first to lose their job or stop receiving new contracts or work assignments. The Nordic governments launched unprecedented broad help packages with the aim to cover both standard and non-standard workers, apparently with more success in some countries than others. This relates to the data problem mentioned above, but it is also closely tied to the income patterns of many non-standard workers. Many combine various forms of NSW to avoid underemployment, making it difficult to categorise, measure and target them. Regarding the future of work in the Nordic labour markets, we find different examples of how social partners address the challenges and adjust the regulation to enhance security for non-standard workers. In some instances, social partners have negotiated innovative policies into existing collective agreements, whereas in other instances politicians have introduced obligatory measures by law. However, it seems more difficult to target non-standard workers than standard workers via existing collective agreements, as many of them are not covered by a collective agreement and even more not unionised. Extension of collective agreements by law can be an instrument to tackle this challenge. Furthermore, solo self-employed workers and freelancers are difficult to cover by collective agreements due to competition laws. In consequence, some groups of non-standard workers may only be reached by legislative measures. Finally, ongoing negotiations in the EU on labour market directives targeting working conditions for non-standard workers may also feed into the Nordic discussions on non-standard work. Typically, social partners in the Nordics prefer voluntarist solutions along the lines of the Nordic collective bargaining traditions. However, this may encounter greater difficulties regarding NSW and calls for innovative responses in the Nordics.
By: Trine P. Larsen & Anna Ilsøe
Non-standard work (NSW) and the associated risks of precarious employment have been subject to increased attention among policymakers, social partners and academic scholars across the Nordic countries. Numerous questions have been raised, such as will NSW be the future norm in the Nordic labour markets?, To what extent does NSW lead to more freedom and flexibility for workers or deteriorating employment conditions, and if so, for whom? How does NSW influence productivity and economic growth? And how will the sustainability of the Nordic collective bargaining model and welfare state be affected by rising disparities and segmentation between the core and the periphery of labour markets?
In this context, a growing body of literature with focus on labour market inequalities has explored the volume, characteristics and distinct types of NSW, including the regulatory framework, and the wage and working conditions under which non-standard workers are employed (Rubery et al. 2018; Ingelsrud et al. 2019; Håkansson & Isidorsson 2015). Concepts such as working poor, the precariat, bad or poor jobs and precarious employment that originate from Anglo-Saxon literature have increasingly been applied in the Nordic working life literature to capture the fragmented, insecure and unpredictable employment situation of non-standard workers across the Nordic countries (Kalleberg 2011; Rubery et al. 2018; Standing 2011; Larsen 2011). Also concepts like living wage and living hours have been used by Nordic scholars to explore the minimum income or minimum hours necessary for workers to secure a basic, but decent standard of living through employment without government subsidies (Anker 2011; Ilsøe et al. 2017). These studies find that although the Nordic labour markets in general demonstrate high wage levels, generous employment and social protection and high living standards, there are often increased risks of low wages and employment and income insecurities associated with NSW (Rasmussen et al. 2019; Jesnes 2019; Pärnänen 2017; Ilsøe 2016). Ample Nordic research also points to lower levels of health and safety, skill formation, fewer social rights and lack of institutional representation for non-standard workers (Nätti, 1993; Nergaard, 2016; Scheuer, 2017).
However, the findings/results tend to differ depending on the applied definitions and categories of NSW as well as the employee groups under examination as there exists no statistical conceptual framework that defines NSW within Nordic and international statistical standards (Frosch 2017). In this report, NSW is defined as employment other than the traditional full-time open-ended contract, which throughout the 20th century became the “standard” employment relationship and the foundation of most Nordic welfare- and labour market institutions. Therefore, any worker with a contract other than an open-ended full-time contract risks in principle lower levels of protection than their peers in standard employment (Frosch 2017).
The most common and well-described forms of NSW in the Nordic countries are part-time work, fixed-term contracts, solo self-employment and temporary agency work (TAW). However, during the last two decades, there has been a shift towards novel ways of organising work on the Nordic labour markets, where emerging forms of employment under the broad headings of zero-hour contracts, platform work, on-call work, and distinct forms of solo self-employment have become more salient. Many of these employment forms are not yet systematically documented by existing surveys and register data. In fact, various studies point out that existing studies underestimate the share of such groups as they are not well covered by for example the Labour Force Survey (LFS) or Nordic register data (Ilsøe & Larsen 2020a; Frosch 2017). Thereby, a too rough and, possibly, somewhat skewed picture of the changing employment patterns among European workers, especially non-standard workers, emerges from the LFS survey, even if it is the most comprehensive survey on employment forms in the Nordics (Frosch 2017). Thereby, we are not able to disentangle the changes going on in the composition, character and extent of casualisation within the numerically fairly stable non-standard segments of employment.
In this chapter, we focus exclusively on how the traditional forms of NSW such as part-time work, fixed-term contracts, TAW and solo self-employment have evolved within the last 20 years in Denmark, Finland, Iceland, Norway and Sweden. Our comparative analysis draws on the findings from the national country reports prepared by the national teams listed in the prefaceThe national teams are for Denmark (Stine Rasmussen, Trine P. Larsen, Anna Ilsøe, Per Kongshøj Madsen, Emma S. Bach); Finland (Satu Ojala, Tiina Saari, Pasi Pyöriä, Paul Jonker-Hoffrén, Jouko Nätti), Iceland (Katrin Olafsdottir, Kolbeinn Stefansson, Arney Einarsdottir), Norway (Kristine Nergaard), and Sweden (Tomas Berglund, Anna Hedenus, Kristina Håkansson, Tommy Isidorsson).. These national reports draw on data from the Danish, Finnish, Icelandic, Norwegian and Swedish LFS, which is then triangulated with secondary empirical data, policy documents, collective agreements and labour laws. The new, emerging forms of NSW that remain invisible in the LFS and Nordic register data are explored in the chapters 8–10, where company-based case studies have been used to advance our understanding of these forms of NSW.
This chapter is structured into seven sections. First, we briefly examine the recent development of traditional NSW in the five Nordic countries from 2000 to 2020. In the first section, we also examine how the various types of NSW (marginal part-time, long part-time, temporary employment and solo self-employment) vary not only across countries, but also across sectors and over time. We then examine the main characteristics of non-standard workers in the five Nordic countries. Finally, section three briefly discusses the various methodological challenges and alternative ways of analysing NSW, including the emerging forms of organising work, before summarising our main findings.
Non-standard work is defined as employment other than the standard full-time open-ended contract. Full-time work is typically defined around what is considered the “normal” working week in the individual countries, which ranges from 37 hours per week in Denmark to 40 hours per week in Sweden, Finland and Norway, where collective agreements often operate with a lower “normal working week.
Full-time employment: To secure comparability across the Nordic countries, full-time work is considered 30+ weekly working hours, well-knowing that Eurostat and the Nordic statistic offices operate with a broader definition. Using 30 weekly hours as the threshold for defining full-time work also allow us to include for example shift workers, cleaners and care staff on open-ended contracts as their collective agreed full-time working week is typically considered 30-35 hours per week.
Fixed-term contract: A temporary employment contract for a fixed period such as a probation period, project assignments or substitute for employees on leave.
Temporary agency work (TAW): An employment relationship in which the employee works through an agency, but performs work on a temporary basis at a user company and under the supervision and direction of the user company.
NSW covers a broad range of employment forms that have historically co-existed alongside the full-time open-ended contract across the Nordic labour markets. In the last few decades, novel ways of organising work have become more common such as digital platform work, TAW and zero-hour contracts. Some of the more traditional forms of NSW, for instance part-time work, fixed-term contracts and solo -self-employment, have also become more prevalent in the Nordic labour markets, but more so in some countries and sectors than others. NSW accounted for around 32 per cent of all employed in Iceland compared to 31 per cent in Finland, 29 per cent in Denmark and Norway, and 26 per cent in Sweden in 2015 (fig. 1.1). Since 2008, the share of NSW has increased marginally in Finland (from 30 per cent to 31 per cent of all employed) but has slightly declined in Norway and Sweden during the same period. Denmark and Iceland have seen a more marked rise with the share of non-standard workers increasing from 26 per cent of all employed in 2000 to 29 per cent in 2015, while in Iceland 32per cent of all employed worked in NSW in 2015 compared to 28 per cent in 2015 (fig. 1.1).
Note: non-standard work is defined as marginal part-time, long part-time (15–29 hours per week), fixed-term contracts, TAW and solo self-employment.
Part-time work is the most common form of NSW across the Nordic labour markets, ranging in 2019 from 27 per cent of all employed in Norway to 25 per cent in Denmark, 24 per cent in Sweden, 22 per cent in Iceland and 17 per cent in Finland (fig. 1.2). Temporary employment that covers both fixed-term contracts and TAW is also a common form of non-standard work, but more so in Finland and Sweden than Denmark, Iceland and Norway. Around 15 per cent of all employed are temporary workers in Sweden compared to 14 per cent in Finland, 10 per cent in Denmark, 7 per cent in Norway and Iceland, respectively (fig. 1.2). Solo self-employment is the least widespread form of NSW with less than one in ten of all employed being solo self-employed in all five Nordic countries (fig. 1.2).
The share of part-time work, temporary employment and solo self-employment varies not only across countries, but also across sectors and over time – aspects that are explored below.
Part-time work is widely used throughout the Nordic countries, though as mentioned earlier, more so in Norway, Denmark and Sweden, where around one in four work reduced hours (fig. 1.3). Looking across time, there have been slight changes in the share of part-time work in each Nordic country. Since 2000, part-time work has steadily increased in Finland and Denmark until 2010 and decreased in Iceland during the same period. The situation in Norway and Sweden is slightly different, where part-time work increased up until 2004 and 2009 respectively, decreasing thereafter except for a brief hike in Norway in 2018 (fig. 1.3).
The overall changes in part-time work mirror fluctuations in its distinct forms, where we in this study focus on long part-time work (defined as 15-29 weekly working hours) and marginal part-time work (less than 15 weekly working hours). Particularly marginal part-time work is often associated with increased risks of lower levels of social and employment protection (Rasmussen et al. 2019). By looking at these two types of part-time work, we find that there have been different developments in the Nordic countries, where especially Denmark stands out. Since 2000, the share of marginal part-time work has nearly doubled in Denmark, while the increases in the other Nordic countries have been markedly weaker (fig. 1.4). During the same period, the shares of long part-time employment declined in Denmark, Sweden and Norway, while the shares have slightly increased in Iceland and Finland (fig. 1.4).
Note: Marginal part-time is less than 15 hours per week, long part-time work is defined as 15-29 weekly working hours.
These figures suggest that it is mostly marginal part-time work that has increased in all five Nordic countries since 2000, and that this is particularly widespread in the service sectors. In Norway, 28 per cent work less than 15 hours per week in the creative industry, i.e. arts and entertainment, compared to nearly one in three employees in the Danish creative industry, and in the Danish hotel and restaurant sector (fig. 1.5). In Sweden and Finland, contracts of few hours are also frequently used in the creative industry accounting for 15 per cent of all jobs in the sector in Sweden and 17 per cent in Finland. In Iceland, marginal part-time work is mostly used in private services, where 19 per cent hold contracts of few hours followed by financial and insurance activities where NSW accounts for 15 per cent of all jobs in the sector (fig. 1.5).
Note: For Iceland, the Hotel and restaurant sector is a merged category also covering transport, retail and wholesale sector due to low numbers.
Long part-time work is also widespread in the Nordic service sector and often twice as high as the aggregated national figures, which vary from 8 per cent in Sweden to 12 per cent in Norway (fig. 1.4 and 1.6). In Norway, Denmark and Iceland nearly one in five jobs in the hotel and restaurant sector are long part-time, compared to 17 per cent in Finland and 16 per cent in Sweden. Long part-time work is also common in the Nordic creative industry, where the share of long part-time work ranges from 13 per cent in DK to 16 per cent in Sweden and Norway (fig. 1.6).
Note: Iceland’s hotel and restaurant sector is a merged category also covering the transport, retail and wholesale sector due to low numbers.
In sum, the overall changes in part-time work, especially marginal part-time work, has increased in Denmark, Iceland and Finland between 2000 and 2015, while the overall share of part-time work has decreased slightly in Sweden and Norway during the same period. The changes in part-time work seems to be closely tied to cyclical swings in the labour market. For example, Finland, Denmark and Iceland saw a downturn in the labour market when the financial crisis hit the Nordic labour markets in 2008, leading subsequently to a rise in part-time work, but not necessarily mirroring a decline in full-time employment, except for Finland. The share of full-time employment when measured in actual numbers slightly decreased between 2008 and 2011 in Iceland and between 2008 and 2012 in Denmark, but then started to increase, although less rapidly than part-time work. In Finland, the share of full-time employment continued to decline during the same period, while Norway and Sweden saw a steady job growth in both part-time and full-time positions between 2008 and 2019 (Eurostat 2020c). However, Nordic companies’ usage of part-time work varies considerably across sectors. In the hotel and restaurant sector, more than one in two jobs are either short or long part-time in Denmark, compared to 40 per cent of all jobs in the Norwegian hotel and restaurant sector and one in four jobs in the Swedish and Finnish hotel and restaurant sector. The Nordic creative sector also relies extensively on part-time work and thus in some sectors, part-time work – covering both long and short hours – are nearly three or in some instances four times higher than the national average in each of the Nordic countries (fig. 1.4; 1.5; 1.6). These sector variations as to the type and levels of NSW become even more evident when examining distinct forms of temporary employment.
Temporary employment is yet another form of NSW that is common across the Nordic countries. It is an umbrella term that covers both fixed-term contracts and TAW, as the latter is not measured separately in some of the Nordic LFS data. Most temporary jobs are fixed-term contracts since TAW continues to remain marginal across the Nordic labour markets ranging from 1.5-2 per cent of all employees in Norway, 1.3 per cent in Sweden, 1.9 per cent in Finland to 0.6 per cent in Denmark (Eurostat 2020d; Alsos & Evans 2018). In this context, it is important to note that the figures on TAW include TAW holding temporary contracts as well as open-ended contracts in Finland, Sweden and Norway, while in Iceland and Denmark, all TAWs are employed on temporary contracts.
Since 2000, the share of temporary workers has remained fairly stable across the Nordic region, except for Iceland and Sweden (fig. 1.7). In Sweden, the share of temporary workers increased from 13 per cent of all employed in 2000 to 15 per cent in 2019. In Iceland, the share of temporary workers increased from 4 per cent of all employees in 2000 to 12 per cent in 2013, when it peaked and has during the subsequent period of strong employment growth continued to decline and stood at 7 per cent in 2019 (fig. 1.7). Thus, over time, Icelandic employers appear to have shifted their usage of temporary employment from a pattern fairly similar to Swedish and Finnish employers in the post-crisis years to an employment pattern that is more like their Danish (10 per cent are temporary workers) and Norwegian (7 per cent are temporary workers) counterparts in 2019. Notable is also the hike in temporary employment in Denmark in 2016, but these changes are merely due to problems with the data quality in the Danish LFS from 2016 rather than reflecting a genuine increase in the share of temporary employment.In 2016, Statistics Denmark decided to outsource the data collection for the LFS to a new private supplier and that caused problems with the data quality in the Danish LFS in 2016 (Statistics Denmark 2019e). By 2019, temporary employment accounted for around 14 per cent of all employed in Finland and 15 per cent Sweden compared to 10 per cent in Denmark, 9 per cent in Iceland and 7 per cent in Norway (fig. 1.7).
Most temporary contracts typically have a duration of less than 6 months. In Iceland, nearly nine out of ten temporary workers hold a temporary contract of less than 6 months compared to nearly three in four temporary workers in Finland (table 1.1). Also, in Sweden and Denmark, short-term contracts are common with nearly one in two of all temporary contracts being less than 6 months in 2018. However, Norway and Denmark both stand out similarly in that only 15 per cent of temporary contracts in Norway and 13 per cent of temporary contracts in Denmark are less than 3 months compared to 41 per cent in Iceland, 33 per cent in Finland and 28 per cent in Sweden (table 1.1). These figures indicate that a large group of temporary workers hold contracts of less than six months or even shorter, and their share has increased in all the Nordic countries, except perhaps for Norway, since 2000. In 2000, around 58 per cent of temporary workers held contracts of less than six months in Norway compared to 48 per cent in Iceland, 45 per cent in Finland, 43 per cent in Sweden and 32 per cent in Denmark (authors’ own calculation based on LFS data published by Eurostat 2020e). The marked decline in Norway may partly be linked to the increased non-response rate (table 1.1).
|Less than 3 months||4–6 months||12+ months||No response||Total|
The share of temporary employment varies not only across the Nordic countries, but also across sectors. In some sectors, such as education in Finland and the category Other Services (for example hairdressing or repair of computers (Eurostat 2008: 88) in Iceland, one in four of all employees hold temporary contracts. In Sweden, these numbers are even higher in sectors such as hotels and restaurants, the creative industry and administration with almost a third of employees being temporary workers. In Denmark and Norway, the incidence of temporary jobs is markedly lower even for the three sectors with the largest share of temporary employment (13 per cent) (fig. 1.8).
*Note for Iceland, Administration and services is a merged category that covers public administration, defence, health and social work due to low numbers.
In sum, these findings suggest that Swedish, Finnish and Icelandic employers are more likely to draw on temporary contracts to secure flexibility than their Danish and Norwegian counterparts, who in turn tend to rely more on other forms of non-standard work, especially marginal- and long part-time work as seen in the previous section. In fact, the share of temporary workers in some Icelandic, Swedish and Finnish sectors are twice as high as the national aggregated data, while in Denmark and Norway, the incidence of temporary employment in distinct sectors seem to only be slightly higher than the national average (fig. 1.7 and 1.8). However, overall changes in temporary employment seem, similarly to the fluctuations in part-time work, to some extent to mirror cyclical changes in the labour market. Icelandic employers were more likely to rely heavily on temporary employment in the post-crisis years (2008- 2012) and the figure has declined in the aftermath of the financial crisis. In Finland and Sweden, the number of temporary workers declined when the financial crisis hit the Nordic labour markets, but then started to marginally increase in the first few years after the crisis (fig. 1.7).
Solo self-employment is a different category of NSW as such workers are typically considered micro-companies but are without employees and tend to offer their services to only one or few other companies. Since 2000, solo self-employment has become more prevalent in Finland, but has declined in Norway, Sweden and more rapidly in Iceland. In Denmark, the share of solo self-employment continued to increase up until 2012 and has since then marginally decreased: 9 per cent of all employed were solo self-employed in Finland in 2019 compared to 8 per cent in Iceland, 6 per cent in Sweden and 5 per cent in Denmark and Norway, respectively (fig. 1.9).
Agriculture, forestry and fishery is by far the sector with the most solo self-employed people, ranging from 21 per cent in Denmark to 51 per cent in Finland. This is nearly five times higher than the national average for the Nordic labour markets (fig. 1.9 & 1.10). Another sector with high shares of solo self-employment is the category Other Services, where nearly one in five of all employed are solo self-employed in Finland, Iceland and Sweden compared to 14 per cent in Norway and 12 per cent in Denmark in 2015. Also, the creative industry has many solo self-employed, most notably in Norway and Finland where one in five workers is solo self-employed compared to 17 per cent in the Swedish creative sector (fig. 1.10).
As in other European countries, women, young people - especially students -, foreign born, older workers aged 65+ and lower skilled workers tend to be overrepresented among non-standard workers also in the Nordic countries. However, important variations exist depending on the type of NSW under consideration as well as across countries and sectors. To capture these differences, each national team conducted logistic regression analyses for each of the four employment types, where they controlled for gender, age, ethnicity, educational attainment, multiple jobholding and sector (see appendix). The regression analyses indicated that the likelihood of taking up part-time work, temporary employment or self-employment was higher among some groups than others. We also find that NSW may be a choice for some, while others involuntarily have to accept non-standard work.
Marginal part-time work seems to attract especially young people aged 15-29 years – typically students – and older workers (65+). Women, foreign-born and lower skilled workers are also overrepresented among marginal part-time workers. Many with contracts of few hours tend to combine two or more jobs, suggesting that multiple job holding is often a way to make ends meet for marginal part-time workers (appendix). Their main reason for taking up marginal part-time work is for many a voluntary choice, especially in Denmark and Iceland (fig. 1.11). However in Finland, the share of people that involuntarily accept a contract of few hours has increased from 17 per cent in 2008 to 21 per cent in 2015, which may be closely tied to the economic downturn in the Finnish labour market that lasted until 2015/2016 (fig. 1.11). In the other four Nordic countries, the share of involuntary part-time work has remained fairly stable, but important cross-country variations exist: In Sweden, one in four marginal part-time workers would prefer a full-time job compared to 16 per cent in Norway, 5 per cent in Denmark and 4 per cent in Iceland (fig.1.11).
Note: Figures for involuntary solo self-employment are only available for 2017 and this is a merged category covering inability to find a job as an employee, had not planned or wanted to work as solo self-employed and their former employer had requested that they worked as solo self-employed.
Long part-time work is particularly common among students followed by older people aged 65 or more in Finland, Norway, Iceland and Denmark. In Sweden, the likelihood of holding long part-time work among older workers (65+) is as high as among students (appendix). Recent pension reforms, involving various financial incentives, changes in the statutory retirement age and distinct work arrangements to retain older workers in paid work may account for the large share of older people among the group of part-time workers in the Nordic labour markets (Ojala et al. 2020). Although older people similarly to students tend to be overrepresented among part-time workers, we also find that other groups such as women, lower skilled and foreign-born individuals are more likely to take up long part-time work and many often hold multiple jobs. Working reduced hours is a voluntary decision for many as the incidence of involuntary long part-time ranges from 12 per cent in Iceland to 33 per cent in Finland in 2015. The share of involuntary long part-time work has increased somewhat in all five Nordic countries since 2008 (fig. 1.11). Among Danish and Icelandic part-time workers, particularly those working between 15- 29 hours per week, a growing number choose to work reduced hours due to own disability or illness (Rasmussen et al. 2020; Olafsdottir et al. 2020).
Temporary employment is more prevalent among young people and students in all five Nordic countries. In Sweden and Norway, older workers (65+) stand out as a group among temporary workers. In all five countries, we also find a slight overrepresentation of women, lower skilled, foreign-born individuals and multiple jobholders (appendix). Many temporary workers involuntarily accept temporary jobs, especially in Finland, Sweden and Norway, and their numbers have grown since 2008. Around 70 per cent of temporary workers in Sweden would prefer a permanent job compared to 70 per cent in Finland, 67 per cent in Norway, 43 per cent in Denmark and 11 per cent in Iceland (fig. 1.11).
Solo self-employment is more likely a career path among older male workers in all five Nordic countries and they often work in certain sectors such as agriculture, forestry and fishery (fig. 1.10). Solo self-employment is also common among students in Sweden, Denmark, Finland and Iceland (appendix). Other characteristics for this group are that many tend to be lower skilled, and at least some of the solo self-employed supplement their income with other jobs (appendix). Their main reasons for pursuing a career as solo self-employed have recently been explored in the LFS’s 2017 ad hoc module, which indicated that the vast majority of solo self-employed have voluntary opted for such a career. Many prefer solo self-employment to gain increased working time flexibility, especially in Norway (30 per cent of all solo self-employed), Iceland (22 per cent) and Sweden (20 per cent), while this only applied to 12 per cent in Finland and 14 per cent in Denmark. Others saw solo self-employment as a suitable opportunity, especially in Denmark, Sweden, Iceland and Finland, where more than one in five listed this as their main reason for taking up solo self-employment compared to 11 per cent in Norway (authors’ own calculations of LFS data in Eurostat 2017a). In fact, hardly any individuals had accepted solo self-employment involuntarily in Iceland compared to 14 per cent in Finland, 13 per cent in Norway, 11 per cent Sweden and 8 per cent in Denmark (fig. 1.11).
In sum, involuntary NSW has increased in the five Nordic countries during the last two decades. It is particularly prominent in Sweden, Finland and Norway and lowest in Denmark and Iceland. The share of people that have had to accept involuntary non-standard jobs varies across countries and types of NSW. Solo self-employment and part-time work are for many a voluntary choice, while this is less so in the case of temporary jobs. Older workers, young people (students in particular), women and foreign-born individuals are more likely to take up part-time and temporary employment, whilst men, often older, are more likely to pursue a career as solo self-employed in all five Nordic countries.
A growing body of international literature has studied NSW and often points to the methodological challenges that are tied to analysing the new, emerging forms of NSW such as zero-hour contracts, on-call work and platform work (Frosch 2017; Ryan et al. 2019). First and foremost, there exists no common statistical conceptual framework that defines NSW within the Nordic and international statistical standards, and thus NSW are typically ambiguously defined (Frosch 2017). The share and types of NSW tend therefore to differ depending on the used definitions and categories of non-standard as well as the employee groups under examination. For example, the OECD (2020a) in its recent Employment Outlook defines NSW as temporary employment, part-time work and solo self-employment. Implicitly this presumably indicates that the OECD regards the emerging forms of NSW such as zero-hour contracts and on call work as sub-groups or variants of the former categories of non-standard work. Similarly, research tends to define part-time work differently, where some studies and statistical offices such as Eurostat and the Nordic statistical offices operate with a rather broad definition of part-time work, both including longer hours up to what is nationally considered the normal weekly working hours. The “normal” weekly working week is considered 37 hours per week in Denmark, 40 hours in Norway, Sweden, Iceland and Finland by law, but with important inter-sectoral variations as most, if not all, collective agreements operate with lower thresholds for what is considered full-time work (see country chapters 3–7). By contrast, the OECD’s threshold for part-time work is, similar to the definition adopted in this report, 30 weekly working hours and thus the OECD’s figures on part-time work are slightly more conservative than the figures by for example Eurostat (OECD 2020a). In addition, the definitions on marginal part-time work tend to vary across the Nordic countries with the notion of contracts of few hours, ranging from less than 19 weekly working hours to 15 weekly working hours or even lower in some instances (see country chapters 3–7).
Also, temporary employment is typically measured differently in the Nordic countries and tends to be an umbrella term for both fixed-term employment and TAW in most surveys. In fact, in some of the Nordic LFS data, TAW is not measured separately, even if research indicates that the working conditions, employment- and social protection of TAW often differ considerably from fixed-term workers, who often have longer employment contracts (Alsos & Evans 2018; Mailand and Larsen 2018). There are also challenges associated with analysing solo self-employment using the Nordic LFS data, since some forms of solo self-employment are not covered by LFS such as workers operating in the grey-zones of being employees or own-account workers (Frosch 2017). In fact, many of the emerging forms of NSW such as on-call work, zero-hour contracts and platform work and posted workers are not yet systematically documented by existing surveys and register data. Ample research thus indicates that existing surveys underestimate the range of such groups as they are not well covered by the LFS or Nordic register data (Ilsøe & Larsen 2020a; Frosch 2017; see country chapters 3–7). Many of these groups also tend to be multiple jobholders often with two or more jobs, which is not captured by for example the LFS, as it only distinguishes between primary and secondary jobs. We also find that many of the traditional and emerging forms of NSW tend to overlap, where for example solo self-employed workers work reduced hours or a TAW holds an open-ended contract, but work reduced hours, which poses further methodological challenges as to measuring these forms of work. Therefore, only some employment patterns among European workers, especially non-standard workers, are documented by the LFS survey, even if it is the most comprehensive survey on employment forms in the Nordics. Access to better data on distinct forms of NSW is pivotal to better apprehend the dynamics and changes going on outside the core of the Nordic labour markets. This is all the more warranted as many national governments and social partners, including the Nordic, rely on LFS data and register data when developing new social- and labour market policies.
When it comes to the categories of on-call work, zero-hour contracts, platform work and posted workers that have emerged or increased in recent years, there are also important differences in how these concepts are defined within the literature. Thus, the empirical results as to their numbers vary considerably from one study to another and point to the need for comparable international data based on a similar framework.
On-call work refers to ad hoc working arrangements with no predictable fixed hours and may involve very few hours or no guaranteed hours. The definition of on-call work differs across the Nordic countries and may in some instances include zero-hour contracts, i.e. employment contracts with no or few guaranteed hours (see below). On-call work is not regularly measured in the Nordic LFS and will presumably be subsumed under part-time or temporary work. However, on-call work was part of an ad hoc module in the LFS survey in 2004, where 1.2 per cent of all employees in Denmark, 1.9 per cent in Finland, 2 per cent in Sweden and 3.6 per cent in Norway reported that they only work when called in. The share of workers with on-call arrangements were statistically insignificant in Iceland (Frosch 2017; Eurostat 2004: lfso_04oncwisna). Recent studies including our qualitative chapters suggest that on-call work has become more widespread in the Nordic countries, especially in sectors such as eldercare and private services including retail, hotels and restaurants, etc. (Bach et al. 2020; Hedenus & Rasmussen 2020).
Zero-hour contracts are open-ended or temporary employment contracts with no or few guaranteed weekly working hours and may involve on-call work depending on the national context. Across the Nordic countries, zero-hour contracts are defined differently. For example, Finnish legislation refers to zero-hour contracts as open-ended employment contracts with no guaranteed work or pay. In Norway, there is no explicit reference to zero-hour contracts or definition of this, but the Norwegian Working Environment Act requires that in order for employees to be employed on an open-ended contract they must be ensured predictability of employment in the form of a clearly specific number of paid working hours (Norwegian Working Environment Act§ 14:9). In Denmark, there is no official definition of zero-hour contracts, but this form of working arrangement tends to refer to employment contracts with no guaranteed working hours and includes among others on-call work, some open-ended and temporary employment contracts. Zero-hour contracts are not measured separately in the LFS; and it is only Finland among the five Nordic countries that has started to regularly measure the number of employees with zero-hour contracts. Statistics Finland defines zero-hour work as employment contracts where the minimum number of working hours promised/guaranteed is zero. Around five per cent of all employees in Finland aged 15–74 worked on a zero-hour contract in 2018 with higher numbers in service sectors such as retail, hotel and restaurants, health and social care (Pärnänen & Sutela 2019). Other studies suggest that the share of people with zero-hour contracts has increased in all five Nordic countries, but with marked sector variations, which also echoes the findings within our chapters on emerging forms of NSW (Eurofound 2015; Bach et al. 2020; Hedenus & Nergaard 2020; Hedenus & Rasmussen 2020).
Platform work refers to an employment form where individuals use online digital intermediaries to provide, sell or purchase specific labour-intensive services. There is no common definition of platform work, and it tends to differ depending on the types of websites and apps that are included as well as the forms of services provided including paid and unpaid work (Howcroft & Bergvall-Kåreborn 2019; Ilsøe & Larsen 2020a; Jesnes & Oppegaard 2020; Söderqvist & Bernhardtz 2019). A growing number of studies has estimated the size of the Nordic platform economy, but only in Denmark and Finland have there been ad hoc modules in the national LFS survey measuring the size of the digital platform economy. These studies based on the LFS surveys estimate that around 1.2 per cent of all Finns and 1 per cent of all Danes had accrued income via a digital labour platform in 2017, and in the case of Finland these figures also include individuals selling second hand goods via online platforms (Ilsøe & Larsen 2020b; Sutela & Pärnänen 2018). Other studies estimate that around 1 per cent of Norwegians and 2.5 per cent of Swedes have been selling their labour via an online platform, while there are no such figures available for Iceland (Alsos et al. 2017b). Nevertheless, it is likely that these studies underestimate the scope of the platform economy as for example migrants without residence permits often sell their labour via digital labour platforms, but are not captured by the LFS, and thus call for innovative methods to better apprehend distinct forms of digital platform work.
Posted workers are often defined along EU’s definition and refers to workers that are sent by their employers to carry out work (services) in another EU member state on a temporary basis through contract of services or intra-group mobility or are hired out through a temporary agency. There exists no comparable, reliable EU data on the share and numbers of posted workers (De Wispelaere et al. 2019). However, in some countries such as Denmark, data on the share of posted workers appears more reliable compared to other countries, since foreign companies are requested by Danish law to register their posted workers in the so-called RUT register when operating in Denmark (Arnholtz & Andersen 2016). Nevertheless, it remains a methodological challenge to identify and document the number of posted workers across the Nordic countries (even if it is an area that has attracted much academic and political attention, especially since the EU enlargements in 2004 (Arnholtz et al. 2018; Eurofound 2020a; Alsos & Ødegaard 2018).
In sum, the LFS is one of the most comprehensive surveys on employment forms in the Nordic countries. Together with the unique Nordic administrative register data, the LFS survey is an important source to gain insights into the development in NSW across the Nordic countries. These data are not only used by researchers to advance our understanding of the Nordic labour markets, but also policy makers draw on these data for policy development. However, the emergence of novel non-standard ways of organising work on the Nordic labour markets poses a challenge as these forms of employment are not yet systematically documented by the existing surveys and register data. In addition, groups of workers without permanent residence in the Nordic countries are excluded from the LFS, as they cannot take part in the survey, and therefore their employment situation is not depicted by the LFS. Thus, it calls for new methods and data sources to secure reliable data that capture these emerging groups in the Nordic labour markets as well the groups of workers without permanent residence in the Nordic countries.
Overall, the share of NSW has remained fairly stable across the Nordic countries since 2000. It ranges from 26 per cent in Sweden to 31 per cent in Iceland, but there are marked cross-country and sector variations as to the share and the type of NSW Nordic employers rely on to secure a flexible workforce. The variations in NSW mirror to some extent cyclical fluctuations in the labour markets. During periods of economic slowdown, temporary workers, especially TAW, are often the first to be dismissed while part-time and temporary work seem to increase in post-crisis periods, but not necessarily at the expense of full-time work (Eurostat 2020b; 2020c; 2020d).
NSW is particularly widespread in the Nordic creative industry, the hotel and restaurant sector and the category Other Services. However, the main type of NSW Nordic employers rely on differs considerably across countries and sectors. Swedish, Finnish and Icelandic employers are more likely to rely on temporary contracts to secure flexibility than their Danish and Norwegian counterparts, who tend to rely more on marginal and long part-time work. Solo self-employment is the least widespread form of NSW in all the five Nordic countries, except in the primary sectors (agriculture, forestry and fishery) Likewise, the levels of temporary employment are nearly twice as high as the national aggregated data in some sectors such as the creative sector and the hotel and restaurant sector in Finland, Sweden and Iceland. Also Nordic companies’ use of part-time work varies considerably across sectors and is particularly widespread in private services such as hotels and restaurants, where more than one in two jobs are part-time in Denmark compared to 40 per cent in the Norwegian sector and one in four jobs in the Swedish and Finnish hotel and restaurant sector. Therefore, our findings point to the need to look behind the aggregated data if we want to capture the specific changes of NSW in the Nordic labour markets. In this context, the emerging forms of NSW such as on-call work, zero-hour contracts, platform work and posted workers are yet to be systematically documented by the Nordic LFS and register data. New methods and data sources are warranted to secure reliable data that also captures these emerging employment forms to better apprehend the development of NSW across the Nordic countries and support policy development.
Like earlier studies, our findings confirm that women, young people (especially students), foreign-born, older workers (65+) and lower skilled workers are overrepresented among non-standard workers in the Nordic countries. However, important variations exist depending on the type of NSW under consideration as well as across countries and sectors. Older workers, young people (students in particular), women and foreign-born individuals are more likely to take up part-time and temporary employment, whilst men, often older workers, are more likely to work as solo self-employed in all five Nordic countries. We also found that involuntary NSW has increased in the Nordic countries during the last few decades. It is particularly prominent in Sweden, Finland and Norway and lowest in Denmark and Iceland. The share of people that have had to accept involuntary NSW also varies across types of NSW. Solo self-employment and part-time work are often a voluntary choice, while this is less the case for temporary jobs.
In sum, each type of NSW delivers a distinct blend of flexibility for Nordic companies as well as employees. However, the rising share of NSW in some sectors combined with the recent increase in the share of involuntary NSW pose challenges to the Nordic labour markets, especially if Nordic governments and social partners are unable to secure a social safety net for these workers. In the next chapter, we explore the risks associated with NSW as well as how Nordic governments and social partners have responded to the novel developments among NSW in the Nordic labour markets.
By: Trine P. Larsen & Anna Ilsøe
Non-standard work (NSW) is often associated with greater risks of lower levels of job and income security, lower pay and social protection gaps, even if the Nordic labour markets in general demonstrate high wage levels, generous employment- and social protection and high living standards (OECD 2020b; Rasmussen et al. 2019). The regulatory framework for NSW is often argued within the literature to contribute to gaps in employment- and social protection experienced by non-standard workers (OECD 2018; Rubery et al. 2018). Recent national debates and policy reforms address some of the regulatory challenges often associated with NSW, but different themes have been on the agenda of social partners and national governments in the Nordic countries, reflecting variations across countries and sectors in the size and type of NSW seen in the previous chapter. However, ample research also reveals that NSW may involve elements of social inclusion and thus in some instances may be of stepping stone into the labour market for some groups or a way to retain people in paid work that may otherwise struggle to commit to a full-time job (Gash, 2008; Berglund et al. 2017.
In this chapter, we explore the different forms of insecurities and opportunities typically associated with NSW such as risks of in-work poverty, income insecurity arising from underemployment and job insecurity as well as opportunities tied to NSW like elements of social inclusion across the five Nordic countries. To identify potential employment and social protection gaps and whether Nordic governments and social partners have addressed them, we briefly compare how NSW is regulated in each Nordic country and give examples of recent policy debates and responses. While our primary focus is on the more traditional forms of NSW such part-time work, fixed-term contracts, temporary agency work (TAW) and solo self-employment in Denmark, Finland, Iceland, Norway and Sweden, we also briefly mention examples of policy initiatives that target emerging forms of NSW.
Our comparative analysis draws on the findings from the national country reports prepared by the following national teams listed in the prefaceThe national teams are: Denmark (Stine Rasmussen, Trine P. Larsen, Anna Ilsøe, Per Kongshøj Madsen, Emma S. Bach); Finland (Satu Ojala, Tiina Saari, Pasi Pyöriä, Paul Jonker-Hoffrén, Jouko Nätti), Iceland (Katrin Olafsdottir, Kolbeinn Stefansson, Arney Einarsdottir), Norway (Kristine Nergaard), Sweden (Tomas Berglund, Anna Hedenus, Kristina Håkansson, Tommy Isidorsson).. The findings from these national reports have also been triangulated with secondary empirical data, policy documents, collective agreements, and legislation to capture debates and policy responses that are more recent in each Nordic country.
This chapter is structured as follows: In the first section, we explore the risks often associated with NSW such as in-work poverty, income insecurity in the way of underemployment and job insecurity. In section two, we briefly compare the regulatory framework for NSW in the five Nordic countries, before we in section three give examples of recent policy debates and initiatives. In the last section, we sum up our main findings and draw conclusions.
NSW is often associated with increased risks of lower levels of job and income protection, which can be captured by different measures (Rubery et al. 2018; Standing 2011; Kalleberg 2011). In this chapter, we distinguish between three types of insecurities, namely risks of in-work poverty, income insecurity arising from underemployment and job insecurity in terms of uncertainty or instability associated with an individual’s present job. We define In work-poverty along the lines of the definition used by Eurostat – EU SILC survey (2020)It is measured as the share of persons, who are employed and have an equivalised disposable income below the risk of poverty threshold, which is set at 60 per cent of the national median equalised disposable income after social transfers. An individual is considered employed if they have been in paid employment for more than half of the reference year.. To measure the risks of in work poverty, we draw on the recent figures published by Eurostat based on the EU SILC survey (statistics on income, social inclusion and living conditions) (Eurostat – EU SILC survey 2020). Income insecurity in the form of underemployment and job insecurity are defined as integrated measures in that they are constructed based on several empirical indicators and subjective dimensions, which were initially inspired by Pyöriä & Ojala (2016) and Håkansson & Isidorsson (2015), and further developed by Rasmussen et al. (2019). Here we draw on the construction of these measures developed by Rasmussen and colleagues (2019) based on selected Labour Force Survey (LFS) indicators. In line with their work, we understand income insecurity as a situation in which an individual considers themselves to have inadequate income (or be at risk of having an inadequate income) and we therefore define this as underemployment. We use their integrative measures for income insecurity that combine three items listed in the LFS: 1) a wish to work more hours than the current job allows; 2) seeking an additional job to add more hours to those worked in present job and/or 3) seeking a job with more hours worked than in the present job. Income insecurity is defined as answering yes to one or more of these three items, as they imply time-related underemployment according to ILO’s definition (1998), i.e. individuals express their dissatisfaction with their weekly working hours in their present job (Rasmussen et al. 2019: 13). Job insecurity is here defined along the lines of the work by Rasmussen et al. (2019) and thus understood as uncertainty or instability associated with an individual’s present job. Two items listed in the LFS are used to measure job insecurity: 1) looking for a new job because of risk or certainty of loss or termination of present job and/or 2) main activity one year earlier: unemployed. Job insecurity is defined as answering yes to one or both questions as they both relate to insecure work histories, where earlier research indicates that past unemployment experiences predict later perceptions of job insecurity (Kinnunen & Nätti 1994; Rasmussen et al. 2019). These measures are used to explore the risks of income and job insecurity experienced by non-standard workers.
Ample research also reveals that NSW may involve elements of social inclusion. In this chapter, we distinguish between two elements of social inclusion often associated with NSW, namely NSW as a stepping stone and a retention strategy. NSW may represent a stepping stone for groups such as long-term unemployed, people with reduced work capabilities, young people and migrants that may struggle to gain a foothold in the labour market by offering lower entry barriers in labour markets with high wage levels, high productivity demands, language barriers etc. (Gash, 2008; Berglund et al. 2017; Ford et al. 2017). NSW may also enable individuals to test new career avenues and entrepreneurial dreams or offer possibilities to retain workers in the labour market such as parents with small children, older workers or retirees, who are unable to commit to a full-time jobs, by allowing them to organise their work in more flexible ways (Campion et al. 2020; ILO, 2015 ). We use these concepts to explore some of the opportunities often associated with NSW from the perspective of non-standard workers.
In all five Nordic countries, the risk of in-work poverty is below the EU average, but seems to be higher in association with NSW (fig. 2.1). Temporary workers are particularly exposed to increased risk of in-work poverty, but more so in Norway and Sweden, where nearly twice as many temporary workers reported in-work poverty compared to Denmark, Iceland and Finland (fig. 2.1). Many part-time workers also experience increased risk of in-work poverty compared to their peers in full-time employment: nearly one in ten in Finland, Norway and Sweden report of earnings below 60 per cent of the median wage compared to 8 per cent in Iceland and Denmark (fig. 2.1).
Note: figures for Iceland are from year 2016.
The increased risk of in-work poverty among non-standard workers may also be closely related to underemployment and higher job insecurity. Recent studies suggest that low earnings among non-standard workers tends to be closely linked to struggles to secure enough working hours or project assignments to sustain a basic minimum income rather than sub-standard hourly wages (Ilsøe et al. 2017). In fact, the de facto average hourly wages are often higher than the statutory or collectively agreed minimum wages, which are comparatively high in all the Nordic countries even in the low-paid sectors (Rasmussen et al. 2019: 12; Eurostat 2017b).
Income insecurity caused by underemployment is higher among non-standard workers compared to their peers in full-time open-ended positions in Denmark, Finland, Norway and Sweden. We have not been able to explore this for Iceland due to too few observations in the Icelandic LFS. However, the risks of income insecurity often vary across distinct types of non-standard work. Swedish and Finnish marginal part-time workers seem to experience higher levels of income insecurity, not only compared to their Danish and Norwegian peers, but also compared to other groups of non-standard workers in Finland and Sweden (fig. 2.2). In fact, the share of income insecurity associated with NSW is highest in Finland and Sweden and lowest in Norway and Denmark. In Finland, the share of income insecurity ranges from 15 per cent for fixed-term workers, 18 per cent for solo self-employed, 26 per cent for TAW and 31 per cent for marginal part-time workers. In Sweden, these figures are slightly lower, ranging from 9 per cent for TAW to 35 per cent for marginal part-time workers, but still higher than in Denmark and Norway. In Denmark, the share of income insecurity ranges from 7 per cent to 17 per cent while ranging from 12 per cent to 21 per cent in Norway (fig 2.2; Rasmussen et al. 2019). The higher levels of income insecurity among Swedish and Finnish non-standard workers may be due to the higher share of non-standard workers having to involuntarily accept NSW or low-paid work in Finland and Sweden, while NSW more often is a voluntary choice in Denmark and Norway (Rasmussen et al. 2019). The fact that students are more likely to take up NSW in Denmark and Norway than in Sweden and Finland may also explain why the levels of income insecurity are comparatively higher in Sweden and Finland (Rasmussen et al. 2019).
Note: Results from linear probability models for analysis of differences in the extent of income insecurity between persons in NSW and full-time, permanent job in 2010–2015. Sig. (p) <0.001 for all calculations, controls: gender, age, marital status, level of education, nationality and economic sector.
NSW is associated not only with increased risks of income insecurity, but also with higher levels of job insecurity compared to the standard full-time open-ended contract, which seems to be closely tied to economic cyclical fluctuations in the labour market (fig. 2.3). For example, temporary workers, notably TAW, are often some of the first to be made redundant when there is an economic downturn. However, they also are some of the first to be rehired in post-crisis years as seen in chapter 1 (Larsen & Ilsøe 2020a) and documented by other research (Navrbjerg & Larsen 2017; Svalund et al. 2019; Håkansson & Isidorsson 2015). The high level of job insecurity among non-standard workers is most prominent in Finland and Sweden, where one in five fixed-term workers experiences job insecurity compared to less than one in ten in Denmark and Norway (fig. 2.3). Higher levels of job insecurity are also seen among TAW, solo self-employed and marginal part-time workers in Sweden and Finland compared to Denmark and Norway. For example, in Sweden and Finland, the share of TAW and marginal part-time workers that experience job insecurity is nearly twice as high as in Denmark and Norway (fig. 2.3). In Denmark, we also find that marginal part-time workers experience lower job insecurity than their peers in full-time open-ended positions, which may be due to the higher share of students among marginal part-time workers in Denmark compared to the other Nordic countries (Rasmussen et al. 2019).
Note: Results from linear probability models for analysis of differences in the extent of job insecurity between persons in NSW and full-time, permanent job in 2010–2015. Sig. (p) <0.001 for all calculations, controls: gender, age, marital status, level of education, nationality and economic sector.
In sum, our findings suggest that NSW is associated with increased risks of in-work poverty, income insecurity in the form of underemployment and job insecurity in all the Nordic countries. Our findings echo other Nordic research, where for example Svalund & Berglund (2017) indicate that many temporary workers continue to face a long-term vicious cycle of temporary contracts and unemployment in Norway and Sweden. Likewise, a number of Danish, Finnish, and other Norwegian and Swedish studies suggest that non-standard workers often struggle to gain access to statutory and bargained social benefits. They also tend to experience lower hourly wages and less protection against dismissals and lower job quality compared to their peers in full-time open-ended contracts (Scheuer 2017; Larsen et al. 2019; Nergaard 2016; Kongshøj Madsen 2015). Thus, the Nordic welfare model and not least the Nordic flexicurity model appear to struggle to secure social and employment protection for some of the most flexible groups on the Nordic labour markets. The cross-country variations in the institutional frameworks for regulating wage, working conditions and welfare benefits may account for some of the differences across the Nordic countries. These aspects are briefly explored in section 2.3 and 2.4.
NSW may not only be negatively associated with increased risks of in-work poverty, income insecurity and job insecurity, but may also hold the positive potential to retain or integrate groups that may struggle to gain a foothold in the Nordic labour markets. Ample research points to positive aspects associated with NSW. For example, a number of part-time workers have opted for reduced hours due to their own disability or illness, ranging from 9 per cent of all part-time workers in Iceland to 16 per cent of part-time workers in Norway (fig. 2.4). In addition, many part-time workers also choose to work reduced hours to care for their children, incapacitated adults or other family members and for personal reasons (fig. 2.4). Thereby, part-time work typically in combination with formal child- and eldercare seems to enable parents and other carers to continue in paid work during periods of childrearing or other family responsibilities (Laninger and Sundström, 2014).
Flexible working and a “suitable opportunity” are some of the main reasons that many opt for being solo self-employed in the five Nordic countries (fig. 2,4). Different studies support this notion and stress that many solo self-employed workers, including young people have opted for this work form to test their entrepreneurial dreams (Larsen et al. 2018; Campion et al. 2020; Nielsen et al. 2019). Other forms of NSW can also be seen as stepping stones for some to enter the labour market. For example, Berglund and colleagues (2017) indicate that temporary employment such as probationary periods often lead to permanent jobs, while other forms of temporary work such as on-call work or internships entail greater risks of unemployment after the temporary contract terminates. Other studies also suggest that NSW hold the potential to integrate marginalised groups such as long-term unemployed, migrants and young people into the labour market (Gash, 2008; Storrie, 2017; Healy et al. 2017). Thereby, we see that there are opportunities, but also risks associated with NSW, where the regulatory framework is often argued to be pivotal (Healy et al. 2017; Tassinari and Maccarrone 2017; Ejrnæs, 2006).
The Nordic labour markets are renowned for their collective bargaining models that regulate large parts of wage and working conditions in the Nordic labour markets (Andersen et al. 2014). Union density, collective bargaining coverage and workplace representation are high in all five Nordic countries, but vary considerably across sectors with the Nordic bargaining models being weaker in private services than for example in manufacturing and construction (Andersen et al. 2014; Kjellberg 2020; Nergaard 2020b; Koskinen et al. 2019). The sectors with low union density, collective bargaining coverage and weak workplace representation are often those with high levels of NSW (Rasmussen et al. 2019; Ilsøe et al. 2017). This combined with the fact that non-standard workers are less likely to be union members suggests that many non-standard workers employed in the private sector operate on the outskirts of the Nordic collective bargaining models (Scheuer 2017; Kjellberg 2020; Nergaard 2020b).
For non-standard workers not covered by collective agreements, there are still fairly extensive statutory social rights that apply. However, in some of the Nordic countries the statutory social rights are often less generous than the conditions stipulated in collective agreements, although important cross-country differences exist. For example, in Denmark, only parents covered by collective agreements have rights to parental leave with full wage compensation, paid caring days and extra holiday entitlements (Larsen & Navrbjerg 2018). Moreover, wage-setting is the domain of social partners in all the Nordic countries, but in Iceland and partially Norway the wage-setting is underpinned by legal extension of collective agreements, and in Finland the principle of general applicability of collective agreements secures a wage floor for those without collective agreements (Andersen et al. 2014; Dølvik 2016). In addition, access to social protection such as unemployment benefits varies across the Nordic countries and often depends on membership (Denmark, Finland and Sweden; Norway) as well as past employment records (Denmark, Sweden, Finland, Iceland), number of weekly working hours (Finland, Denmark, Sweden) and past earnings (Norway, Iceland, Denmark, Finland, Sweden). In Denmark, Finland and Sweden, membership of an unemployment insurance fund is optional, while this is mandatory in Norway and Iceland (Directorate of Labour, Iceland 2020a; Ministry of Social Affairs and Health 2020; Ministry of Employment, Sweden 2020; NAV 2020b). Recent studies suggest that non-standard workers are less likely to be members of an unemployment benefit fund in Denmark, Finland and Sweden (Scheur 2017; Kjellberg 2020; Kangas & Kalliomaa-Puha 2018).
NSW is also increasingly regulated through Nordic labour laws, not least following the implementation of different EU directives that have dealt with the emerging forms of non-standard workNorway and Iceland are not member of the EU, but have joined the European Economic Area (EEA) and are thus obliged to transpose and adhere to EU’s labour market directives.. These include among others the EU directives on written statements (1991), posted workers (1996; revised in 2018), part-time work (1997), fixed-term contracts (1999), TAW (2008), and most recently the directive on transparent and predictable working conditions (2019). Common for these directives is that they aim to prevent sub-standard wage and working conditions as well as combat unfair competition. The EU directives on part-time work, fixed-term contracts and TAW secure through the principle of non-discrimination that distinct groups of non-standard workers have similar rights as their peers in comparable full-time open-ended positions in all the Nordic countries. The EU directives on posted workers (1996; 2018) outline the rules that apply to workers sent by their employers to carry out services in another EU member state on a temporary basis through contract of services, intra-group or hiring out through a temporary agency (OJEU 2018, L 173/16).
The Directive on Transparent and Predicable Working Conditions (2019) is a revised version of the Written Statement Directive (1991) and targets a broader range of workers, including domestic workers, on-demand workers, platform workers, voucher-based worker, trainees, apprentices etc. This EU directive guarantees various minimum rights for workers with three or more weekly working hours over a four week period, which among others include a minimum predictability of work (guaranteed working hours, type of work and reasonable notification for when work commences (OJEU 2019, L186/105). Member states, including the Nordic countries, are required to implement the directive by August 2022. While it remains to be seen how the Nordic governments and social partners intend to implement the directive, once implemented, the directive is expected to improve the rights of non-standard workers such as platform workers and distinct groups of solo self-employed workers as they often work in the grey areas of the Nordic collective bargaining model with limited or no protection.
Besides EU regulations on non-standard work, there are also various legal acts and collective agreements that regulate NSW in the five Nordic countries. Thus, such national regulation secures the rights of non-standard work beyond the minimum rights stipulated by the EU directives.
In all five Nordic countries, there are various regulatory restrictions on temporary employment that aim to improve temporary workers’ job security, wages and working conditions as well as prevent abuse arising from successive usage of temporary contracts. While regulation on fixed-term work has existed for several decades in individual Nordic countries, the regulation of TAW is fairly recent and first started to emerge after the liberalisation of the former legal monopoly of public job centres to provide employment services in the Nordic countries in the early 1990s. This liberalisation entailed that private providers could provide TAW services from 1990 in Denmark, 1993 in Sweden, 1994 in Finland and 2000 in Norway, and shortly after, regulation on TAW’s wage and working conditions started to emerge in the individual Nordic countries (Eklund 2001; Andersen & Karkov 2011; Alsos & Evans 2018).
The different national regulations on TAW entail i.e. that unlike Denmark and Iceland, TAW in Norway, Finland and Sweden can hold open-ended as well as fixed-term contracts. However, in Sweden and Finland such open-ended contracts are typically without any guaranteed pay between work assignments unless this is stipulated in collective agreements (Håkansson & Isidorsson 2015). This is not the case in Norway, where recent amendments to the Norwegian Working Environment Act that came into force in 2019 meant that contracts used in the temporary agency sector (permanent employment ”without pay between assignments”) no longer classify as permanent employment contracts, and compel employers to offer their workers a more predictable working hours (Nergaard 2020a). In Norway there have also been other recent reforms relaxing the regulations on the usage of temporary employment that allows fixed-term contracts for up to 12 months without justification. This reform has been accompanied with other regulatory changes (quotas, waiting periods (karenstid) and an upper limit for fixed-term employment without justification to 15 per cent of the company’s workforce to prevent employers’ misuse of the new rule changes (Nergaard 2020a). (OECD 2020b; Steen 2015; Nergaard 2020a). In Iceland, there are statutory restrictions to prevent abuse arising from successive temporary contracts: fixed-term contracts cannot be prolonged or renewed for more than two years. Icelandic labour law further stipulates that temporary work agencies are in principle not allowed to hire out an agency worker to a client company if that person has been directly employed at the same client company within the last six months (Icelandic Confederation of Labour 2013: section 3.5).
|Restrictions on temporary employment (TAW and Fixed-term workers)||+||+||+||+||+|
|Statutory guaranteed minimum pay if shift cancelled (only TAW)||+||+||+||+||+|
|Guaranteed minimum pay between assignments (only TAW)||-||+ |
(only if stipulated in collective agreements)
(only if stipulated in collective agreements)
|Rights to a permanent position after certain period with the company/organisation (only Fixed-term workers)||+ |
|Eligibility criteria for unemployment benefits, if covered by an unemployment insurance fund (TAW and Fixed-term workers||Average min 12 hours per week within the last 3 years (8 hours for part-time insured)||Min. 18 hours per week for the last 6 months within 28 months||Min. 40 hours within 1 month||Earned minimum NOK 149,787 within last 12 months||Average min. 20 hours per week for the last 6 months|
In Finland and Norway, there must be an objective reason to employ people as fixed-term workers, in line with the EU directive, or if such reasons are undocumented, employees have the right to a permanent position with some exceptions for TAW (Ojala et al. 2020; Nergaard 2020a). Moreover, in Finland, like Sweden, a fixed-term contract cannot be terminated before the fixed end date with few exceptions (MEAE 2018a; Berglund et al. 2017: 29). In Sweden, temporary workers (i.e. subsidies or general temporary contract) are additionally guaranteed a right to a permanent position after two years of employment with the same employer during the last five years (Berglund et al. 2017: 29). In Denmark, some sectoral agreements and local company agreements guarantee fixed-term workers and TAW a permanent position after three to six months’ employment with the company/client company (SBA et al. 2017; Navrbjerg & Larsen 2017). In addition, most Danish social partners have recently, through collective bargaining, lowered and in some instances removed the thresholds for accruing rights to collectively agreed social benefits and thus eased especially TAWs’ access to sick pay, further training, occupational pensions, extra holiday entitlements, bonuses and wage increases etc. (Larsen & Mailand 2018).
There are also examples of national reforms in the Nordic countries that may have weakened the rights of temporary workers. For example and unlike the other four Nordic countries, successive Swedish governments have gradually relaxed the employment protection for temporary workers since the early 1980s without changing the employment protection of employees on open-ended contracts (Berglund et al. 2017). Thus, Sweden has the widest gaps in employment protection among the five Nordic countries with temporary workers being easier to dismiss than permanent staff (Rasmussen et al. 2019; Svalund et al. 2017). Finland has also recently relaxed their regulations on temporary employment by allowing companies to recruit unemployed people as fixed-term workers for up to one year without specified reason, provided the person has been unemployed for more than one year (Ojala et al. 2020). In Denmark, the EU directive on fixed-term contacts (1999) opened up the possibility for a new form of temporary contracts based on objective reasons such as when permanent staff falls ill or takes parental leave rather than a fixed end date, whereby temporary workers with such fixed-term contracts have no rights to a notice period and can thus be dismissed without any notice (Larsen 2009). Likewise, in a number of Danish collective agreements, TAW and on-call workers are without rights to pensions, further training, sick pay, extra holiday entitlements or notice periods, but only some collective agreements compensate for the lack of such social rights through higher hourly wages for such workers (Larsen & Mailand 2014; Ilsøe et al. 2017).
Recent Nordic reforms of the unemployment benefit systems may also have restricted temporary workers’ access to unemployment benefits and sick pay. These reforms include for example the 2010 reform of the Danish unemployment benefit system and successive Danish reforms of sick pay entitlements, involving stricter eligibility criteria for accruing rights to unemployment benefits and sick pay (Mailand & Larsen 2018). Recent Finnish reforms include e.g. the so-called “new activation model” from 2016 and 2018, which involves new measures to transfer older long-term unemployed people (aged 60+) to the pension system, reduced benefits, stricter eligibility and harsher consequences if an unemployed person fails to comply with the conditions for active job search (Kangas & Kallioma-Puha 2017; 2018). Different eligibility criteria apply in all Nordic countries based on former employment records and weekly working hours (Sweden, Finland, Denmark and Iceland) or past earnings and hourly wages (Norway, Sweden, Denmark, Iceland and Finland) (table 2.1). Thus, temporary workers with contracts of less than three months, which ranges from 13 per cent in Denmark to 41 per cent in Iceland, or working reduced hours may struggle to accrue rights to unemployment benefits in case of unemployment (authors’ own calculations of LFS data in Eurostat 2020). However, in all five Nordic countries these eligibility criteria have been temporary suspended or relaxed during the corona crisis as described in chapter 12 (Larsen & Ilsøe 2020c).
Unlike TAW, there is no statutory guarantee of minimum working hours per shift for part-time workers in any of the five Nordic countries. Instead, there is an upper statutory threshold for the number of weekly working hours amounting to 48 hours per week over a four-week period following the implementation of the EU Working Time Directive (1993). Likewise, national labour laws (Norway, Sweden, Finland and Iceland) and collective agreements (Norway, Sweden, Finland, Iceland and Denmark) stipulate what is considered the normal working week. The statutory “normal” working week is 40 hours in Norway, Iceland, Sweden and Finland, but slightly lower in nearly all collective agreements, while 37 hours is considered the normal working week in Denmark. Unlike the other three Nordic countries, some Danish and Icelandic collective agreements guarantee part-time workers a minimum number of weekly working hours (SBA et al. 2017; DI & CO-Industri 2020; Pind 2020). In Sweden, Finland and Norway there are no such guaranteed minimum working hours for part-time workers in the collective agreements covering the large sectors of the labour market such as manufacturing, construction, transport, retail, hotels and restaurants, health and social care. However, in some Finnish sectoral agreements there are examples of minimum length for the individual shift of certain groups of workers. In addition, Norway has recently legally banned employment contracts without a minimum guarantee of work or pay – the so-called zero-hour contracts – but sets no lower threshold for what constitutes minimum work or pay (Hotvedt 2019). Likewise, Finland also has legal restrictions on the usage of zero-hour contracts, which are only allowed provided there exists a genuine reason, such as that the work varies unexpectedly or irregularly. Moreover, Finland also guarantees employees with zero-hour contracts rights to sick pay, unemployment benefits and pay during notice periods in case of dismissal (MEAE 2018b). In Sweden, Iceland and Denmark there are no similar legal restrictions on the use of zero-hour contracts or specific social rights for employees with zero-hour contracts, but in Iceland some collective agreements prohibit zero-hour contracts (tilfallandi vinna) (Pind 2020: 16). In fact, in Denmark, the regulatory framework such as the Salaried Employees Act and some collective agreements explicitly exclude employees with contracts of less than 8 hours from the statutory and collectively agreed social rights (Mailand & Larsen 2018). However, this may, along with the limited or no restrictions on zero-hour contracts, change with the implementation of the EU Directive on Transparent and Predicable Working Conditions, as this EU directive guarantees employees’ rights to a minimum of predictable work (OJEU 2019, L186/105).
|Guarantee of minimum work||+ |
|Restrictions on zero-hour contracts||-||+ |
(only if genuine reasons exist)
|Rights to part-time work||-||+||-||+||+|
|All workers, including part-time workers’ rights to request part-time work||+||+ |
(employers can only refuse part-time for older workers if genuine reasons exist)
|Rights to return to full-time employment||+|
|Rights to a position equivalent to their de facto working hours||-||+|
(CA may require regular update to contract)
|Eligibility criteria for unemployment benefits if covered by an unemployment insurance fund||Average min 12 hours per week within the last 3 years (8 hours for part-time insured)||Min. 18 hours per week for the last 6 months over 28 months period||Min. 40 hours within 1 month||Earned minimum NOK 149,787 within last 12 months||Average min. 20 hours per week for the last 6 months|
Recent regulatory changes in all five Nordic countries have aimed at improving part-time workers’ rights. Besides the principle of non-discrimination that yields similar social rights as for the full-time employed, all workers have the statutory rights (Norway, Finland, Sweden) or rights to request (Denmark, Norway, Finland, Sweden; Iceland) to work reduced hours. In Norway, Finland, Sweden and Iceland, this also includes the statutory rights (Norway, Finland, Sweden) or rights to request (Sweden, Iceland) to return to full-time employment. Some of these statutory and collectively agreed rights of part-time workers may only apply to specific groups such as older workers (Norway, Finland, Denmark) or parents (Denmark, Sweden, Norway, Finland) while others apply to all workers.
In Norway, part-time workers also have the statutory right to their position equivalent to their de facto working hours over the last twelve months, and employers are legally obliged to discuss part-time arrangements with workplace representatives at least once a year (Nergaard 2020a; Norwegian Working Environment Act). Moreover, in Norway, part-time workers also have a preferential right to an extended post rather than the employer shall create a new appointment in the undertaking (Norwegian Working Environment Act). In Denmark, public sector employees with contracts of few hours gained new rights in 2014 following an infringement letter from the European Commission. In this letter, the Commission considered it a breach of the EU Part-time Work Directive (1997) that public sector employees were without collective agreement coverage if working less than eight hours per week, and thus the new social rights were merely a response to the EU’s infringement letter (Larsen & Mailand 2018). The regulatory framework in all five Nordic countries also restricts the number of weekly and daily working hours for young people under 18 or in compulsory schooling, which may contribute to the high share of young people in marginal part-time employment (Ilsøe et al. 2017). Likewise, recent national pension reforms in all five Nordic countries have eased opportunities for older workers to reduce their working hours near retirement age or to continue in paid work, which may explain the high incidence of older workers in part-time employment.
While there have been a series of reforms that aim to improve part-time workers’ social rights and thus close the gaps in employment protection, various gaps continue to exist in social protection, not least regarding part-time workers’ eligibility for unemployment benefits. Part-time workers with contracts of less than 15 weekly hours typically struggle to meet the various eligibility criteria listed in table 2.2. They are a growing group in the Nordic labour markets, ranging from 4 per cent of all employed in Sweden to 11 per cent in Denmark and in some sectors they account for more than one in five of all employed in 2015 (chapter 1 by Larsen & Ilsøe 2020a).
Solo self-employment is a slightly different category of workers, and for some of these workers their status potentially falls within the grey areas between the notion of an employer and employee. Solo self-employed workers are typically without coverage from collective agreements due to their status as self-employed. Nordic labour law also tends to mainly protect wage earners and thus exclude solo self-employed workers due to the binary divide between self-employed and employee, where only the latter is protected by labour law regulations (Hotvedt et al. 2020). However, there are examples of collective agreements across the Nordic countries that cover solo self-employed workers such as digital platform workers (Denmark and Sweden) and freelancers (Denmark; Iceland), but when covered by collective agreement their employment status typically changes from self-employed to employee (Ilsøe 2020; Larsen et al. 2018; Jesnes & Oppegaard 2020; Pind 2020). However, the lawfulness of these arrangements remains uncertain as cases have yet to be brought before the labour courts, but until a juridical ruling is reached, such agreements remain the state of law (Hotvedt et al. 2020).
Likewise, an increasing number of Danish, Finnish, Swedish and Icelandic social protection schemes also apply to solo self-employed workers. In fact, Norway is the only Nordic country in which some groups of solo self-employed workers have no rights to unemployment benefits as only freelancers and employees are entitled to unemployment benefits, but not self-employed workers (Hotvedt 2020). However, all solo self-employed workers in Norway are, much like their Danish, Icelandic, Finnish and Swedish peers, covered by social security schemes for sick pay, provided they meet the eligibility criteria (Hedenus & Nergaard 2020; Hotvedt, 2020). However, the eligibility criteria that apply to solo self-employed workers in all Nordic countries are typically different and often ambiguous compared to other groups of non-standard workers. Therefore, their access to various statutory social benefits remains fairly restrictive (Mailand & Larsen 2018; Ojala et al. 2020; Kolsrud 2018). In Denmark, Sweden, Finland and Iceland, solo self-employed workers are forced to close down their company in order to be eligible for unemployment benefits. In the case of Sweden, if a solo self-employed worker becomes unemployed a second time within five years of receiving unemployment benefits, they will have no unemployment benefit rights (Kolsrud 2018). In addition, in Iceland, unlike the other Nordic countries, there is a statutory and mandatory occupational pension scheme that applies to solo self-employed workers and thus secures that this category of workers also accrues rights to occupational pensions (Olufsdottir et al. 2020). In Denmark, we find examples of unions having developed optional occupational pension schemes, in close collaboration with private pension funds, targeting solo self-employed workers.
|Covered by collective agreements||Only few||-||-||Only few||Only few|
|Rights to occupational pensions||-||+||+ |
(only if paid by solo self-employed during their career)
|Rights to unemployment benefits||+||+||+||+||-|
|Rights to paid parental leave||+||+||+||+||+|
|Rights to sick pay*||+|
|Eligibility criteria for unemployment benefits if covered by an unemployment insurance fund||Request Company closure|
Min. income of 6,482.67 DDK per month within the last 3 years
|Request of company closure |
Earnings-related based on tax declared income for the previous months prior to being unemployed
|Request company closure Income corresponding to min. unemployment benefits |
Earnings-based if own contributions are paid to self-employed’s unemployment fund
|Request Company closure |
Document company turnover
Net income corresponding to min. 20 hours per week over the last six months
Recent national debates and initiatives address some of the regulatory challenges associated with NSW, where different themes have been on the agenda of national social partners and governments in the Nordic countries, reflecting the country and sectoral variations. These debates have often been closely tied to discussions on social dumping, unfair competition, sub-standard wages and working conditions. This has notably been among migrant workers within low wage sectors including construction and in the case of Finland the shipbuilding industry, where there have been a series of prominent cases related to subcontracted and publicly procured work (Arnholtz & Refslund 2019; Nergaard 2020a; Ojala et al. 2020; Berglund et al. 2020). Various regulatory EU initiatives such its proposal to introduce a European minimum wage and the recently adopted directive on transparent and predictable working conditions have also sparked national debates and responses in all five Nordic countries.
Part-time work – notably contracts of few hours or no guaranteed working hours (zero-hour contracts) and involuntary part-time work – has been widely debated in all five Nordic countries, but in different ways. In Sweden, Norway, Finland, Denmark and less so in Iceland, involuntary part-time work has been a recurring theme on the political agenda. It has often been closely tied to the potential labour shortages in the health and social care sectors as well as to gender inequality. Part-time work tends to be seen as hindering gender equality and contributing to in-work poverty (Berglund et al. 2020; Nergaard 2020a). Women are more likely than men to work reduced hours during periods of childrearing across the Nordics, often as a means to reconcile work and care responsibilities (Rafnsdöttir & Hejistra 2013; Eydal & Rostgaard 2016). However, part-time work is often associated with lower pension contributions, earnings penalties and underemployment, and although part-time work is a voluntary decision by many, there is an increasing group of workers that involuntarily have to accept working reduced hours (Ellingsæter et al. 2019; van Breeschoten & Evertsson 2019).
To combat involuntary part-time work including zero-hour contracts and advance gender equality, a number of measures have been implemented in Norway, Denmark, Finland and Sweden. In Norway, these include the legal ban of zero-hour contracts, a preferential right to an extended post if the employment contract is open-ended, an entitlement to a post equivalent to the actual working hours over the last twelve-month period and annual discussions of part-time work at the workplace (Nergaard 2019; 2020a). Although fairly recent, these regulatory changes have been widely debated for years, and particularly the Norwegian trade union movement led by LO has long pushed for legal changes to reduce the occurrence of few-hour contracts (Sterud 2010; Nergaard 2020a).
In Sweden, there have been several yet unsuccessful policy proposals to introduce a general right to full-time positions for involuntary part-time workers. The proposed right to a full-time position has typically been rejected on the grounds that the present rules and regulations for part-time work are considered sufficient and working time is an issue for social partners rather than the Swedish government (Berglund et al. 2020). Another related issue has been the Swedish LO’s idea of introducing a guaranteed minimum number of working hours to prevent employers from utilising the so-called planing (“hyvling”) of working hours, where employers introduce short hours instead of dismissing people, and thus are able to circumvent the Swedish employment protection laws (see also chapter 3 on Sweden by Berglund et al. 2020). So far, however, Swedish employers have been allowed to continue this practice following different rulings by the Swedish labour courts in cases where unions have tested the legality of such employment practices (LO-Sverige 2019). “Hyvling” was also a topic during the recent Swedish election campaign, where especially the Social Democrats and left-wing parties supported a ban on such employment practices. So far, however, social partners have been unable to find a joint solution to the problem. In some sectors such as retail, social partners agreed to stop “hyvling” in some larger retail stores – —which was recently welcomed by the Swedish Minister of Employment (Handelsnytt 2020).
In Finland, involuntary part-time work and more recently zero-hour contracts have also triggered a range of policy initiatives. Successive Finnish governments have among others set up different tripartite consultations and working groups involving both sides of industries to review existing part-time legislation in light of the recent increase in part-time work and not least the use of zero-hour contracts (5 per cent of all employees in Finland hold zero-hour contracts in 2019, Pärnänen 2019). However, the Finnish government has been reluctant to reform the Finnish part-time legislation despite ongoing criticism from the general public, the Finnish trade union movement and left wing political parties (Ojala et al. 2020; Siren & Nurminen 2014). Since 2012, zero-hour contracts have been widely debated in Finland, and although the Finnish Ministry of Economic Affairs and Employment in 2012 commissioned a tripartite working group to map zero-hour contracts, including the risks associated with such work, the working group failed to put forward any reform proposals due to internal disagreements and conflict of interests (Siren & Nurminen 2014). Likewise, in 2014, the proposal by a Left Alliance MP to introduce a statutory minimum working time guarantee of 18 weekly working hours was also unsuccessful. The same applied to the citizen initiative (Operaatio vakiduuni) led by the Finnish trade union movement, which urged the Finnish Parliament to legally ban zero-hour contracts in 2017 (Siren & Nurminen 2014; MEAE 2018a). This initiative was initially rejected by Finnish policy makers, but has subsequently led to novel regulatory changes around the usage of zero-hour contracts (Savolainen 2017). These included the introduction of new social rights for workers with zero-hour contracts and legal limitations on the usage of such contracts (Firon 2019).
In Denmark, there have been examples of social partners developing joint and unilateral initiatives to promote and encourage full-time work among part-time workers due to the foreseen labour shortages, particularly in the health and social care sector (Larsen & Mailand 2014; KL 2020). In 2013, regional employers agreed to a policy that entails that new positions should in general be full-time positions. Part of this policy sets targets for full-time employment (64 per cent in 2015 and 80 per cent by 2021, but the policy also includes a number of exemptions that may be a barrier for reaching targets (Larsen & Mailand 2014). Likewise, in 2020, social partners in the local government sector jointly agreed to a new policy to reduce the high levels of part-time work in the government sector (40 per cent and in some local government sectors up to 90 per cent of all jobs are part-time, KL & FF 2020). Their aim was to address the foreseen labour shortages and promote gender equality. Part of this new policy is that full-time work should be considered the default employment contract with part-time as a possibility. To achieve this goal, it is encouraged that all new positions are full-time. The social partners have also initiated a series of steps, starting with mapping barriers and developing new policies and tools to promote full-time work in close collaboration with local managers, workplace representatives and individual workplaces (KL & FF 2020). Furthermore, during the 2020 collective bargaining rounds, Danish social partners within industrial cleaning specifically agreed to reduce the share of few-hour contracts, even with initial opposition to this proposal within the employers’ camp. This was brought to the bargaining table by the trade unions (SBA & 3F 2020; Elite interviews 2020).
Temporary employment is another topic that has attracted increased attention in all five Nordic countries. In Finland, the most recent debates on temporary employment have been tied to the reform to allow fixed-term contracts for unemployed people for up to one year without restrictions, while the Danish debates on temporary employment have mainly been tied to TAW and their risks of sub-standard wage and working conditions. Particularly Danish trade unions in manufacturing, construction and transport have pushed the agenda and paved the way for improving TAWs’ social rights through sector and company bargaining by expanding their collective agreements and lowering their eligibility criteria for social benefits (Larsen & Mailand 2014; Andersen 2003). Also, the Danish implementation of the EU directive on TAW triggered a longwinded debate, especially around the interpretation of the directive’s principle of non-discrimination, where social partners were unsure and disagreed on the status of white-collar workers working as temps (Larsen and Mailand, 2014:25). Other controversial issues involved how to prevent social dumping from foreign TAWs operating in Denmark along with the possibilities for exemption from the EU directive, provided the existence of a collective agreement. The compromise reached by social partners and the Danish government was to only allow such exemptions where collective agreements have been signed by the most representative social partners in a particular sector (Andersen & Karkov 2011). Although they did sign this agreement, the Danish unions were not pleased with the results as they were to be bound by some sectoral agreements on TAW that were slightly outdated and did not de facto secure non-discrimination (Larsen & Mailand 2014: 25).
The Norwegian debates on temporary employment have been closely linked to the implementation of new legal measures that relaxed the rules and regulations on fixed-term contracts (2015) by allowing fixed-term contracts of up to 12 months while introducing tighter regulations on the use of TAW (Nergaard 2020a). Norwegian unions have repeatedly opposed such regulations on the grounds that they weaken employment protection, while the Norwegian government with the support from the employers have argued that temporary employment is a stepping stone to permanent positions (Sterud 2010; see chapter 5 by Nergaard 2020a). TAW have also attracted political attention in Norway, especially following the 2004 EU enlargement. The focus of this attention has been on agency workers within Norwegian construction and manufacturing and less so on the health and care sector (see chapter 5 by Nergaard 2020a). Low unionisation rates, lack of collective agreements, substandard wage and working conditions along with ways to regulate the TAW sector have been widely debated, leading to reforms tightening the rules surrounding TAW. The recent legal ban on zero-hour contracts also has implications for the TAW sector since temporary agencies can no longer employ TAW on open-ended contracts unless they are secured predictable work and minimum pay even between assignments (Nergaard 2020a).
In Iceland, political debates on temporary employment have, like in Denmark and Norway, been tied to the inflow of migrant workers and the rights of TAW. To combat non-discrimination, the Icelandic government has passed legislation that ensures similar rights to foreign workers employed through an agency as other workers in the Icelandic labour market. The legislation also requires that employment agencies be registered in Iceland, have a local representative and provide the public authorities with information on their operations (Olafsdottir et al. 2020).
In Sweden, the debate on temporary employment has most recently been tied to the concept of stacking (“stapla”), which entails that different types of temporary employment are stacked to circumvent the law of temporary workers’ rights to an open-ended contract after 2 years of employment with the same employer. The Swedish unions have been highly critical of this employment practice and have repeatedly urged the Swedish government to change the rules. In 2016, the Swedish government subsequently restricted the use of stacking by legislating that under certain conditions, temporary contracts are automatically turned into open-ended contracts (Berglund et al. 2020).
Another related issue is the ongoing debate in Sweden regarding liberalisation of employment protection laws, especially the rules for dismissals, which was proposed by the Swedish liberal-leaning and centrist parties during the 2018 election campaign and was one of the main obstacles to overcome in the formation of the current Swedish coalition government (Gustafsson 2020). The involved parties disagreed on whether and how to liberalise the employment protection. Particularly highly controversial was the dismissal rule that follows the so-called order of priority – —the “last in, first out principle” – —which is based on how long an individual has worked for the company and which states that if two employees have a similar length of employment at the company, priority is granted to the older worker (Gustafsson 2020). The social partners were also divided on this issue, with the Swedish unions being highly critical since they saw this as pivotal for protection of older workers, while Swedish employers called for liberalising the rules to gain increased flexibility (Gustafsson 2020). The Swedish coalition government agreed to modernise the employment protection regulations, and this formed part of their government pledge. A government inquiry was commissioned to review the existing employment protection laws, but their recommendations were met with mixed reactions. The Swedish centre-right parties and employers welcomed the recommendations by the government inquiry, some of which included exemption of all companies from the “last in-first out principle” and removal of the priority of older workers in cases of dismissals. They also included introducing preferential rights to re-employment for fixed-term workers with contracts of nine months or more over a three-year period, new rights to further training as well as exempting companies with less than 15 employees from the rules in which dismissals can be declared invalid (SOU 2020:30). The Swedish trade unions, the left-wing parties and the Social Democrats, including the Swedish Prime Minister and Minister of Employment, have criticised these recommendations by the government inquiry on grounds that the proposed liberalisation of the dismissal rules shift the balance between employers, unions and employees in favour of the employers (Wilhelmson 2020; Svt Nyheter 2020). It remains to be seen if and how the Swedish employment protection laws will be revised, as negotiations unfold.
The regulations governing emerging forms of work such as distinct forms of solo self-employment and digital platform work have been widely debated in all five Nordic countries. These issues have often been tied to debates on social dumping, unfair competition, health and safety, tax evasion and foreign labour, where there have been a series of prominent cases related to subcontracted work and publically procured work (Ilsøe & Madsen 2017; Jesnes 2019; Arnholtz et al. 2018; Olafsdottir et al. 2020). In addition, the status of solo self-employed workers, especially the grey area as to whether they are to be considered as employees or self-employed has been widely debated and tested in courts in all Nordic countries (Nergaard 2020a; Ojala et al. 2020; Berglund et al. 2020). These public debates have led to a series of national initiatives and policy responses.
In all five Nordic countries, national governments and social partners have debated the status of solo self-employed workers as to whether they are to be considered as employees or self-employed (Hotvedt et al. 2020). The issue is yet to be resolved and there are examples of debates and initiatives that point in different directions. In Denmark, Norway and Sweden, a number of company agreements that regulate the wage and working conditions for platform workers has recently been successfully negotiated between trade unions and individual companies (Ilsøe 2020; Jesnes 2019; Jesnes & Oppegaard 2020). In such collective agreements, platform workers have typically acquired the status of employee, but there are also examples such as the Hilfr agreement where individual platform workers can choose their status as self-employed or employee after having worked a certain number of hours on the platform (Ilsøe, 2020). Unlike the other Nordic countries, there are also examples of collective agreements covering solo self-employed workers in Denmark, and some Danish trade unions (TL and HK) have set up freelance bureaus for solo self-employed workers as well as established occupational pension schemes for freelancers and employees without collective agreements (Larsen et al. 2018). In these examples, the status of solo-self-employed workers differs as they in the case of TL and HK’s freelance bureau acquire the status of employees, while other initiatives such as the occupational pension schemes continue to treat them as self-employed.
A number of Nordic trade unions have also increasingly started to organise solo self-employed workers (see also chapter 9). In some of the Nordic countries such as Denmark, this has sparked debates internally within some of the unions as well as between employers’ associations and unions as their status blurs the traditional employer-employee distinction (Larsen et al. 2018). The fact that some Nordic unions have also started to offer various business services in line with some employer associations have further fuelled this debate. It will be interesting to follow how this debate will evolve and not least be resolved as the traditional employer-employee divide is one of the key pillars in the Nordic collective bargaining model.
There have also been recent reforms in Denmark and Finland that ease solo self-employed workers’ access to unemployment benefits and other social protection schemes. However, there are also examples of recent regulatory changes that tighten the eligibility criteria for accruing rights to unemployment benefits, social assistance, sick pay and thus may contribute to increased risks of precariousness for solo self-employed workers and other groups of non-standard workers (Ojala et al. 2020; Kvist & Greve 2011). In 2018 and June 2020, the Swedish government appointed committees to review ways to improve the working conditions for solo self-employed workers and their usage of the social security system. The first committee reported in June 2019 and concluded that the regulatory framework was not always adjusted to the needs of solo self-employed workers in areas such as sick pay, and called for more simplified rules and regulations and further analyses of especially the emerging gig economy (Dir. 2018:54; SOU 2019:41). The second committee set up in 2020 is to further analyse and propose ways to simplify the existing rules and regulations around social protection for solo self-employed workers not least regarding their access to sick pay and paid parental leave schemes. The committee is to report by December 2021 (Dir. 2020: 71; SOU (2020: 309). Swedish employers and trade unions such as the Artists’ Association have welcomed these initiatives (Teaterförbundet 2020; Svenskt Näringsliv 2020).
The EU has historically developed a series of initiatives that aim to protect the wages and working conditions of non-standard workers. The recently adopted EU Directive on Transparent and Predictable Working Conditions (OJEU 2019, L186(105)) and the European Commission’s recurrent call for a European statutory minimum wage are examples of this. However, the EU’s labour market directives and especially the idea of a European statutory minimum wage have historically often been met with scepticism among Nordic trade unions, employers’ associations and governments – notably in Denmark and Sweden – as they sometimes interfere with the voluntaristic principles of the Nordic collective bargaining model (Dølvik 2016; Andersen 2003). The idea of a European statutory minimum wage is at odds with the Nordic legacy that wage setting is a prerogative of the social partners (de La Porte 2019; Eldring & Alsos 2012; Furåker 2020).
Both the recently adopted directive and the recently proposed minimum wage in member states form part of the EU’s pillar of social rights, though as mentioned, especially the latter has been controversial in the Nordic camp. The Directive on Transparent and Predicable Working Conditions includes a set of new social rights for non-standard workers, and it has caused both positive and critical reactions among the Nordics. The minimum wage proposal, aimed to “ensure fair minimum wages for all workers in the European Union” (Com (2020) 93570 Final), has sparked broad Nordic opposition. It includes the idea of introducing indicators to help guide the assessment of minimum wage adequacy corresponding to 60 per cent of the median wages. It also states that member states where “collective bargaining coverage is less than 70% of the workers (...) shall in addition provide for a framework of enabling conditions for collective bargaining, either by law after consultation of the social partners or by agreement with them, and shall establish an action plan to promote collective bargaining (Com(2020) 682 Final). The proposed directive further emphasises that in sectors with low collective agreement coverage, national governments in collaboration with social partners should promote the strengthening of the capacity of social partners to engage in collective bargaining (Com(2020) 682 Final). Thereby, the proposed directive, if adopted, may have important implications for many non-standard workers as they often work in low-wage sectors with low collective bargaining coverage, which tends to be lower than the EU’s proposed 70 per cent threshold (Larsen et al. 2019; Neergaard, 2020b; Kjellberg, 2020).
Nordic employers have opposed both EU proposals arguing that they compromise the voluntaristic Nordic bargaining model and disrespect the EU’s principle of subsidiarity and proportionality as well as tend to favour workers’ rights rather than business activities and competitiveness (de la Porte 2019). They also put forward this view in their joint position letter on the European Pillar of Social Rights as well as their position papers towards national consultations regarding the directive (de la Porte 2019; Ahlberg 2018). The Nordic trade unions have also strongly opposed the idea of a European system to secure a minimum wage for all workers on similar grounds as the Nordic employers, but their views on the Directive on Transparent and Predictable Working Conditions have varied (Furåker 2020; de la Porte 2019). While the Swedish trade union confederations (TCO, SACO and LO ) initially feared the latter directive would undermine the autonomy of social partners, Danish and Finnish unions welcomed this directive and called for broadening the directive to include contracts of less than 8 hours (de la Porte 2019: 12–-14; Ministry of Employment, Denmark 2018; FinUnions 2018). In fact, the Nordic unions in collaboration with the employers, Nordic governments and other national governments succeeded to some degree with their demands in that the definition of workers remains a national issue and it is possible to deviate from the directive via collective agreements (LO-Norge 2019). The Nordic unions’ joint opposition towards developing a common European system/mechanism for securing a minimum wage floor across the EU is also reflected in their joint letter to the European Commission, stating that they are unable to support the position of the European Trade Union Congress (ETUC) on introducing a European mechanism for securing a minimum wage floor. The Nordic unions found that the ETUC’s reply included too far-reaching formulations such as “member states should ensure, guarantee or be required” which suggest a need for legally binding regulation in the area and thus call on the Commission to abstain from regulating wages through legislation (Ahlberg 2020; LO-Norge 2020). Finnish trade unions were not part of this joint letter, but other statements from Finnish unions suggest that they too are highly critical towards implementing a European mechanism for minimum wage setting that will require a national statutory minimum wage (Vänttinen 2020).
The critical voices towards the proposed directive for a legally based European system of minimum wage setting have also extended to the Nordic governments, and they have on several occasions discussed how to respond to the European Commission during Spring 2020 (Furåker 2020; MEAE 2020c). In June 2020, the Swedish and Danish Ministers for Employment further sent a joint letter urging the EU to safeguard the Nordic wage bargaining model and abstain from introducing a statutory minimum wage (Ministry of Employment, Sweden 2020). Also, the Norwegian government is, in close collaboration with the social partners, discussing how to best promote the Norwegian position to prevent EU interference in Norwegian wage-setting (LO-Norge 2020). Although the current Finnish government, like their Nordic counterparts, is critical of a European system of statutory minimum wages, there are divisions among Finnish political parties. Nearly one in two of the Left Alliance and social democratic voters as well as the right-wing parties support the idea of introducing a statutory hourly minimum wage in Finland (Vänttinen 2020). Regarding the EU Directive on Transparent and Predicable Working Conditions, Finland has been quite positive and the Swedish and Danish governments have shifted from an initially critical stance to welcoming the directive following amendments in line with Nordic demands (de la Porte 2019; Ministry of Employment, Denmark 2018). The Nordic ambiguity/ambivalence concerning these EU initiatives intended to strengthen the protection of non-standard workers’ wages and working conditions illustrates the dilemmas of Nordic actors when faced with proposed legal EU regulation in areas that in the Nordic labour market models are usually regulated by collective agreements. These dilemmas become especially accentuated in instances where the proposals from the EU, often supported by European trade unions, are specifically addressing the rights of non-standard workers that often are not covered by collective agreements in the Nordic countries.
NSW is associated with increased risks of in-work poverty, income insecurity in the form of underemployment, and job insecurity in all the five Nordic countries. The institutional setting – collective agreements, labour laws and social protection schemes – that have traditionally been tailored to the interests of full-time standard employees seems to some extent to account for the lower levels of employment and social protection associated with non-standard work. The last few decades of welfare retrenchment in the Nordics, involving cutbacks in social benefits and stricter eligibility criteria, where social benefits are increasingly tied to employment status, weekly working hours and collective agreements appear to contribute to increased risks of low income and job insecurity for non-standard workers (Kvist & Greve 2011; Berglund et al. 2017). Also, the collective bargaining institutions may in some instances contribute to labour market dualisation. The Nordic collective bargaining models are weaker and often absent in areas characterised by high levels of NSW as in the creative industry and parts of the retail, hotel and restaurant, and industrial cleaning sectors. However, the very same collective institutions may in other instances contribute to delimiting the spread of certain forms of precarious NSW, especially as the Nordic social partners and governments have increasingly developed initiatives to reform their regulatory framework and tools to address the challenges related to precarious forms of non-standard work. Such examples of novel policy responses are seen in all the Nordic countries, where different problems reflecting the varying national blends of NSW have featured highest on the agendas. There are also examples of similar debates and responses to non-standard work, and these are often tied to discussions of social dumping, unfair competition, sub-standard wage and working conditions, notably among migrant workers within low-wage sectors and Nordic construction in particular. Different EU initiatives have aimed at improving the rights of non-standard workers such as the EU’s proposal for introducing a European system of minimum wage regulation and the recently adopted Directive on Transparent and Predictable Working Conditions have also sparked national debates and responses. In such instances, the dilemma arises between protection of the Nordic collective bargaining model and strengthening the legal floor of rights for non-standard workers, which has caused controversy, but also examples of Nordic success in influencing the EU proposals.
By: Anna Ilsøe & Trine P. Larsen
Internationally, we have witnessed growing debates on non-standard work such as how increases in fixed-term contracts, temporary agency work (TAW), independent workers and more precarious forms of NSW practices reinforce tendencies of labour market segmentation and dualisation (Rubery et al. 2018; Standing 2011; Kalleberg 2009). Furthermore, in the future of work debate, further proliferation and casualisation of NSW has often been considered an almost inevitable consequence of digitalisation and other megatrends that are expected to reshape the world of work in the coming years (Dølvik & Steen 2018). While NSW has received increasing attention in the media, politics and academic research in the Nordic countries as their models are built and adjusted around the notion of full-time permanent positions, limited research has compared the development in size, scope and composition of NSW across these countries in recent years (Ilsøe 2016; Berglund and Svalund 2018).
The next five chapters (3-7) present analyses of developments in NSW in Sweden, Denmark, Norway, Finland and Iceland since 2000. Our focus is on traditional forms of non-standard work, i.e. common and well-described forms of NSW that have been present in the Nordics for several years. As mentioned earlier (chapter 1 by Larsen & Ilsøe 2020a), the selected forms are part-time work (long and marginal), temporary employment (covering fixed-term contracts and TAW) and solo self-employment. We use the latest comparable statistics available without data breaks, based on data from the national Labour Force Survey (LFS) in each of the Nordic countries (see chapter 1 by Larsen & Ilsøe (2020a) for further details on the LFS)The LFS is an established and comprehensive survey, reaching a large number of citizens in all the Nordic countries each quarter of the year. The data obtained via the LFS forms the basis of much analysis of labour market developments in the Nordics as well as labour market policy. Further info: https://ec.europa.eu/eurostatmicrodata/european-union-labour-force-survey.
As concluded in the comparative analysis (chapter 1 by Larsen & Ilsøe (2020a), the overall trend in NSW in the Nordics is relative stability with nearly a third of all those employed being in NSW. The surface remains still. However, below the surface, we find important cross-country and inter-sectoral differences with some countries experiencing an overall growth (Denmark) while others have witnessed an overall decline (Norway) in non-standard work. Deeper down, stronger dynamics of change are at play. If we shift our focus to the sector level, more salient trends can be observed. In some areas, contracts without guaranteed hours and other extremely flexible forms of NSW are on the verge of becoming the “new normal” (as in parts of the hotels and restaurant sector), whereas other domains have been dominated by solo self-employed workers for years (the creative industries and agriculture, forestry and fishery).
The ambition of the country chapters is to better apprehend these particular trends across the Nordic countries. Each national research team has examined the scope and types of NSW as well as the context for these variations in detail. All chapters are structured in the following way to ease the comparison between chapters: after a short background section, we present the section analysing the overall statistics of the four traditional forms of NSW in the country. Third, we present an analysis of sector variations focusing on peaks in part-time, fixed-term contracts, temp agency work and solo self-employment. Fourth, we analyse the characteristics of workers in NSW. Fifth, we present an analysis of regulatory debates and policy responses. Finally, we deliver some methodological reflections before reaching the concluding section.
By: Tomas Berglund, Anna Hedenus, Kristina Håkansson and Tommy Isidorsson
The recent development in the traditional forms of non-standard work (NSW) in Sweden is the focal point of this chapter, where we draw on survey data from the Swedish Labour Force Survey (LFS) and desk research. The chapter analyses how NSW has developed in Sweden since 2000 and explores sector variations and worker characteristics. Key issues and debates among social partners as well as relevant policy responses are also subject to analysis in this chapter.
Non-standard work (NSW) in this project describes employment relationships that differ from the typical full-time employment on permanent (open-ended) contracts (30+ hours per week), which is slightly different from the definition commonly used in Sweden (where full-time employment is defined as open-ended contracts of 35+ hours per week). Usually, temporary contracts, part-time jobs and some forms of self-employment are included in the concept. For further elaboration on the definitions of types of NSW used in this report, see Chapter 1 by Larsen & Ilsøe (2020).
In 2015, 26 per cent of all those employed in Sweden were either part-time workers, on fixed-term contracts or solo self-employed. There has been a slight increase in marginal part-time and temporary employment since 2000, while long part-time work and solo self-employment has marginally decreased from 2000 to 2015. Most of these employment forms are still fairly marginal phenomena on the Swedish labour market, with the exception of temporary contracts. Close to 15 per cent of all in employment are temporarily employed (fig. 3.1).
We draw on data from the Swedish Labour Force Survey (LFS) (2000-2015). Over time, LFS has gone through several changes. In 2001, the sampling population changed from 16-64 years old to 15-74 years old. In 2005, a large revision took place concerning definitions and measurement to harmonise the Swedish LFS with EU LFS. In 2007, the definition of unemployment changed, now including full-time students searching for work.
Non-standard employment is most frequent within the sectors of Accommodation and Food Services; Arts, Entertainment and Recreation; and Other Services (including Household Services). Within Agriculture, Forestry and Fishery it is common to be solo self-employed, while fixed-term contracts are frequent within Administrative and Support Services. The share of NSW within distinct sectors is often somewhat higher than the national aggregated data, where temporary employment and part-time – both marginal or long –are in some sectors twice as high as the national average for the Swedish labour market. Likewise, in some sectors solo self-employment is four times higher than the national average for the Swedish labour market (fig. 3.2). When looking across time, there has been a shift in the sectors that are among the top three categories, except for Accommodation and Food Services and Other Services that continue to figure among the top three sectors (fig. 3.2).
In 2000, marginal part-time work was primarily found in the sectors of Accommodation and Food Services; Agriculture, Forestry and Fishing; and Other Services. In 2008 and 2015, this was still the case for Accommodation and Food Services and Other Services. Agriculture, Forestry and Fishing were, however, replaced as a dominant sector by Arts, Entertainment and Recreation. Between 2008 and 2015 we can also see how the sector of Arts etc. increased its share of marginal part-time workers. Turning to long part-time, Accommodation and Food Services as well as Other Services were the sectors with the highest share of such contracts. In 2000, long part-timers were common also in the Health sector. In 2008 and 2015, this sector had been replaced by Arts, entertainment and recreation as one of the three sectors with the highest share of long part-time workers.
Similarly, a large share of workers employed on temporary contracts can be found in the sector of Accommodation and Food Services (fig. 3.2). In 2000, most temporary workers were also working within the Health Care sector or with Other Services. In 2008 and 2015, it was instead the sectors of Arts, Entertainment and Recreation and Administrative and Support Services that, together with Accommodation and Food Services, employed the most people on temporary contracts. In the case of Administrative and Support Services, there was also a clear increase within this sector during the period. In addition, we can see that the share of people involuntary working on temporary contracts increased from 67 per cent in 2008 to 70 per cent in 2015. Our regression results provide us with information about the probability of temporary employment when working within various sectors. We find high risks for those working within Administrative and Support Services and Arts, Entertainment and Recreation. The odds for those working with Accommodation and Food Services to be temporarily employed, however, decreases when controlling for other variables, such as gender, age, education, etc. (Appendix).
Solo self-employed workers are primarily found within Agriculture, Forestry and Fishing (fig. 3.1). Although the share of solo self-employed workers decreased somewhat in 2015 compared to 2008, the share of solo self-employed workers in the Agriculture, Forestry and Fishing sectors is still 39 per cent. A large share of solo self-employed workers is also found in Other Services and in Arts, Entertainment and Recreation. Further analyses (Appendix), however, indicate that the probability of being solo self-employed in 2015 is rather similar between these three latter sectors, and it is the sector of Agriculture that really stands out. Between 2008 and 2015, the total share of self-employed workers did not change significantly (fig. 3.1).
Some employee groups are more likely to take up NSW. For example, groups that are more likely to work reduced hours are women; people aged 65 years or more; low-skilled workers; students; multiple job holders; individuals born outside of Europe.
Categories that according to our regression results are at higher risk of being temporarily employed are young people aged 15–17, low-skilled workers, students, people with more than one job, people born outside of Europe; and people without children living at home.
The following groups are particularly likely to be solo self-employed: men, people over the age of 65, students, people with more than one job, people born in Europe outside the Nordic countries, and people without children living at home. Reported by Eurofound (2017:10f), solo self-employment is a genuine choice for a majority (86 per cent) of the self-employed in Sweden, and these people also enjoy being their own boss (98 per cent). This study also looks at the economic and social situation for self-employed people in different European countries. Even though there are some difficulties, from a European perspective self-employed in Sweden are relatively well protected by income insurance systems and social security benefits such as paid paternal leave.
Many non-standard workers, especially part-time workers, have often voluntarily opted for working reduced hours. However, our findings also suggest that nearly one in five part-time workers – marginal as well as long part-timers – have opted for part-time work as they were unable to find full-time employment (fig. 3.3). The situation is slightly different among temporary employees where the share of employees of involuntary temporarily employed workers is much higher than the share of involuntary part-time workers: 70 per cent of temporary employees state their temporary employment is involuntarily.
Looking across time, the overall share of workers involuntarily employed in non-standard arrangements remained fairly stable from 2008 to 2015. Marginal part-time employment appears to have remained unchanged between 2008 and 2015, whereas people involuntarily working long part-time or holding a temporary contract increased slightly during the same period (fig. 3.3).
In Sweden, full-time employment is typically considered an open-ended contract with 35+ weekly working hours, which differs slightly from the definition of standard full-time employment used in this project (30+ weekly working hours, open-ended contract). The Swedish Employment Protection Act (Swedish Code of Statutes, 1982:80) prescribes that the standard employment form is an open-ended contract (called a permanent contract).
Regulation of part-time work follows general labour laws, i.e. the employment protection legislation etc. In addition, an EU directive concerning the principle of non-discrimination applies, ensuring part-time employees similar rights as comparable full-time staff, i.e. pension schemes, sick pay etc. As pointed out earlier, the term used in this project – marginal part-time work (0–14 weekly working hours) – is not commonly used in Sweden. Instead, employment with less than 19 weekly working hours is in Sweden defined as short part-time employment, for example, in official statistics.
Temporary employment exists in two different forms: fixed-term contracts and temporary agency work (TAW), where Swedish labour law allows agency workers to be either permanently employed or temporarily employed.
Fixed-term contracts are regulated in the Swedish Employment Protection Act (Swedish Code of Statutes 1982:80). This law prescribes that the normal employment form is an open-ended contract, while fixed-term contracts (tidsbegränsad anställning) is a deviation from the norm. However, the circumstances for using fixed-term contracts have been liberalised over the years. In 2007, a new law came into force which specified five types of fixed-term contracts: General Temporary Employment (GTE), substitutes, seasonal work, probationary contracts, and specific contracts for employees aged 67 and above. GTE means that an employer does not have to state any specific reason for employing temporarily, which is an important difference from previous legislation and includes several different practices of temporary employment, such as project and on-call employment. However, employees working as substitutes or on a GTE have the right to change to an open-ended contract if they have been employed on the same contract for at least two years during a five-year period (or if the GTE, substitute and seasonal work are for the same employer for at least two years during a five-year period).
Temporary work agencies are regulated by the Private Employment Agencies and Temporary Labour Act (Swedish Code of Statutes, 1993:440; 2012:854). From an international perspective, the regulation of temporary work agencies in Sweden is liberal (OECD 2013). There are no restrictions on length of the assignment or the cumulative duration of assignments when using TAW. However, Swedish legislation protects agency industry employees by explicitly emphasising that employees may not be prevented from being hired by the client organisation to which they are assigned. The Swedish Employment Protection Act also applies to TAW. The standard employment form should be an open-ended contract. Regarding temporary contracts, the collective agreement is actually stricter than the Act and limits the possibility for temporary agencies to use general temporary employment to six months (could be extended to 12 month if the union approves). Other working conditions for TAW are regulated via collective agreements in the same way as other industries. According to the collective agreement between Swedish Staffing Agencies and the 14 unions of the Swedish Trade Union Confederation, TAWs must have an hourly wage corresponding to the average hourly wage for comparable groups at the client organisation (Staffing Agreement 2017). The collective agreements also state the right to compensation payment for agency workers between assignments (about 80–90 per cent of the regular salary). Collective agreement coverage is high despite low union density rates: Local union branchesIn Sweden, workplace representation for employees is regulated along a single channel of representation, locally at the employing organisation. are rarely seen at temporary work agencies (Björkemarken 2012), and union representatives estimate that the agency industry union density is significantly lower than elsewhere in the Swedish labour market (no statistics available on union density). The latter might be explained by the fact that the agency industry in Sweden is dominated by young employees and people born outside the Western world (Joona & Wadensjö 2010).
There is a distinction in Sweden between solo entrepreneurs and solo self-employed workers (SOU 2017:24; Bjerke & Pettersson 2013). In section 3.6 we discuss the policy debates and reforms that apply to these types of work (see also chapter 9 by Hedenus & Nergaard 2020).
When debating NSW, it is important to note that the various forms of it often overlap. Working on-call is generally regulated as a temporary contract, but often also involves a contract of few working hours, i.e. marginal or short part-time work. The insecurities in each of these contract types therefore tend to reinforce one another. Keeping this in mind, the following section presents findings of some of the more recent studies, policy debates and reforms on NSW in Sweden.
For years, there has been an ongoing discussion regarding the question of involuntary part-time work, which is a problem for women in particular. In particular, the increase of on-call work with few monthly working hours has been an issue raised by Swedish unions, i.e. Kommunal (2020a) (Broughton et al. 2010: 30). The right to full-time work has been a recurrent promise in election campaigns (particularly from the political left), and there have been many parliament proposals on how to introduce a right to full-time positions for involuntary part-time workers. So far, these proposals have been rejected based on the assessment that the present law regulates the matter sufficiently and with reference to the work conducted between the social partners (e.g. Arbetsmarknadsutskottets betänkande 2016/17: AU7). A related discussion concerns the present social security system, where part-time work also negatively affects the level of sick pay, paid parental leave and pensions, and as a result, women are generally entitled to a lower levels of compensation than men.
Another issue related to part-time work concerns gender inequalities arising from parenthood, due to women being more likely than men to work reduced hours when their children are young (Anxo 2009: 65). There have been a number of legal changes aimed to improve parents’ rights to change their working hours over their lifespan. For example, in 2006, parents of children under the age of eight gained the statutory right to work reduced hours with up to 25 per cent of their normal working hours (Swedish Code of Statutes 2006:442). This reform aimed to make it easier for parents to be in long part-time work, and with the right to return to full-time employment subsequently.
One of the focal points in Swedish working hours policy and welfare policy has also been the notion of negotiated flexibility rather than an across-the-board reduction of working hours (Anxo 2009: 55). There is currently no legislation that guarantees a minimum number of hours in the work contract. However, a discussion has emerged on whether to somehow include such guarantees in employment protection legislation as a way to prevent so-called planing (“hyvling”), in which the employer, instead of firing personnel, reduces the number of working hours from full-time to part-time, in order to circumvent the employment protection legislation which only protects the employment, not the working hours. Thus, the company also gains numerical flexibility with the possibility to increase number of hours in an economic upturn. In these cases, when the employer wishes to re-negotiate the contractual terms of an employment, the new terms constitute an offer to the employee who may accept or reject the offer. If the employee rejects the offer, and the employer can provide legal grounds for a termination of the employment, e.g. shortage of work, the employee could instead be dismissed. This practice has been tried in the Swedish Labour Court, which in 2016 ruled in favour of the employers (Swedish Labour Court 2016). The Swedish Trade Union Confederation [LO] is highly critical of this practice and demands changes in the employment protection legislation so it also protects the employees from underemployment.
Since the 1980s, successive Swedish governments have liberalised the use of temporary contracts. If we compare the OECD index of the strictness of the employment protection legislation, we find few changes in the rather strict regulation of permanent contracts since the 1990s. However, the index figure for temporary contracts went down from 4.08 in 1990 to 0.81 in 2007 (Berglund et al. 2017). In 2007, General Temporary Employment (GTE) contracts were introduced, allowing employers to employ an unlimited number of employees on temporary contracts without any specific reason. This legislative change made it easier for employers to hire staff on temporary contracts, but it also implied diminishing security for temporary workers (Swedish Code of Statutes 2006:440). Employees who are employed on a GTE contract for one employer for a minimum of two years in a five-year period will gain a permanent employment contract. This legislation is semi-dispositive, entailing that the parties can restrict it or sign away this element. The legislation provoked a debate on so-called stacking (“stapla”), i.e. “stacking” different types of temporary contracts to circumvent the rule of automatic permanent contracts after two years, and after much critique mainly from the unions, the new left-wing government coming into office in 2014 adjusted the law in 2016 to restrict these possibilities (Swedish Code of Statutes 2016:248), establishing that temporary contracts under certain conditions automatically change into permanent contracts. In the 2018 election campaign, the Social Democrats suggested that the GTE should be abolished, although not by law but by social partner collective agreements. Despite some critique, there seems to be an acceptance of temporary contracts in the Swedish public debate. They are regarded as a way for young people to combine studies and work (53 per cent of the 16-24-year-old labour force had fixed-term employment contracts in 2016 (Statista 2018), and as a way for immigrants to get a foothold in the labour market.
In the 2018 election campaign in Sweden, right-wing parties proposed changes to the employment protection law to liberalise the rules for dismissal. These proposed regulatory changes particularly concerned changes in the priority rules (“turordningsreglerna”), which would increase employers’ possibility to choose who to dismiss in case of redundancies.
After the unclear result of the election and difficulties to get a new government in place, the Social Democrats and Green Party reached an agreement with the Centre Party and Liberals, the so-called January Agreement, to let the Social Democrats and Green Party to form a government with the support of the two former Alliance parties. This agreement included several conditions, among others to start a public inquiry about the Employment Protection Act with the purpose of proposing changes, in particular to increase exemptions from the order of selection in case of redundancies. The inquiry was presented in June 2020 and included several suggestions to make it easier for employers to dismiss employees, for example by letting the employer exempt five employees from the priority rule “last in, first out”. Concerning temporary contracts, the inquiry suggested a strengthening of the right to re-employment for persons on GTE, as well as a priority for vacant open-ended positions in the organisation. Moreover, the inquiry proposed stronger requirements on employers to offer skills training for employees with at least six months’ employment. This would also include many on fixed-term contracts.
TAW constitute around 1.5 per cent of all employees in the Swedish labour market (SCB 2014). According to the business interest association Bemanningsföretagen's data, the number of TAWs was more than 80,000 in 2017 (Bemanningsföretagen 2018). Although there is a general acceptance that TAW is a way for companies to gain flexibility as well as an opportunity for jobseekers, there has been a critique of the use of very expensive TAWs within the public sector including doctors, nurses etc. Swedish employers are increasingly using TAW as a buffer, that is for an indefinite period of time, in case of a downsizing in the future (Håkansson & Isidorsson 2016; see also Håkansson et al. 2013a). The institutionalisation of the industry along with the liberal regulation of agency work (see previous section on regulation) could be seen as the key explanations for the increase of employees in the industry, as well as the rise in employers’ use of agency workers.
The concepts used in Swedish is somewhat different from the English concepts. In a Swedish context, the concept of solo self-employed workers refers to solo entrepreneurs (egen företagare). By contrast, the direct translation of self-employed (egenanställda) refers to the relatively new phenomenon of employed freelancers (see chapter 9, Hedenus & Nergaard 2020).
To act as a solo entrepreneur, one must be registered for paying business tax (F-skatt). Moreover, the solo entrepreneur runs their own business and has no employees. Included in this category are also freelancers and grant recipients such as artists (Eurofound 2017).
The category of self-employed still has an unclear legal status, as it is positioned somewhere between entrepreneur/employer and employee, and this has led to many different assessments and disputes. For example, there have been cases where various unemployment insurance funds [a-kassor] and the Social Insurance Authority [Försäkringskassan] have come to contradicting conclusions (Futurion 2017:1). Furthermore, it has been argued that actors mediating services and sales, i.e. digital platforms and umbrella companies, must shoulder the role and responsibility of the employer (SOU 2017:24). In contrast to TAW who are acting on orders from their employers, the self-employed carries the responsibility to find work and to decide which tasks to accept.
Some argue that self-employment, in the meaning of being “egenanställd”, should be encouraged and facilitated as a way of (re)entering the labour market (e.g. Tillväxtverket 2012; Bjerke & Pettersson 2013). Solo self-employment has also been debated as to whether it is an alternative way for Swedish women to reconcile work and caring responsibilities during periods of childrearing. For example, analysing register and time-use data, Joona (2017) found that the presence of young children increases the likelihood of self-employment among Swedish women. Although the common explanation for this association, in many other countries, is that self-employment is chosen to balance work and family, Joona argues that an alternative explanation for Sweden is that the choice of being self-employed while the children are young is related to a strong preference among these individuals for paid work. This finding is in line with an earlier study (Anxo & Ericson 2015) arguing that a shorter duration of parental leave among self-employed women compared to female wage earners could be explained with that the first group also consists of women with high performance-related income. A wider study of gender aspects on self-employment in Sweden was conducted by Mångs (2013).
A growing body of literature has explored various aspects of NSW as well as emerging ways of organising work. Some of these studies point to difficulties in drawing a general picture of NSW due to different definitions, terms and work arrangements that cover a highly diverse labour market group. For example, in international publications temporary employment and TAW are often merged into one group of contingent workers. In Sweden, the categories of temporary employment differ between the Employment Protection Act and in the LFS. In the LFS, the following categories are defined as temporarily employed: substitutes, probationary employees, internships, summer jobs, seasonal employees, project employees, on-call workers, employed on an hourly-basis with an agreed rota for a specific period, school staff employed by the term and school year, temporary work reference week, General Temporary Employment, elected representatives and contracted soldiers. Furthermore, a study conducted by Broughton et al. (2010: 11) adds to the blurred categories of NSW as it reveals that one-fifth of all temporary contracts in Sweden are considered to consist of part-time or on-call work. On-call work is common in the sectors of accommodation and food services and health care. This study also claims that the number of employees working on an on-call basis has tripled during the period 1990-2005.
A number of studies have explored the increase in temporary staffing including both fixed-term contracts and TAW in Sweden, where for example the number of employees in the staffing industry increased rapidly in the 1990s, from a few thousand in 1994 to 42,000 in 2000. Since 2000, the staffing industry has been characterised by both ups and downs. Its sensitivity to cyclical fluctuations became particularly clear after the crisis in 2008. A sudden decrease in the number of employees in 2009 was followed by a rapid increase of 30 per cent in 2010 (SCB 2012).
Concerning temporary contracts, research by Holmlund and Storrie (2002) concludes that changes in legislation do not explain the increase since the 1990s. They find that the proportion of temporary employees falls at the beginning of a crisis and then rises. As the economy is perceived to be more uncertain, companies become more likely to minimise their risk by offering temporary contracts, and job seekers are also more willing to accept these types of contracts. In addition, studies on wage differences show somewhat lower wages among temporary workers compared to permanent employees (controlling for several factors) (Skedinger 2018; Calmfors et al. 2017). However, these differences are considerably lower than in other OECD countries. Svalund and Berglund (2017) compare Norway and Sweden regarding the risk of marginalisation in fixed-term employment (defined as having low income, risk of unemployment or being a recipient of social assistance) in the long run (five years after the measurement point). They show that these risks are considerably higher in Sweden than in Norway. Berglund et al. (2017) also study changes in the proportion of temporary contracts and find that the relationship between unemployment levels and the number of temporaries becomes weaker over time. This indicates a more permanent change in the behaviour of the employers, who seem to use temporary contracts independently of the business cycle.
Berglund et al (2017) investigate the chances for employees on temporary contracts in Sweden to move to permanent contracts. During a two-year period, nearly 40 per cent of the temporary employees have moved to permanent positions (the study covers the years 1992-2010). The study (Berglund et al. 2017) also shows that the type of temporary employment is important in terms of the chances to move to permanent employment. Those working on the most insecure types of temporary contracts (e.g. on-call) are less likely to move to permanent contracts. Importantly, the study also shows that over time, it precisely these contracts that have increased the most in frequency. In a recent study by Skedinger (2018) focused on the years 2006-2016, similar transition rates from temporary to permanent employment are found (see also Calmfors et al. 2017).
Research about TAWs’ working conditions has mainly dealt with job security, and the research on the health and safety of TAWs is more limited. It includes one international review gives attention to psycho-social problems, physical workload and accidents at work (Håkansson et al. 2013b). Work organisation and TAWs’ inclusion in the workplace has been dealt with in several doctoral theses (Olofsdotter 2008, Kantelius 2012, Svensson 2015). Formally, agency workers have the same employment protection and the same rights to representation as employees in other industries. However, empirical research has shown that agency workers in Sweden are significantly less satisfied with their job security (Håkansson et al. 2012; Håkansson & Isidorsson 2015).
Self-employment has also been the subject of some research studies in Sweden. One study investigates the development between 2000 and 2007 (Brunk & Andersson 2009). In this period there was a minor increase in the number of self-employed workers. The study reports separate figures for men and women, for the various sectors, age groups, and native Swedes and immigrants. Women constituted less than half of the self-employed workers, a large proportion of the increased numbers of self-employed workers was in the age group of 55-64, and self-employment was also more common among immigrants than among native Swedes. The majority of the self-employed were working in the sectors of Agriculture, Forest Industries and Fishing; Consulting; Retail; Construction and Other. According to OECD data (2018), the percentage of solo self-employed workers in Sweden in 2017 was 9.9 per cent. Another study points out that the number of solo self-employed workers (egenanställda) since around 2010 appears to be rapidly increasing (Futurion 2017:1; van Stel et al. 2014), following a new law in 2006 opening up for temporary contracts. According to representatives from the business, the increase was also a result of the expansion and marketing efforts from the umbrella companies. However, a caveat to this observation of rapid increase is that – since this category is still not clearly defined – different measurement methods will reach different conclusions about the size of this group (Futurion 2017:1).
The share of non-standard workers has increased in Sweden since 2000, and in 2015, around 26 per cent of all employed were NSW. We find a rising number of temporary employees and long part-time employees who are involuntary in these forms of contracts.
Focusing on sectors, the share of employees in non-standard contracts within different sectors naturally fluctuates over the years that are measured. We should therefore be careful with drawing too firm conclusions based on small changes. However, we can direct attention to those sectors that are dealing with the challenges associated with part-time work more than others: Accommodation and Food Services; Arts, Entertainment and Recreation; Health; and Other and Household Services. When it comes to solo self-employment, we also need to include the sector of Agriculture, Forestry and Fishery. For temporary employment, Administrative and Support Services play a major and increasing role.
Analysing the effect of other variables, we can see that gender and age are related in different ways to different types of NSW contracts. For example, men are more likely than women to be solo self-employed, while women are more likely to be working part-time. Some groups are, however, more likely to be in NSW: students, multiple job holders and people born outside the Nordic countries. These are all groups that generally have a difficult time gaining a foothold in the Swedish labour market. In addition, people without children living at home are more likely to be in NSW, which might seem surprising. From previous research, one could anticipate a reversed relationship, not least when it comes to part-time work. A possible explanation for this result is that all parents in Sweden are able to reduce their normal working hours while their children are under the age of eight while still holding a full-time contract. Therefore, it is only when the children get older that the worker might choose a part-time contract. Another plausible explanation is that workers with dependent children are more concerned to establish secure employment and a position at the labour market, and thus more reluctant to voluntarily work part-time.
The unclear legal status of solo self-employed workers and the broad category of temporary employment still needs attention in future research and debates.
By: Stine Rasmussen, Trine P. Larsen, Anna Ilsøe, Per Kongshøj Madsen & Emma S. Bach
In this chapter we analyse the development in traditional forms of non-standard work (NSW) from 2000 to 2015 in Denmark. Drawing on data from the Danish Labour Force Survey (LFS) and desk research, our emphasis is on the general development in NSW as well as sector variations and worker characteristics. Furthermore, we address issues of concern and debates among social partners as well as relevant policy responses.
In a Danish context, workers in non-standard work (NSW) such as part-time employment, fixed-term contracts and temp agency work are considered employees (wage earners, dependent employment). Solo self-employed workers have a different status, since they constitute small businesses or employers in the legal sense.
There is no official definition of long and marginal part-time employment within Danish labour law and collective agreements, though some social protection schemes define part-time work as less than 30 hours per week. In this report we use the definitions used by OECD and ILO, i.e. <30 hours per week (OECD 2020a; Messenger & Wallot 2015). Due to data limitations we sometimes use the term temporary employment to cover both fixed-term contracts and temporary agency work.
Long part-time: Employment with 15-29 weekly working hours.
Marginal part-time: Employment with less than 15 weekly working hours.
Fixed-term employment: Employed on a temporary or fixed-term contract rather than holding an open-ended position.
Temporary agency work (TAW): Employment in a temporary work agency where work is temporarily carried out at a user company and under the supervision and direction of the user company. The Danish definition of TAW follows the definition outlined in the EU directive on TAW.
Solo self-employed workers: Workers not enrolled in a subordinate employer relationship and without employees. Self-employed workers may have a VAT number (in Danish a CVR number), but this is only compulsory if they exceed the threshold of earning DKK 50,000 per year.
Full-time open-ended contracts with a weekly working time of 30 hours or more continue to be the dominant employment form in Denmark: 71 per cent of all employees hold this type of work contract. However, 29 per cent of all employment can be described as either fixed-term contracts, temporary agency work (TAW), marginal and long part-time contracts or solo self-employment. These numbers have remained fairly stable since 2000, when 26 per cent of all workers held one or more of such contracts. Marginal part-time work is the fastest growing employment form in the Danish labour market and also the largest subgroup of NSW examined in this report followed by long part-time work, fixed-term contracts, solo self-employment and TAW (fig. 4.1).
Due to a data break in the Danish sector variable in the LFS (Danish version of NACE) between 2007 and 2008, it is unfortunately not possible to compare the numbers from 2008 and 2015 with the data from 2000 across distinct sectors. Thus, the sector analysis includes only data from 2008 and 2015. Due to a low number of respondents, we have been unable to distinguish between temporary agency work and fixed-term workers in all analyses. We have therefore combined the groups into one category in certain cases, since they are both temporary forms of employment.
The different business needs across sectors in Denmark seem to contribute to different employment strategies by employers. In 2008 and 2015, wide cross-sector variations existed in terms of the prevalence of distinct types of NSW (fig. 4.2).
Marginal part-time work is widespread within the hotel/restaurant sector (32 per cent in 2015) and has remained fairly stable since 2008. This category of work is also common and increasing within the creative industries and retail: 30 per cent of all those employed in the creative industry worked less than 15 hours per week compared to 24 per cent in the retail sector.
Long part-time work is also common in the hotel/restaurant sector and unlike marginal part-time work, it has increased slightly in this sector (from 16 per cent in 2008 to 18 per cent in 2015). The two other sectors with the largest share of employees holding long part-time positions are the creative industry (13 per cent) and health and social care (14 per cent), but both sectors have seen a slight decrease in the number of people working long-part-time since 2008.
Temporary employment, which includes both fixed-term contracts and TAW, is also common within the creative sector where 13 per cent of all employed held such positions in 2015. Temporary employment is also widespread in the educational sector (12 per cent in 2015) and health/social care (10 per cent in 2015). The share of temporary employees has marginally declined in all three sectors since 2008.
Solo self-employment is most widespread within agriculture (21 per cent in 2015), which is explained by Danish farmers often working alone on their own farm. If we disregard the agricultural sector, solo self-employment is most common in the professionals sector (17 per cent in 2015), including activities such as accounting, management consultancy, translation, design and photography. Solo self-employment has increased in this sector since 2008 (from 14 per cent in 2008 to 17 per cent in 2015). Solo self-employment is also more prevalent within other service activities (12 per cent in 2008 and 2015), including ‘Activities of membership organisations’, ‘Repair of computers and personal and household goods’, ‘Hairdressing and other beauty treatment’ (Eurostat 2008: 88).
In sum, our findings show that specific types of NSW are more common in some sectors than others in the Danish labour market. This suggests that employers in different sectors seek distinct forms of flexibility to adjust their workforce according to production demands and changing economic cycles. For example, marginal and long-part-time employment is more common in the hotel/restaurant sector, whilst the health/social care sector is more likely to draw on a combination of fixed-term contracts and long part-time positions. The creative industry stands out as the only Danish sector with a large share of several forms of NSW, i.e. temporary employment, marginal part-time, long part-time and solo self-employment.
Studies point to the recent economic crisis that hit the Danish labour market hard in 2008-15 as an important driver for the recent development in NSW (Rasmussen et al. 2019; Larsen & Mailand 2018). With respect to the rising number of marginal part-time workers, ample research suggests that the economic recession in 2008 and different recent reforms may have been contributing factors. These reforms include, for example, the new Danish legislation that allowed for more flexible opening hours (2012) as well as the reforms of the Danish student allowances, social assistance system with its obligation that people have to work at least 225 hours per week to qualify for social assistance (Ilsøe 2016; Rasmussen et al. 2019; Mailand & Larsen 2018). However, this alone cannot explain the recent development, as the increase in part-time work started before the economic crisis hit Denmark in 2008 and the aforementioned welfare reforms were implemented.
The characteristics of those taking up NSW tend to vary across type of employment and sector. In the LFS, respondents who work either part-time or under a temporary contract were asked about their reasons for doing so, which also seemed to vary a great deal. Therefore, we were able to capture the (in)voluntary nature of these types of NSW.
Overall, women, young people and migrants (most pronounced for people born outside the EU) are overrepresented within NSW in Denmark. Thus, our results echo other research in the field (Larsen et al. 2019; AE-Rådet 2018; Kongshøj Madsen 2015).
Our results indicate that marginal part-time work is more common among students, retirees, unskilled workers, women, migrants and young people (<29 y. o.). We also find that many marginal part-time workers hold multiple jobs and their decision to work few hours is often voluntary: Less than 5 per cent state that they work few hours as they are unable to find a full-time job (fig. 4.3). Other reasons that people opt for marginal part-time work is because they are studying (true for more than two thirds). In addition, the number of people working marginal part-time hours due to illness or disability has increased from 4 per cent in 2000 to almost 7 per cent in 2015.
Long part-time employment is more common among women, disabled people, retirees and migrant workers from outside the EU or Eastern Europe. We also find that older workers (>65 y.o.) tend to work reduced hours (long part-time) just before retirement age. In addition, young people (<29 y.o.) are also more likely to work long part-time hours. Those with a primary or secondary level of education are also more likely to take up long part-time positions.
For long part-time workers, the question of whether the employment is involuntary or voluntary is somewhat different than among marginal part-time workers. The most common reason cited for working long part-time hours is “other” or “no reason” (around 50 per cent in 2015, fig. 4.4). This category includes those who have chosen to work part-time to care for children or a disabled person at home, which is interesting in light of the comparatively high Danish universal child and eldercare provision, which guarantees children full-time day care and dependent older people formal care based on needs rather than means testing. We also find that nearly one in four long part-time workers combine their part-time job with their study activities. Furthermore, 19 per cent stated that they prefer to work full-time but were unable to do so, indicating that the share of involuntary part-time employment is higher among long part-time than marginal part-time workers.
Like other forms of NSW, women are more likely to take up temporary employment than men. Young people (<29 y. o.), unskilled workers and migrants are also overrepresented among temporary workers. In addition, we find that many temporary workers hold multiple jobs and their reason for working in temporary contracts is often that they are unable to find permanent employment. Around 43 per cent stated that they struggle to find a permanent job and these figures have slightly increased since 2008 (fig. 4.5). Also notable is that 16 per cent preferred temporary employment to a permanent position, while many – 38 per cent – also combined their temporary job with study activities.
Note: Temporary employment covers both fixed-term and TAW in this analysis. Too few respondents in 2000 for "Did not want permanent job”, and no data on illness/disability for temp employment for any years.
Solo self-employment is more likely among men than women, and we also find that older workers (>65 y. o.), retirees, young people (<29 y. o.) and low skilled workers are overrepresented here. Figures are unavailable as to the reasons for taking up solo self-employment, but other studies suggest that many become solo self-employed to gain greater flexibility in their work, test entrepreneurial dreams or ease their work-life balance. However, there are also examples of people involuntarily ending up in such situations, as they are unable to find alternative employment (Larsen et al. 2018; Rasmussen et al. 2019).
In sum, the main characteristics of workers taking up NSW indicate that women, migrants, young people (<29 y. o.) and low-skilled workers are more likely to work reduced hours or hold contracts of short duration – findings that also echo other studies (Ilsøe et al. 2017; Scheuer 2017). However, our results also suggest that men and older workers (>65 y. o.) are more likely to work is solo self-employment as well as work reduced hours in the last few years before retirement age. Thus, there are small differences in worker characteristics across sectors and employment types in Denmark. Our results also suggest that involuntary NSW has marginally increased since 2000 but varies among the employment groups, is more prevalent among temporary workers, less so among long part-time workers and least common among marginal part-time workers. This may be due to many young people having a marginal part-time job while studying to top up their student allowances.
We compared the characteristics and working conditions of people in NSW with their peers in permanent full-time positions and used logistic regression analysis to test the odds of being employed in the four employment types, adding a number of control variables (gender, age, educational level, primary employment status) along with information on the number of jobs held by the person. Furthermore, we added ethnicity as a variable, due to past research indicating that migrant workers from EU15 or third country nationals are more likely to take-up NSW than native Danes.
In Denmark, a mix of labour law and collective agreements regulate wage and working conditions, which also applies for most NSW. For example, Denmark has no statutory minimum wage; wage setting is left entirely to the social partners. In parts of the Danish labour market with no collective agreement coverage, wage setting is left to the market forces. In principle, collective agreements cover only wage-earners, and throughout the 1990s and 2000s, social partners have expanded the scope of collective agreements to cover fixed-term workers, TAW and part-time employees, often following the implementation of the EU labour market directives (Andersen 2003; Larsen 2011; Rasmussen et al. 2019). In other areas of employment, Danish labour law plays a more prominent role, especially regarding health and safety, holiday entitlements, equal pay and treatment, various leave entitlements as well as implementation of EU labour market directives (Rasmussen et al. 2016; Larsen & Ilsøe 2016). Examples of Danish labour laws are the Salaried Employees Act (1938), Holiday Act (1938), Equal Treatment Act (1978, Equal Pay Act (1973), and the Maternity, Paternity and Parental Leave Act (2002). The Salaried Employees Act regulates different aspects of the employment relationship such as pensions, sick pay, leave entitlements and terms of notice, while wage regulation is exempt from the Act. The most recent figures indicate that the Act covered around 64 per cent (1.3 million) of employees in the Danish labour market in 2007 (Scheuer & Hansen 2011: 28).
Danish labour law covers mainly wage earners, but an increasing number of the labour laws and social protection schemes also apply to solo self-employed workers. Likewise, a number of collective agreements also increasingly cover solo self-employed workers like freelancers, external consultants etc. (Mailand & Larsen 2018; Ilsøe & Larsen 2020b). However, in the case of social protection schemes, ambiguities exist in the definitions of self-employment, which leave the assessment of an individual’s status as wage-earner, self-employed or freelancer to legal judgment of the individual case-workers’ situation, and these schemes thus vary depending on the piece of legislation under consideration (Mailand & Larsen 2018).
Regulation of temporary employment differs in Danish labour law and collective agreements and depends on the type of temporary arrangement and the general rules regarding for instance notice periods do not necessarily apply (Danish Chamber of Commerce & HK 2017; SBA et al. 2017; Larsen 2008). Moreover, TAWs are in principle not covered by the Danish Salaried Employees Act (1938).
NSW has attracted increased attention by Danish academics, and ample research has examined the role of social dialogue and collective bargaining in relation to the recent development of NSW across distinct sectors. They argue e.g. that collective bargaining institutions in some instances limit the spread of some forms of NSW and the associated risks of precariousness. However, the very same institutions also seem to contribute to increased labour market dualisation, i.e. eligibility criteria are often linked to past employment records and weekly working hours, thus restricting non-standard workers’ access to social protection (Larsen et al. 2019; Rasmussen et al. 2016; Kongshøj Madsen 2015; Mahmood 2018). Likewise, various welfare studies also indicate that the Danish welfare state and not least the Danish flexicurity model fail to secure social protection for some of the most flexible groups in the Danish labour market (Kongshøj Madsen 2015; Rasmussen et al. 2019; 2016; Larsen 2011; Ilsøe 2012). In addition, recent Danish labour market reforms increasingly link social benefits to employment status and collective agreements, which seem to contribute to increased risks of low income and lack of job security and social protection for marginal part-time workers, solo self-employed and temporary employees (Mailand & Larsen 2018; Kvist & Greve 2011).
Some Danish studies have mapped the wage and working conditions of non-standard workers and conclude that although the number of non-standard workers has remained fairly stable since 2000, in particular solo self-employed workers’ and temporary employees’ access to social benefits has deteriorated during this period (2000-2017) (Scheuer 2011; 2017). They seem to face greater difficulties to de facto gain access to various collectively agreed and statutory social benefits, even when they in principle are covered by existing rules and regulations (Larsen & Mailand 2018).
In fact, many Danish studies on NSW find that young people, women, migrants and unskilled workers are not only more likely to hold NSW, but they also face increased risks of low pay, job insecurity and lower levels of social protection (Arnholtz & Andersen 2016; Rasmussen et al. 2016; Ilsøe et al. 2017; Rasmussen & Madsen 2017). These studies also show that many struggle to accrue enough hours to secure a reasonable income as well as less lack a voice despite the various initiatives by the Danish government and social partners to combat precarious employment (Larsen & Mailand 2018; Holt et al. 2018; Ilsøe 2020; Rasmussen et al. 2019).
Distinct occupational groups have also been subject to increased attention within the Danish literature on NSW, including highly educated groups such as IT specialists (Hansen 2015), academics (Gleerup et al. 2018) and creative workers (Jørgensen & Ventura Campos Lima 2011; Bille 2012; Larsen et al. 2018). Other studies have explored the situation of various groups of health and social care staff (FOA 2012; Jacobsen & Rasmussen 2009), construction workers (Hansen & Hansen 2009), industrial cleaners (Refslund & Thornqvist 2016) and bank employees (Kongshøj Madsen 2015).
Thus, ample Danish research on NSW echoes much of the international literature in that the institutional characteristics of the Danish welfare and industrial relations systems on the one hand seem to cushion some of the risks often associated with NSW, while on the other hand, the very same institutions contribute to increased labour market segmentation and dualisation (Emmenegger et al. 2012; Rubery et al. 2018; Jährling et al. 2018; Keune & Pedaci 2019).
NSW first started to attract increased attention by Danish politicians, trade unions and employers’ associations at the turn of the millennium (Mailand & Larsen 2011). In fact, Danish social partners have not historically utilised their positions and strength in the labour market to improve wage and working conditions for non-standard workers (Larsen & Mailand 2018). However, in recent years, trade unions have pushed the agenda, and their approach has changed from trying to reduce such employment forms to improving the wage and working conditions of non-standard workers. Danish unions have developed a series of initiatives to combat so-called precarious employment and strengthened their approach since LO and its affiliated members launched their overarching strategy on atypical employment in 2011 (Larsen & Mailand 2018). Their most recent initiatives target e.g. digital platform workers, solo self-employed and subcontracted workers, where unions have with some success secured collective agreements for digital labour platform workers, solo self-employed and subcontracted workers (Ilsøe & Madsen 2018; Larsen et al. 2018; Ilsøe 2020; Jaehrling et al. 2018).
Danish employers have a somewhat different approach to dealing with NSW. Generally, employers have aimed to increase flexibility by relaxing the rules and regulations (DA 2013). However, Danish employers have also agreed to cover non-standard workers and secure their wage and working conditions through collective bargaining and employer-led initiatives – —often to keep politicians at arm’s length as well as to secure the viability of the Danish bargaining model (Larsen & Mailand 2018). Examples of employer-led initiatives include the certification schemes by the employer associations The Confederation of Danish Industry (DI) and The Danish Chamber of Commerce (DE) to secure that their member organisations comply with the collective agreements (Larsen & Mailand 2014).
Discussions on NSW among Danish politicians have led to recent reforms of the Danish unemployment system targeting multiple jobholders (2015; 2017), amendments of the Part-Time Employment Act (2016), rule changes regarding digital platform users (2018), implementation of EU directives on TAW (2008) and maternity leave rights for self-employed workers (2010), among other changes. However, recent welfare reforms seem to have had mixed implications for distinct groups of non-standard workers. For example, the recent reform of the unemployment benefits system (which came into force in 2018) eased access to unemployment benefits, especially for solo self-employed workers, as different types of income now contribute to individuals’ accrued rights to unemployment benefits. However, other welfare reforms such as the 2010 cuts/retrenchments in the unemployment benefit system, the 2008 changes to the student allowance system and the social assistance reform in 2015 seem to contribute to increased risks of dualisation within the Danish labour market. This is largely due to tightened eligibility criteria for social benefits, which increasingly link to the individual’s employment record and number of weekly working hours. Employees with contracts of few hours and short duration seem particularly at risk: they often struggle to accrue rights to the various social benefits and are more likely to experience shorter or longer spells of unemployment due to the nature of their employment contract (Mailand & Larsen 2018; Rasmussen et al. 2016; 2019).
As described in the introduction, we are interested in the development of NSW from 2000 to 2016. However, due to problems with the data quality in the Danish LFS in 2016, we only examine the period from 2000-2015 and for these reasons our analyses have 2015 as the latest year.
Furthermore, there are some other data breaks concerning specific variables that have implications for our analyses. We are not able to conduct a sector analysis for 2000 comparable with 2008 and 2015 due to a data break in the Danish sector codes in 2007/2008, and thus fig. 4.2 only compares 2008 with 2015. Secondly, the variable capturing TAW first exists from 2006, therefore we are not able to extract TAWs and fixed-term employees from the group of temporary employees in 2000 (fig. 4.1). Furthermore, TAWs constitute quite a small share of the respondents, which poses some uncertainties about the numbers, i.e. in fig. 4.2.
In Denmark, there are a number of alternative data sources besides the Danish LFS which are able to capture the recent development in marginal and long part-time employment as well as solo self-employment and temporary employment. These data are typically administrative register data and unlike the Danish LFS they capture all employment relations in the Danish labour market and not just primary and secondary jobs. These sources allow for instance for exploring non-standards workers’ wage levels, working hours, changes in their career paths over time, union density, their usage of social benefits and whether they hold multiple jobs. When using these data sources, the number of e.g. marginal and long part-time workers in the Danish labour market increase substantially (Ilsøe et al. 2017; AE-Rådet 2018). Different sources also exist regarding solo self-employed workers such as the Danish Company Statistics (VAT register) and Statistics Denmark´s register data (RAS). In line with the LFS data, Danish Company Statistics indicate that the number of companies without employees has increased since 2000. By contrast, the register data (RAS) imply that the share of solo self-employed workers in the workforce has declined during the same period. Regarding TAW, differences are less marked when comparing LFS, the Danish Company Statistics, RAS and e-income data. All data seems to agree that the share of TAWs is around 1 per cent of the Danish workforce. Thus, the scope and level of NSW seem to vary depending on the type of data used, at least in a Danish context. While other types of NSW such as TAW, part-time employment and solo self-employment can often be analysed using Danish register data, fixed-term contracts are only measured via the LFS as this form of NSW is not systematically registered in the Danish register data.
Furthermore, some employment forms with short hours tend to be highly underreported. In Denmark, this is especially the case for on-call workers and zero-hour contracts, groups that seem to be fast growing in recent years (Rasmussen et al. 2019; chapter 8 by Bach et al. 2020). However, due to data sources mainly reporting standard employment (full-time open-ended contracts), the usually valid data sources fail to describe the scope of these short-term and short-hour employment forms. Qualitative studies, however, indicate that a considerable part of the part-time employees are hired on zero-hour contracts, i.e. the hotel case in this report where around half of the employees hold zero-hour contracts (see chapter 8 by Bach et al. 2020). Other examples include public welfare institutions using on-call workers to a large degree, i.e. the eldercare cases in this report (see chapter 10 by Hedenus et al. 2020) and other recent studies on temporary workers including on-call temps in the Danish local government sector (Larsen 2008; Holt et al. 2018).
Nearly one in three workers in the Danish labour market can be classified as non-standard, and among these, most work reduced hours (20 per cent of all employed work part-time). Marginal part-time work has become more widespread since 2000 and is often considered more precarious than long part-time work, as these workers on average have lower wages and less beneficial working conditions. Temporary employment is the second most widespread form of NSW (around 7 per cent of all employed in 2015), and the share has remained fairly stable since 2008. Solo self-employment was found among 5 per cent of workers in 2015.
Part-time and temporary work is more predominant in private and public services than elsewhere (hotels/restaurants, creative industry, retail and health/social care). Agriculture has a higher share of solo self-employment than the average, while temporary employment is most common in education, the creative industry and the health/social care sector.
When looking at worker characteristics, those entering the labour market (migrants and young people) or leaving the labour market (older workers) are overrepresented among non-standard workers along with women and low-skilled workers.
Collective agreements dominate the regulation of the Danish labour market, although labour laws regulate most working conditions, with the exception of wages. However, most collective agreements tend to offer more generous social rights than the legislation.
This is an important context when analysing the effects of regulating wages and working conditions on non-standard workers as many of them are not union members and are often working in areas of the labour market without collective agreement coverage.
Since the new millennium, the social partners in Denmark – especially trade unions – have increasingly turned their attention to the issues of non-standard work. Social partners have in some instances succeeded in striking collective agreements that have lifted wages and working conditions for some non-standard workers. However, it can also be argued that the skewed coverage of collective agreements and the tailoring of many collective agreements to the needs of full-time standard workers have contributed to dualisation of the labour market. Drivers for NSW can be found both on the employer side (needs of flexibility to match labour and demand) and the employee side as many students, women, and upcoming retirees actively seek to work fewer hours or shorter contracts. The type of NSW most used, however, varies from sector to sector.
One limitation for the study of NSW in Denmark is that most data sources are designed around standard work. Thus, the available data sources may underestimate tendencies of change within non-standard work. This has potential consequences for decision makers, social partners and scientific research. In a Danish context, one specific challenge is data on short hours, e.g. zero-hour contracts. The salaried employee act (>8 hours a week) and many collective agreements only address employees with a minimum threshold of hours in their contract. Register data mostly cover full-time open-ended contracts and VAT-registered businesses. Thus, future research should address the hidden numbers of short hours and especially employees in very small enterprises (<10 employees).
By: Kristine Nergaard
This chapter gives a brief overview of non-standard forms of work in Norway using data from the Norwegian Labour Force Survey (LFS). Non-standard work (NSW) usually refers to temporary employment (fixed-term contracts), temporary agency workers (TAW), some types of part-time work and some types of self-employment including freelancers. Here we discuss fixed-term contracts, marginal part-time work, long part-time work, solo self-employment and TAW.
The definitions of NSW forms used in this chapter are specified in the following points. For further elaboration on the definitions on NSW types used in this report, see Chapter 1 by Larsen & Ilsøe (2020).
In Norway, the majority of employed people work in open-ended, full-time employment. In 2015, 29 per cent of all employed people worked in NSW, either in part-time work (1-29 hours per week), on fixed-term contracts or as solo self-employed workers (fig. 5.1). In 2000, the share of NSW was 30 per cent, indicating that NSW in Norway has remained stable. The main change is a decline in long part-time work and a slight increase in marginal part-time work (fig. 5.1).
The share of marginal part-time work (0–14 hours per week) has increased gradually but moderately in Norway over time, from 7 per cent in 2000 to 8 per cent in 2008 and 2015 (fig. 5.1). In addition, the share of long part-time work (15–29 hours in the main job) has decreased slightly since the turn of the millennium – 14 per cent in 2000 to 12 per cent in 2015.
The share of temporary employees (fixed term contracts) has been relatively stable over time: 8 per cent in 2000, 7.6 per cent in 2008 and 7.7 per cent in 2015. Additional studies show similar stability in the share of fixed term contracts (temporary employed) in total and by sector (Nergaard 2016; Nergaard 2018).
We are unable to provide estimates on the share of TAWs in Norway due to methodological reasons; these are specified in section 5.6 and 5.7. However, other studies show that there has been a substantial increase in TAW since 2005/2006. An estimate is that 1.5–2 per cent of the employees were working as agency workers per 2017 and the share of agency workers more than doubled from 2003 to 2017 (Nergaard 2018); see section 5.6. This can be linked partly to the enlargement of the EU (Friberg et al. 2012; Nergaard et al. 2011). In 2017, 55 per cent of employees in temporary employment agency activities (NACE 78.2 in Eurostat 2008, p. 278) were migrants. Whereas the number of agency workers from other Nordic countries has decreased over time, the share of employees from East-European EU-countries has increased (Nergaard 2018). Much of the increase from 2009 and onwards can be linked to the construction sector, where it is estimated that 6–8 per cent of man-years (full-time work equivalent) are performed by agency workers (Nergaard 2018). Survey studies show that employers in manufacturing and construction often use agency workers due to labour shortage, whereas in the public sector, the most common reason for using agency workers is the need for temporary substitutes (Nesheim 2017; Nergaard 2018).
The share of solo self-employed workers has also remained fairly stable at 5 per cent across all three years (fig. 5.1).
In 2015, non-standard contracts were most frequently used within Agriculture, Forestry and Fishing; Arts, Entertainment and Recreation, Education and in Accommodation and Food Services (fig. 5.2). However, the type of NSW varied across sectors.
Figure 5.2 Sectors with highest share of types of NSW, 2000-2015
Source: Authors’ own calculations based on the Norwegian LFS.
In 2015, marginal part-time work was most common in Arts, Entertainment and Recreation, where 28 per cent of workers had less than 15 weekly working hours. Other sectors with high shares of marginal part-time work were Retail (17 per cent) and Accommodation and Food Services (20 per cent) (fig. 5.2).
Meanwhile, long part-time work was most common in Health and Social Work (23 per cent) and in Accommodation and Food Services (20 per cent) (fig. 5.2). Other sectors with a high share of long part-time work were Education (19 per cent in 2000), Wholesale and Retail Trade (16 per cent in 2008) and Arts, Entertainment and Recreation (16 per cent in 2015; no figures included for the other years due to changes from SN2002 till SN2007 from 2009 onwards).
Fixed-term contracts are most commonly used in sectors such as Accommodation and food services (15 per cent in 2000, 12 per cent in 2015), Education (13 per cent in 2000 and 2008) and Health and social work (8 per cent in all years). Logistic binary regressions show that there are substantial sector differences in the probability for having a fixed-term contract (Appendix), where working in Health and social work, Education or Public administration increases the risk for temporary employment.
The sector with the highest share of solo self-employed is Agriculture, forestry and fishery (49 per cent in 2000, 42 per cent in 2008 and 37 per cent in 2015). Other sectors with a high share of solo self-employed is the category of Other Services and Construction and Arts, Entertainment and Recreation (fig. 5.2).
The characteristics of non-standard workers varies across the different types of non-standard work. We have studied the probability of NSW using logistic regression analyses where we control for age, gender, education, and multiple jobholding.
Overall, young age, women and lower educational levels are strong predictors of NSW, especially for part-time and temporary employment.
Solo self-employed workers deviate from the other types of NSW by being most common among the oldest age groups, and not among the younger age groups (Appendix). In addition, having more than one job and having lower educational levels (usually primary) increases the likelihood of being solo self-employed.
Looking at the development in marginal part-time work, the increase can be linked to more students combining school/studies with a part-time job. Young age and having more than one job substantially increase the probability of working marginal part-time hours. Employed people with higher education are less likely to hold contracts of few hours compared to other educational groups, i.e. primary and secondary level (Appendix). Women are also more likely to work part-time (both marginal and long part-time). For long part-time work, the probability increases for young (15–17-year-old) and older (65+-year-old) workers, along with multiple jobholders (Appendix). Involuntary part-time (i.e. the number of part-time employees who want longer hours) decreased since 2000 to 16 per cent in 2015 for both marginal (25 per cent in 2000) and long part-time (22 per cent in 2000) (fig. 5.3). A study on involuntary part-time work (Kjeldstad & Nymoen 2012) shows that this is mainly tied to characteristics of the job such as type of contract, occupation, industry etc. Nevertheless, being female increases the risk for involuntary part-time work.
Among temporarily employed, young workers (<30 y. o. and especially 15–17 y. o.) are overrepresented. Educational attainment plays a role, where employees with primary education are more likely to hold fixed-term contracts compared to other educational groups. Workers who are not primarily in employment (for instance students with an extra job) have a much higher probability of being in temporary employment (Appendix). The share of involuntary temporary workers, who prefer permanent employment, has increased from 50 per cent in 2000 to 67 per cent in 2015 (fig. 5.3).
Note: Data for involuntary fixed-term contracts are based on annual average in 2009 and 2015 and for 2Q interviews in 2001. Only access to data for fixed-term in 2001 and 2009, part-time for 2000 and 2008.
In public statistics, the term underemployed is used (part-time workers who want to work longer hours, have tried to achieve this and are ready to start within two months). We only use the first of these criteria in our definition of involuntary part-time (thus, our definition does not require that the part-time worker want to increase his/her hours to full-time jobs). Regarding involuntary fixed-term workers, this is based on a question to employees on fixed-term contracts as to whether they would prefer a permanent job.
In Norwegian legislation, open-ended contracts (fast ansettelse) are to be the norm, but temporary employment / fixed-term contracts can be used in certain situations. In 2015, the Norwegian Parliament passed new and highly controversial regulations on fixed-term contracts; the Working Environment Act (Arbeidsmiljøloven, AML) was reformed and allowed for fixed-term contracts for up to 12 months (AML § 14–9 (1) f) (Arbeids- og sosialdepartementet 2018). This type of fixed-term contract does not need to be justified by a temporary need for the employee in question. A number of other regulatory changes (quotas, waiting periods (karenstid) and an upper limit for fixed-term employment) were included to avoid misuse of the law.
Temporary work agencies are covered by the same legislation as other industries, which means that permanent (open-ended) employment is the main rule. The most common contract in the TWA sector used to be “permanent employment without any guaranteed wage between assignments” (Nergaard et al. 2011). There are different views on whether this type of contract fulfils requirements for permanent employment (Steen 2013; Melsom 2017). This was one reason that new regulations on permanent contracts were introduced from 1 January 2019. According to these regulations, the employer must include an expected number of working hours in the contract. Today, TAWs can only be used in situations where the client/user company can employ someone on a fixed term basis (AML § 14–9 (2) a–e). Although there is no statistical data on the effect of the new legislation on the type of contract, we know that new types of contracts are introduced in important parts of the TWS sectorFor the construction industry, Fellesforbundet and NHO Service og Handel have agreed on a new contract (NRK June 25th 2019 https://www.nrk.no/norge/10.000-i-bemanningsbransjen-far-nye-kontrakter-etter- _historisk-milepael_-1.14601559). . It is also possible to agree on a different practice by entering an agreement with the local shop steward. From 1 January 2019, such agreements can only be entered by unions that represent at least 10,000 employees (i.e. fagforening med innstillingsrett etter arbeidstvistloven AML § 14–12 (2)) and only if the undertaking is bound by a collective agreement with this union.
The distinction between employees and self-employed workers is – if disputed or unclear – made by looking at different elements of the employment (Ot.prp. nr.49 (2004-2005: p. 73 lists seven criteria that indicate an employment form). Self-employed people will usually organise their business as a sole proprietorship (enkeltpersonforetak (ENK)). The concept of self-employed workers without a business (called “egenanställd” in Swedish; see chapter 9 by Hedenus & Nergaard 2020) is mainly unknown in Norway although a few Swedish companies engaging this type of self-employment are trying to establish themselves in Norway.
Regulations on fixed-term contacts have been high on the agenda in Norway in recent years. The arguments in favour of relaxing the rules regulating the usage of fixed-term contracts were mainly grounded in lowering the threshold for labour market entry, especially for groups with a weak position in the labour market. The counterargument – for instance from the trade union side – was that this would increase labour market insecurity. A recent study (Strøm et al. 2018) evaluating the effects of the 2015 change in legislation discusses the ambition of the regulation (to ease labour market access for groups with a weak labour market position) and found (per 2016) that the reform did not produce more jobs, but resulted in more insecure jobs.
Temporary work agencies/agency workers have also been high on the Norwegian labour market agenda since the 2000 liberalisation of the monopoly held by public job centres to provide employment services, and in particular since the 2004 EU enlargement. Focus has mainly been on agency workers in the construction sector and parts of the manufacturing sector (Ødegård & Berge 2010; Ødegård et al. 2012), although the use of agency workers in the health and care sector has also attracted some attention (Berge et al. 2011; Skjælaaen 2010). The public debates have focused partly on the situation for the agency workers (many of whom are migrant workers) and partly on the effects on sectors and workplaces. A number of issues have been discussed: wages and working time, health and safety issues, low wage competition/social dumping, effects on recruitment and training/ apprenticeships in sectors such as building and construction etc. Among the questions discussed are how the temporary work agency sectors should be regulated and how to find effective means to control the sector and the user companies. From 1 January 2019, a change in the Working Environment Act took effect which influenced temporary employment, particularly the temporary work agency sector (see previous paragraph). According to the new regulations, permanent employment is not only open-ended (without time limit), but it also requires agreement on the actual scope of work, to ensure predictability of work for the employee”Arbeidstaker skal ansettes fast. Med fast ansettelse menes i denne lov at ansettelsen er løpende og tidsubegrenset, at lovens regler om opphør av arbeidsforhold gjelder, og at arbeidstaker sikres forutsigbarhet for arbeid i form av et reelt stillingsomfang.” AML§ 14-9. (1).. The implication is that the contracts used in the temporary work agency sector (“permanent employment without wage between assignments”) will not be regarded as permanent employment and that the sector will have to offer their employees a more predictable employment agreement (AML§ 14-9. (1)).
Recent debates on part-time regulation has partly focused on legislative measures to fight involuntary part-time work and partly on how to organise work in a way that allows for more full-time positions. Two important regulations address involuntary part-time work. From 1 January 2006, part-time employees were given a preferential right to extended working time. From 1 January 2015, part-time workers were given an entitlement to an employment contract equivalent to their actual working hours over the last twelve-month period. This contract is subject to certain conditions, i.e. the employee must have the relevant qualifications. If the employee and the employer disagree, the case will be solved by the Dispute Resolution Board.
There has not been any change in regulations regarding solo self-employment as such, although there are relevant court cases drawing the line between employees and self-employed workers (see Hotvedt 2019 for relevant examples). Some issues were also discussed as part of the Sharing Economy Commission (NOU 2017:4), e.g. the distinction between employees and self-employed workers and the consequences of the emerging platform economy. A majority argued in favour of keeping the existing regulations, although they also emphasised the need to follow developments in the labour market closely. A minority wanted stricter regulations in order to secure more people the status of being an employee. However, so far it seems that there are no plans to change the current definition of “employee”, meaning that borderline cases will have to be decided case by case. In 2019 a new public commission (Future of Work Commission) was set down and will among others discuss issues related to the distinction between employees and self-employed workers. This commission, which consists of representatives from the social partners as well as labour market/labour law experts, will present their recommendations in 2021.
The debate on self-employment (not necessarily without employees) in recent years has to a large degree focused on social rights and what is seen as discrimination against self-employed people. Certain types of solo self-employed workers might be in a vulnerable situation, mainly because they are dependent on one customer/client, one platform (Alsos et al. 2017b) and/or in bogus self-employment (Samfunnsviterne & Tankesmien Agenda 2016). Organisations that represent self-employed workers have pointed to differences in social security arrangements between self-employed workers and employees and argued in favour of closing the gap, i.e. regarding sick pay and pension rights. Discussions have focused on how to encourage innovation by making it less risky to be an entrepreneur (Grünfeld et al. 2016). Few studies directly address solo self-employed workers in vulnerable positions, although reports on the platform economy (Alsos et al. 2017b) cover the issue.
Norway has a high part-time employment rate among women combined with high female labour market participation, and part-time work has also traditionally been discussed from a gender equality perspective in Norway (Ellingsæter 1989). Although it is recognised that part-time jobs have been important for a high female employment rate, it is argued that part-time work puts women in a more vulnerable position when it comes to economic independence. Women’s family responsibilities (including lack of available childcare) are often referred to as explanations for the high part-time rates (see for example BLD 2006). The main debates have been on how to further increase full-time work in female-dominated sectors, and in particular how to reduce involuntary part-time work. Much of the discussion has focused on the female-dominated health and social care sector, as this sector faces a challenge in labour shortage in the years to come. Despite this, full-time work has increased among women over time, including among women with children. In a longer perspective, improved childcare arrangements are seen as an important measure (Ellingsæter & Jensen 2019).
In addition, involuntary part-time work is discussed in relation to private service sectors such as retail and the hospitality sector. From an employer perspective, the different short-hour jobs, i.e. marginal part-time work, on-call workers etc., are a means to flexibility. It is argued that certain working arrangements such as shift work in the health and social work sectorIn the health and social care sector, for instance, rota arrangements with more weekends or long shift arrangements, although the trade unions and employer organisations often disagree on these particular issues. (NOU 2008; Moland 2013; Moland 2015; Ingstad 2016), long opening hours in retail or variable need for manpower (Nergaard 2012) are solved by using on-call workers or having employees in marginal part-time jobs, who can be asked to work when needed. Longer opening hours in the retail or hospitality sectors may therefore lead to more part-time jobs, especially as these sectors recruit students who are interested in part-time jobs.
Another issue has been the employment stability among fixed-term employees. Stability is highest among permanent employees, whereas unemployed are more at risk compared to employees with fixed-term contractsUsing LFS data combined with register data, the researchers analyse transfers in the labour market by comparing employees in fixed-term contracts with permanent employees and the unemployed. (Svalund & Nielsen 2017). Moreover, the type of fixed-term contract also influences the risk of an unstable labour market affiliation. Svalund and Berglund (2017) analyse transitions out of fixed-term contracts in a long-term perspective, comparing Norway and Sweden. The results support the stepping stone hypothesis, but also that fixed-term workers are at a greater risk of being trapped in a vicious circle of fixed-term contracts and unemployment in Sweden compared to Norway.
In this section, we present alternative studies and research on the distinct forms of NSW. However, there is not much information on fixed-term contracts in the registers, and research on solo self-employed workers as NSW is scarce; therefore, we present qualitative study insights when necessary.
It is important to note that several of the studies report on multiple or overlapping employment forms. For example, estimation of the share of on-call work (jobs without any agreed working hours, often referred to as zero-hour contracts) poses some challenges, as these are often classified as part-time employees and not as a distinct employment form. For instance, a study by Nergaard et al. (2015) shows that there is an overlap between being an on-call worker and working contracts with few hours (short part-time work). Part-time workers are often asked to work extra hours, whereas on-call workers typically have a certain predictability for when and how often they are called in. Employers often prefer to give extra hours to their part-time workers, although new studies also show that extra hours may be seen as a problem because employees might be granted longer hours based on actual working time (Alsos et al. 2017a).
Statistics-based employee registers are an alternative data source for studying the number of employees in temporary work agency activities (NACE sector 78.2). These figures also include administrative positions in the agencies as well as companies that are not traditionally regarded as temp agencies. Nergaard (2018) estimates that between 1.5 and 2.0 per cent of work hours in Norway (by employees) are worked by agency workers (see Nergaard 2018, p. 102, box for the preconditions behind the calculations), and that 1.2 per cent of the employees were working as agency workers per 2016/2017 (Nergaard 2018: 77-78). Around 50 per cent of the agency workers state that they have a fixed-term contract. The employer organisation NHO Service og Handel organises around 80 per cent of the temporary agency companies in Norway (measured by turnover/employment), and their member companies report on how many hours they bill each year (fig. 5.4).
In addition, Ellingsen et al. (2016) discusses different categories of agency workers, based on a survey among these employees. The categories are based on how long the agency workers have been in the sector, how long they have been working for the client, whether working as an agency worker is voluntary or not and why they chose this type of employer. Nergaard et al. (2011) have analysed the agency sector from different perspectives in a study of the temporary work sector in Norway, including the role of establishments using TAWs.
Media reports and court cases are currently the best source for data on false/bogus self-employment. This is partly due to the fact that a distinction between solo self-employed workers and freelancers (who receive a salary or other remuneration for completed work or assignments, but who are not employees, i.e. “ikke-ansatt lønnstaker”) is difficult (Næsheim & Johansen 2018), and we do not know how freelancers (without a sole proprietorship) will classify themselves in the LFS interview. However, a study by Nergaard (2018) finds that 7.5 per cent of the employed people as of 2016 report having worked as a contractor/freelancer sometime in the last 12 months. In addition, a study by SSB (Næsheim & Johansen 2018) estimates that freelancers (i.e. employees without an employer) account for 30,000 to 50,000 people per month, of whom many are politicians, people in certain types of care work (e.g. weekend homes) etc. Moreover, some studies provide estimates on the number of workers in the platform (sharing) economy (Alsos et al. 2017b), and recent studies on self-employment (Grimsby 2016; Proba 2016; Grünfeld et al. 2016) have to a large degree been concerned with how self-employed workers diverge from employees when it comes to social security rights etc. Both Grünfeld et al. (2016) and Nergaard (2018) have also looked at other aspects of the employment, for instance working hours and how self-employed evaluate their working situation.
However, some alternative data sources could be used as a novel measuring method for self-employed workers:
Data based on information from tax information (tax return schemes) give information on people with income from self-employment as well as the number of people who have self-employment as their main source of income (table 5.1).
|People with income from self-employment (næring)||335,899||330,540||321,509|
|People with main income from self-employment (næring)||137,255||126,336||119,047|
In 2018, income statistics reported 322,000 self-employed people,Defined as a person who conducts business at their own account and risk and is required to document entrepreneurial income as an addition to the tax return form (Statistics Norway: Income, self-employed). of whom 96,000 had self-employment as their main source of incomeType of main income indicates what type of income provides the biggest contribution to the self-employed person's total income. The type of main income is not influenced by the working hours of the self-employed person or wage earner. If the largest portion of a self-employed person's income is received from wages and pensions, his/her type of main income is wages and pensions (Statistics Norway 2019: Income, self-employed). (table 5.1). The implication is that a number of people combine income from self-employment and other activities (transfers from the state and/or income from employment). We have no information on whether self-employed people (defined by income data) have employees or not.
The other type of statistics on the number of self-employed workers is the estimates made by Statistics Norway (Statistics Norway 2020b: Employment, register-based). In 2019, the number of employed people was 2,700,492 and the number of employees was 2,562,493 (persons are classifieds by main activity). Although Statistics Norway do not produce figures for self-employed workers, the difference between employed people and employees was 137,999 people in 2019. Thus, these data suggest that the number of self-employed people is a bit higher in the LFS compared to employment data from registers.
In several reports from a project funded by the Ministry of Labour and Social Affairs, researchers analyse aspects of temporary employment (fixed-term contracts and agency workers) and self-employment. The research explores a) the share of these employment types, b) the characteristics of employed people, jobs and work places (Nergaard 2016; Nergaard 2017a; Nergaard 2017b; Nergaard 2018) and c) the reasons management state for using different types of contracts (Nesheim 2017).
LFS data is probably the best source for researching NSW in Norway with the exemption of TAW. Although some questions regarding TAW are included in the LFS, these are used for other statistical purposes and Statistics Norway does not publish any figures on the share of agency workers.
Most employment statistics are based on main jobs. However, some people have a second job and these jobs are more often in NSW. Some people have a second job as self-employed, i.e. a start-up business or running a small business on the side of their main job. Secondary jobs are identified in the LFS and including these will increase the share of solo self-employed workers by around two percentage points. However, if this type of work is more random (not on a weekly basis, which is the frequency reported in the LFS), secondary jobs might be underreported in the LFS.
In 2015, the share of NSW was 29 per cent, which is not much of a change from 2000 (30 per cent). Although the overall share of NSW in Norway remains stable, a few changes have happened under the surface: While the share of long part-time work decreased, marginal part-time work increased slightly. The share of fixed-term contracts and solo self-employment was fairly stable from 2000 to 2015. TAW increased, although more in some sectors than others. There were no substantial changes in solo self-employment (self-employed without employees) and sectors with a high share of self-employment remain stable.
Part-time work, and especially involuntary part-time work, is seen as an obstacle to gender equality and a challenge to overcome, especially in the health and social work sector which has a high occurrence of this. A number of measures have been implemented to fight involuntary part-time work, including a preferential right to an extended post (2006) and an entitlement to a post equivalent to the actual working hours over the last twelve-month period (2015).
Novel types of employment contracts – perhaps in the grey area between employees and self-employed workers – may become more salient due to the platform economy and new ways of organising businesses and services. Finding ways to integrate more people into the labour market will be important in the years to come, including discussions about whether NSW contracts are a “bridge” or a “trap” for people with a weak labour market position.
By: Satu Ojala, Tiina Saari, Paul Jonker-HoffrénPaul Jonker-Hoffrén’s contribution to chapter 6 was made possible by a post-doctoral research grant from the Academy of Finland (decision #307925), Pasi Pyöriä & Jouko Nätti.
This chapter explores the recent development in non-standard work (NSW) in Finland, using data from the Finnish Labour Force Survey (LFS) and desk research. Our focal point is how NSW overall has developed in the Finnish labour market since 2000, where we also examine distinct forms of NSW such as part-time work, solo self-employment, temporary employment and agency work. In our analysis we also explore sector variations and worker characteristics. We briefly examine key issues and recent policy debates along with recent policy responses.
In Finland, NSW made up 31 per cent of all employment as of 2015. The total amount of NSW has remained fairly stable in recent years, whereas certain forms of NSW have become more widespread since 2000 (fig. 6.1).
Part-time work (<30 weekly hours) has increased steadily since the turn of the millennium and constituted 14 per cent of all employed aged 15–74 years in 2015. The share of marginal part-time work increased from 3 per cent to 5 per cent, while the share of long part-time work increased from 7 per cent to 9 per cent (fig. 6.1).
The share of temporary employment has remained fairly stable at a high level since 2000. The share of fixed-term contracts slightly decreased from 14 per cent of all employed in 2000 to 13 per cent in 2015. The share of agency workers marginally increased in the same period: In 2009, 1 per cent of all employed aged 15–74 worked as agency workers compared to 1.3 per cent in 2015 (there is no comparable data on agency workers for 2000). Although the share of fixed-term contracts has remained fairly stable since 2000 (fig. 6.1), there was a slight increase of 0.5 percentage points from 2009 to 2015, which might reflect the sluggish recovery from the economic crisis of 2008. The number of temporary staffing firms has also increased, creating a new supply of flexible labour, especially for the service sector, and providing entry-level jobs for students and recent graduates. After 2015, the share of agency workers has increased to the level of two per cent among all employed (Statistics Finland 2020a).
Although there has been much debate on solo self-employment in Finland (see debates section in this chapter), the LFS data suggest a fairly stable development in the share of solo self-employed workers. In 2009, the share was 9 per cent, which increased slightly to 9.6 per cent in 2015 (fig. 6.1) (there is no comparable data on solo self-employment for 2000).
In Finland, NSW is most frequent within the sectors of Arts, Entertainment and Recreation; Accommodation and Food Services; Education and Agriculture, Forestry and Fishing, where employers often rely on this form of employment (fig. 6.2).
Marginal part-time work was most commonly used in Arts, Entertainment and Recreation in 2000, 2008 and 2015. Marginal part-time work was also found in Accommodation and Food Services as well as in the category Other Services (based on Standard Industrial Classification in 2008, including the category of Other Service Activities, e.g. personal service activities, and Activities of Households as Employers). The sectors with the highest incidence of long part-time work vary over time: the education sector had the largest share in 2000 and 2009, but in 2015, long part-time work was most commonly used in the hotel and restaurant sector, accounting for 17 per cent of all jobs (fig. 6.2).
The sectors with highest shares of temporary employment have more or less remained the same since 2000, and include the Education and Health Care sector, while Arts and Entertainment has been replaced by Other Services as one of the three sectors that most frequently use temporary employment. One in four of all employed in the Education sector held temporary contracts in 2015, and one in five in Health care and in Other Services.
Solo self-employed workers accounted for more than half of all jobs within the Agriculture, Forestry and Fishing sector in 2015. Solo self-employment was also widespread in the Arts and Entertainment sector (20 per cent) and Other Services sector (21 per cent) in 2009, and these numbers have remained fairly stable over the years. There was a slight increase in the Arts and Entertainment sector to 21 per cent, and Other Services sector to 23 per cent in 2015 (fig. 6.2).
Characteristics of the people in NSW tend to vary across the types of such work. For example, women are overrepresented in part-time and temporary work, whereas men are more likely to be solo self-employed. People aged 65+ typically work part-time or are solo self-employed, whereas young people aged 18–29 years often take up temporary employment or marginal part-time work. Old-age pensioners are greatly overrepresented in both agency and temporary work (more so than students).
The high incidence of part-time work among the youngest (18–29 years) and oldest (65+ years) employed persons may be due to two factors: the ageing of the population and the growing number of students in vocational and higher education. In addition, women (men used as reference group), foreign-born people, multiple jobholders and people with lower skills tend to be overrepresented among both marginal and long part-time employed workers. Furthermore, most people choose voluntarily to take up part-time work, which seems to resonate with their life situation – i.e. studying or being close to retirement age (fig. 6.3).
Among agency workers and fixed-term workers, women, young people and foreign-born people are overrepresented. Older people including retirees also tend to be overrepresented in temporary jobs. This suggests that many older people who have retired from or been made redundant in their original job may opt for smaller agency jobs and temporary positions. In addition, temporary employment is rarely a voluntary decision: around two thirds of those working in temporary positions were unable to find permanent work (fig. 6.3).
Based on the authors’ own calculations, agricultural workers, men, students, young people (18–29 years) and older workers (65+ years) are overrepresented among solo self-employed workers. Immigrants and those who already consider themselves retired are underrepresented. Solo self-employed workers are more likely to hold multiple jobs. According to Statistics Finland’s definition, own-account workers/practitioners of trade (e.g. lawyers, dentists, hair-dressers, construction workers), freelancers and grant recipients are considered as self-employed workers, even if there are some differences in their legal classification. As a group, these self-employed workers without employees make up the most rapidly increasing group among the entrepreneurial population, while the number of self-employed in agriculture continues to decrease (Pärnänen 2017). Self-employed people have lower income and need to work more hours than wage earners to reach the same median income (Ojala et al. 2017).
Entrepreneurship, with or without employees, is highly male-dominated in Finland (fig. 6.4). Over the last two decades, there was a slight increase in the share of male solo self-employed workers: in 2004 the share among all males in employment was about 10 per cent compared to 12 per cent 2016. At the same time, the share of female self-employed increased only from six per cent in 2004 to seven per cent in 2016. The share of both male and female entrepreneurs with employees has remained stable: three per cent of women and seven per cent of men in employment were employer-entrepreneurs (fig. 6.4).
Distinct forms of NSW are regulated differently in Finland. As regards fixed-term contracts, there must be an objective reason for the fixed term specified in one’s employment contract. If the objective reason remains undocumented, the employee should in principle be permanently employed. The same applies to temporary agency workers without specified reason, with some exceptions, according to a ruling by the Supreme Court of Finland in 2012 (MEAE 2015, 12–13). The regulation of fixed-term work and agency work derives from the EU Directives. However, due to new national legislation that came into force in 2016, it is now legal to hire long-term unemployed people as fixed-term employees for a period of maximum one year (Finlex 2016).
With respect to solo self-employed workers, following the recent reform of the Unemployment Insurance Act of 2106, there are only two legal categories of employed people: entrepreneurs and employees. The revised Act has proven problematic for the self-employed, since the Finnish Employment Office has applied the criteria for “full-time entrepreneur” in a fairly strict way, limiting the entitlement to unemployment benefits for solo self-employed workers.
As regards part-time employees, the specific regulation on part-time work concerns part-time workers’ right to equal treatment and additional working hours. According to Finnish labour contract law (Finlex 2016), part-time employees must be treated equally to full-time and permanent workers. In addition, if an employer has work tasks suitable for the part-time employees already in the organisation, those tasks and extra hours must be offered to these part-time employees first.
In Finland, ongoing debates on NSW are reflected in the media, where numerous stories and reports state that NSW is the “new normal” although statistics and research do not support any drastic changes but rather continuity in the shares of workers in different employment categories (Pyöriä 2017). However, as the analysis in this chapter shows, the debates are relevant as part-time jobs and solo self-employment among own-account workers, freelancers and grant recipients continue to grow. In Finland, there is a growing concern about how the most flexible and insecure new non-standard workers, such as those with zero-hour part-time contracts or in the heterogeneous types of self-employment (e.g. platform workers) can secure sufficient wages and living conditions (MEAE 2018b). Next, we discuss two groups in particular: solo self-employed and part-time workers.
In Finland, most debates and policy initiatives have concentrated on solo self-employment in recent years. Solo self-employed workers altogether constitute more than half of all entrepreneurs. This heterogeneous group includes a declining number of farmers, an increasing number of (often low-paid) freelancers and grant recipients, and for instance subcontracted construction workers (Pärnänen & Sutela 2018). Although the increase in solo self-employment is fairly modest, it continues to gain political attention, partly due to the debates regarding the employment status of new groups such as digital platform workers at e.g. food delivery platforms such as Wolt and Foodora (see below).
Additionally, in context of the protracted Finnish recession 2008–2015, much debate has focused on “forced” or necessitated entrepreneurship, defined as people who start a business because other employment options are either absent or unsatisfactory (Kantola 2015). Dependent self-employment has been described as artificial entrepreneurship or false/bogus entrepreneurship because the worker often depends on only one client and is thus bound as a subcontractor by contracts, schedules and work facilities (Kantola 2015: 27). A common example of this relates to outsourcing of services, in which case the previously employed persons providing these services continue to do so as (reluctant) entrepreneurs (Kantola 2015: 37).
According to Statistics Finland, one-fifth of self-employed people without employees were force by circumstances to become entrepreneurs. There are, roughly, three different routes to solo self-employment: 1) approximately 40 per cent of self-employed workers without employees are driven by an entrepreneurial ethos: they have chosen to work as an entrepreneur of their own free will. 2) Around one-fifth of self-employed workers without employees have been forced by their circumstances to become entrepreneurs, e.g., following cyclical unemployment. 3) For the remaining some 40 per cent, coincidence has played an important role in becoming an entrepreneur; they can be described with the words "fall into and seize the opportunity" (Statistics Finland 2014).
Persistently high unemployment rates may also relate to the increase in solo self-employment following the crisis in 2008. Yet another explanation refers to the increased use of outsourced services in both public and private operations. For example, freelance contracts are increasingly common in the field of media and communication, and cleaning and property maintenance services have become outsourced in industrial sites, retail and public services.
Furthermore, in the 2010s, attitudes towards entrepreneurship have become more positive than before, especially among young cohorts. At the macro level, entrepreneurship is recognised as an important means to catalyse economic growth. The government has in collaboration with relevant stakeholders attempted to improve conditions for business and entrepreneurship as well as renew labour market conditions and working life in order to increase entrepreneurial employment in Finland (Suomalainen et al. 2015). According to the Ministry of Economic Affairs and Employment (MEAE 2017b), “the number of users of invoicing services has increased in recent years and a significant proportion of self-employed people intend to use them also in the future”; this reflects the growth potential.
In recent years, however, the debate on solo self-employment has intensified around food delivery companies and their actions to lower costs. For example, Foodora’s workers were dissatisfied after Foodora changed their reward system and took away the kilometre allowance, meaning that the payments depended on the length of the delivery, overall lowering the payment of the drivers (Helsingin Sanomat 6.9.2018). Similar debates relate to taxi operators.
Despite the substantial debates on the issue, digital platform work remains marginal in the official labour force statistics. Recently, Statistics Finland (2018) reported that only around 0.3 per cent of Finns earned at least a quarter of their income through digital platforms in 2017. However, Statistics Finland excluded those who had earned less than 25 per cent of their income via platforms from the analysis, as many working at platforms most likely earn only a minor, supplementary income via the platforms. Another underlying fact behind the low overall shares of platform workers is that some grey economy is involved. In particular, immigrants without residence permits earn some money by working via platforms.
Furthermore, since 2000, there have been some policy changes that are relevant for grant workers such as artists and researchers, as well as for workers in co-operatives (STM 2013). A co-operative is “an autonomous association of persons united voluntarily to meet their common economic, social and/or cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise” (Pellervo Coop Center 2020.) The policy changes are related to unemployment benefit rules and pension law and apply to those working in co-operatives as well as in the “light entrepreneurship” category. “Light” entrepreneurs have neither legal status as entrepreneurs (nor employee status), which means that they have neither the same rights nor access to social security as employees or entrepreneurs. On the other hand, they neither have the same obligations as “proper” entrepreneurs regarding VAT-legislation nor pension contributions. In practice, their taxation and payment issues are processed by the co-operatives or firms dedicated to offer invoicing services for light entrepreneurs. Nonetheless, the legal changes are important for NSW, since they redefine who is an entrepreneur, which is relevant for working through a co-operative or as light entrepreneur.
Finally, there has been important pension reforms related to self-employment. Before 2017, self-employed workers were included in employees’ pension schemes, necessitating pension contributions to employees’ pension funds. This made their status somewhat unclear as to the difference between entrepreneurs and employees. However, in 2017, the pension law changed, and self-employed workers were transferred to the scope of entrepreneurs’ pension funds. From a cost perspective, this is significant since the entrepreneurial pension insurance is a more expensive (private) insurance. Pension insurance is mandatory above a yearly income of roughly € 8,000. Entrepreneurs can set their pension contribution themselves, consequently influencing their future pension level. However, since pension contributions are not very flexible to changes in yearly income, it may be strategically sound to pay only the minimum required pension contribution. This has another downside aside from a low old-age pension: the unemployment benefit for entrepreneurs is calculated on the basis of the pension contributions (because this indicates yearly income). Low pension contributions therefore de facto also result in low unemployment benefits. Preceding the change in the pension law, the unemployment insurance law also changed in 2016, resulting in only two employment categories: employees and entrepreneurs. This division reflects Finnish tax regulations and eliminates the category of freelancer in unemployment policy. In practice, the new law has been problematic for self-employed workers since the Finnish Employment Office often has been strict in applying the criteria for “full-time entrepreneur”. Their strictness limits the entitlement of solo self-employed groups to unemployment benefits (MEAE 2017b, 31–38; STM 2013), and it has become difficult to get equal access to social security, especially for self-employed people with a very low yearly income or highly irregular income (e.g. artists).
Overall, the number of people in part-time employment has increased by over 100,000 persons over the last two decades, based on the workers’ own reported working hours (Pärnänen 2017). Within this group, marginal part-time work (in the report defined as less than 20 hours work per week) has also increased by 74,000 people. According to Pärnänen (2017), this change can be due to the fact that the two major labour-intensive sectors of the 1990s, namely retail trade and food service activities, started to use part-time labour more commonly. One reason for this was the liberalisation of alcohol policies and regulations: there were more public houses and pubs with alcohol licences and extended opening hours. Another reason relates to EU membership, which meant increased competition and thus led to pressure on businesses to reduce labour costs (Pärnänen 2017). Finally, in the 2000s, several pension reforms introduced novel financial incentives and flexible practices for workers to continue working (part- or full-time) until old-age pension. Since 2017, older workers approaching retirement age can choose the “flexible partial old-age pension”, which replaced the earlier part-time pension system. There are no working hour limits; if the worker chooses the partial old-age pension (at the level of 25 or 50 per cent of the earnings-related pension accrued at the time of retirement), the old-age earnings-related pension is cut down accordingly (Finnish Centre for Pensions 2020.) Working while receiving pension benefits has increased significantly: a fifth of people aged 63-67 worked in 2018, mainly occasionally or part-time. Since 2007, the share has increased by six percentage points (based on registers). Based on the LFS, the share of old-age workers has also increased; in 2018, 14 per cent of age group 65-69 and 7 per cent of age group 70-74 were in employment (Finnish Centre for Pensions 2019.) Clearly, the reformed pensions system has allowed for a variety of part-time work among older workers near and past retirement age (Finnish Centre for Pensions 2019; Pärnänen 2017).
In 2012-2013, the recent developments in part-time work were nationally assessed. A committee, including representatives from employer and employee federations, decided that the current legislation regarding part-time work did not need an overhaul, since the legal rights of part-time employees were considered sufficiently ensured within the existing regulatory framework. The only area of concern was the delegation of so-called extra work. If there is an excess of work in a firm, to whom should it first be offered: a laid-off employee, a part-time worker or a new employee? This was considered as an important labour law issue: which category of employee/personnel takes precedence when employers practice “numerical flexibility” with the number of workers and working hours? Apparently, according to jurisprudence, the decisions in practice belong to employers’ managerial right over manpower, and there may be barriers to challenge employers’ decisions in court (MEAE 2015).
Importantly, another issue related to increased part-time jobs has been highlighted by the Service Union United (PAM), namely the question of “working poor” (Tanner 2017). PAM is especially worried about involuntary part-time employees, and claims that employers dodge their responsibilities and pass on costs to social security systems: When earnings are too scarce for living costs, workers are compelled to apply for various social benefits. For example, in 2015 the housing benefits for those active in the labour market cost Finland about 133 million euros (Tanner 2017).
Ample research has explored various aspects of NSW in Finland. For example, a study by Kauhanen & Nätti (2015) examines well-being among non-standard workers. The research indicates that in Finland, clear differences exist in job quality and well-being depending on the voluntariness of the employment in temporary and part-time jobs. Almost without exception, involuntary temporary and part-time workers’ experiences of their job quality are weaker than those who are voluntarily in NSW. The job quality is perceived as weaker when considering core job quality indicators, such as skills training possibilities, participation in employer-funded training, career possibilities, job autonomy and insecurity, as well as opportunities to learn and grow at work.
Several other studies document work-life balance issues for temporarily employed workers. For example, fixed-term employment tends to delay parenthood, as well as limits parental leave for women, which poses additional challenges since fixed-term employment is more common among women at average childbearing age (Närvi 2014). Another work-life balance issue for temporarily employed workers is found in a study among Finnish academics on short fixed-term contracts (Nikunen 2014). Being subject to managerialism (i.e. persistent performance measures and demands of mobility/internationalisation), the fixed-termed employees’ autonomy (time management) and well-being in terms of family life (demands of moving around and participating in international activities) were negatively affected. For example, employees were responsible for organising their family life in a ‘work-friendly way’, rather than the employer to secure a ‘family-friendly work environment’.
In addition, a study by Ojala, Nätti & Lipiäinen (2018) has examined how heterogeneous temporary employment is reflected in labour market attachment later in life. The study compared permanent (open-ended contract) workers with three categories of temporary employees: substitute workers (typically at female-dominated health and social care and education sectors), highly educated project workers, and “periphery” fixed-term (seasonal, on-call, temporary agency and employment subsidy) workers. Compared to workers in permanent employment, those in projects or periphery temporary employment were more likely to become unemployed later in life, whereas substitute workers were not. Most significantly, the periphery fixed-term workers experienced higher risks of exclusion from the labour market up until retirement age: they most often followed exit paths and accessed disability pension.
NSW made up 31 per cent of all employment (15–74 years) in Finland in 2015. The share of NSW work has remained fairly stable in recent years with variations between forms of NSW: Marginal and long part-time work, along with solo self-employment among freelancers, grant recipients and own-account workers continue to increase, whereas there are no substantial changes in temporary employment since the millennium.
Looking at the sectoral level, the sector of Other Services, including personal services, has a particularly high share of all forms of NSW. Other sectors with high shares of NSW are the creative industry and hotel and restaurant sector, where especially part-time work, covering both long and marginal part-time, is widespread. Also the Education and Health Care sectors tend to rely extensively on non-standard work. Solo self-employment is most widespread within the Agriculture sector; however the second top sector for solo self-employment is Arts/Entertainment.
The people working in NSW are primarily young and older workers, as well as many students and retirees. The high share of older workers is linked to the pension reforms and introduction of financial incentives in the 2000s. The reforms allow for high worker flexibility before fully transitioning to retirement; another reason is that currently, large cohorts are entering retirement age (Finnish Centre for Pensions 2019; Pärnänen 2017). In addition, many part-time workers such as students often opt voluntarily to work reduced hours, while temporary employment is most often an involuntary decision with nearly two thirds of temporary workers reporting that they were unable to find permanent employment. Involuntarily employed temporary workers may experience poorer job-quality and well-being, as documented in several studies. Furthermore, studies have found that temporary employees may face increased risks of labour market exclusion as well as experience increased work-life balance issues.
In recent years, solo self-employed workers and their labour market status have been up for debate, along with discussions on reasons for this type of employment. Around a fifth of solo self-employed workers were “forced self-employees" necessitated by external circumstances such as cyclical unemployment. Despite this, attitudes towards entrepreneurship as a means to catalyse economic growth have become more positive, especially among young people. Yet, access to social security and decent earning and living conditions remain topics of future concern, probably necessitating new regulation as well.
By: Katrin Olafsdottir, Kolbeinn Stefansson & Arney Einarsdottir.
This chapter examines the recent development in traditional forms of non-standard work (NSW) from 2000 to 2017 in Iceland. It draws on survey data from the Labour Force Survey (LFS) and desk research. The main focus is the general development of NSW as well as sector variations and worker characteristics. The chapter also addresses the key issues and debates among social partners as well as relevant policy responses.
The definitions of NSW used follow the Labour Force Survey (LFS) definitions.
In Iceland, the share of NSW is fairly high compared to the other Nordic countries. The share increased slightly from 2008 when 28.6 per cent of all employed were in NSW, to 31.9 per cent in 2015. Still, 68 per cent of all employed people aged 15-74 had full-time open-ended contracts in 2015.
The most common form of NSW is long part-time employment, accounting for 11.4 per cent of all employees in 2017. The share of temporary employment is slightly lower (10.7 per cent in 2017), followed by solo self-employment (7.9 per cent in 2017). Marginal part-time work is the least common employment form among those employment forms examined, with 6.2 per cent of all employees being marginal part-timers. (fig. 7.1).
The type of NSW tends to differ across sectors in Iceland where part-time work – whether marginal or long – was most common in the combined category Wholesale, Retail Trade, Transport and Storage, Hotel/Restaurant sector. Temporary employment and solo self-employment are most frequently used in Agriculture, Forestry and Fisheries. Other Services show up as one of the three largest sectors in all four forms of non-standard work. This category includes Arts, Entertainment and Recreation, Other Service Activities, Activities of Households, and Extra-Territorial Organisations and Bodies. When looking across time, the same sectors are among the top three in all categories of NSW in both 2008 and 2015, except for marginal part-time work (fig. 7.2).
Note: Other Services include Arts, Entertainment and Recreation, Other Service Activities (e.g. hairdressing, computer repairing, etc. (Eurostat 2008)), Activities of Households, and Extra-Territorial Organisations and Bodies.
Marginal part-time employment (less than 15 weekly working hours) has recently increased in Iceland, more so in some sectors than others. In 2008, Construction (12 per cent), and Information and Communication (11 per cent) were among the sectors with the highest share of marginal part-time workers, but were replaced by Financial and Insurance Activities and Other Services among the top three sectors in 2015 (fig. 7.2). In fact, the share of marginal part-time workers in the three sectors where marginal part-time is most common in 2015 is nearly twice as high, and in some instances three times as high, as the average of 6 per cent. 14 per cent of all employed in Financial and Insurance Activities work marginal part-time, 14 per cent in the combined category Wholesale and Retail Trade, Transportation and Storage, Accommodation and Food Service Activities, compared to 19 per cent in Other Services in 2015. The growth in tourism has led to an increase in marginal part-time work in hotels, restaurants and various personal services.
Long part-time employment (defined as 15–29 weekly working hours) is most common in the sectors of Public Administration, Defence, Education, Health, and Social Work Activities, Other Services and the combined category of Wholesale, Retail Trade, Transport and Storage, Accommodation and Food Service Activities both in 2008 and 2015. In all three sectors, long part-time work has become more widespread in recent years and ranges from 23 per cent of all employed in Wholesale etc. compared to 20 per cent in Other Services and 20 per cent in Public Administration etc. (fig. 7.2). As with marginal part-time employment, the increased demand for hotel, restaurant and personal services has led to an increase in long part-time work. Furthermore, for people working shifts in the health care sector, i.e. nurses, long part-time work is quite common and considered standard, since shift work (including night hours) has proved taxing in the long run.
Temporary employment is most frequently used in the sectors of Agriculture, Forestry and Fisheries (17 per cent), Public Administration etc. (15 per cent) and Other Services (25 per cent). The share of temporary employment increased from 2008 to 2015 in all three sectors and these figures are slightly higher than the average (13 per cent) in the Icelandic labour market, with the exception of Other Services. In that category, the share of temporary employment (25 per cent) is twice as high as the national average. Temporary employment is most common in sectors where demand is seasonal, i.e. agriculture and fisheries, as well as in various services that cater to tourists. The use of temporary employment in public administration is due to various temporary projects as well as parental leave covers.
Lastly, solo self-employment had by far the highest share in the sector of Agriculture, Forestry and Fishing in both 2008 and 2015, although the share decreased from 31 per cent in 2008 to 25 per cent in 2015. Construction saw the solo self-employment share increase slightly between 2008 and 2015, from 18 per cent to 19 per cent, while the share in Other Services increased from 17 per cent in 2008 to 21 per cent in 2015. Many farmers on smaller farms are self-employed. Specialised construction workers often work as self-employed, taking on individual projects, while many hairdressers have their own business and work as self-employed.
In sum, the distinct sectors rely on different types of NSW to adjust their workforce to changing economic cycles and production demands. Part-time work – marginal and long part-time – is more frequently used in private and public services sectors. Self-employment is more commonly used in Construction and Agriculture etc. Temporary employment is also widespread in Public Administration etc. and Agriculture etc., but less used in other sectors.
For all analyses on NSW in this chapter, the data source is the European Labour Force Survey (LFS). The Icelandic LFS is carried out continuously throughout the year, with about 12,000 observations per annum.
Due to the small sample size for Iceland in the LFS, we used a collapsed ten-sector version of the NACE rev. 2 for the sectoral analysis. We also merged columns G, H and I reflecting Wholesale and Retail Trade, Transportation and Storage, Accommodation and Food Service Activities; and columns R, S, T, and U constitute Other Services. Furthermore, we excluded real estate-related activities due to small sample size. Other methodological issues are discussed below under the heading “Methodological challenges”.
Turning to the characteristics of workers in NSW, we find that being young, a student, and without a university degree are all strong predictors of both marginal and long part-time work, and the strongest predictor of temporary employment. Marginal part-time work is more common in the urban south-west of Iceland, while long part-time work and temporary work are used more in the rural areas. Being above 65 years old is also a predictor of working part-time, whether marginal or long. Women are more likely than men to work long part-time. We also find that many employees hold more than one job. A different pattern emerges among solo self-employed individuals. Men are more likely than women to be solo self-employed and while being a student is a strong predictor for solo self-employment, other predictors include being above 65 years of age and living in rural areas. Students in Iceland often undertake individual work projects beside their studies and report this income as self-employment.
Marginal part-time work is more common among students, young people and retirees in Iceland, and many hold multiple jobs. The most common reason given for working marginal part-time is having another main activity such as being in school, education or training (72 per cent ) while only 4 per cent were unable to find a full-time job, and another 4 per cent worked marginal part-time due to own illness or disability. The rest – 19 per cent – cited other reasons or no reason as an explanation for taking up marginal part-time work. These figures have changed relatively little since 2008 and suggest that marginal part-time work is for many a voluntary choice (fig. 7.3).
Long part-time work is more common among women, students and retirees. We also find that many hold multiple jobs. Their reasons for taking up long part-time employment are many. However, nearly half of those holding long part-time jobs gave other reasons or no reason as an explanation (51 per cent), while 27 per cent were in school, education or training. Around 12 per cent stated that they were unable to find a full-time job and 10 per cent worked reduced hours due to own disability or illness - figures that have slightly increased since 2008 (fig. 7.4).
Temporary employment is more likely among young people and students. Multiple job holding is also widespread among people in temporary employment. Their main reasons for taking up temporary employment is often that they do not want a permanent job (73 per cent). Around 11 per cent state they were unable to find permanent employment and this figure had nearly doubled since 2008 when 6 per cent stated that as their main reason for taking up temporary employment (fig. 7.5).
Regarding solo self-employment, men, people older than 65, and students are more likely to be solo self-employed. It also seems that at least some of the solo self-employed individuals supplement their income with other jobs. Information on individuals’ reasons for choosing solo self-employment is not available.
In sum, we find that while there are certain similarities between both forms of part-time work and temporary employment, a slightly different pattern has emerged among solo self-employed individuals. Young people, students, retirees and individuals without a university degree are overrepresented among temporary workers, including both marginal and long part-time work. Solo self-employment is more common among men, students and retirees.
In general, the same rules and regulations apply for people in NSW as people working full-time on permanent contracts. In Iceland, the majority of employees are in permanent full-time employment, with a clear period of notice, which either party of the employment contract can evoke. With regard to employee job security and employer flexibility or ease of hiring and firing, there is no legal requirement of stating a specific reason for employment termination in the private sector (Blöndal 2019). However, the private labour market is for the most part regulated by collective agreements which increasingly stipulate that employees can request reasons for termination. Different rules apply for public sector employees, as stipulated in the Government Employees Act (Act no. 70/1996), along with the rules of the 1993 Administrative Procedure Act. The latter stipulates that all administrative decisions must be grounded in objective reasons, that all public employees can request a written justification for termination and that public employees also have a right to be heard (Icel. “andmælaréttur”) (BHM n.d.).
As a member of the European Economic Area, Iceland has adopted three key EU labour market directives relating to NSW. Iceland has passed the Act on Part-Time Work (Act No. 10/2004) based on EU Directive 1997/81/EC, the Act on Fixed-Term Employment (Act No. 139/2003) which is based on EU Directive 1999/70/EC and the Act on TAW (Act No. 139/2005), based on EU Directive 2008/104/EC (Blöndal & Hjaltadottir 2019).
The legal status of self-employed individuals is quite different from employees, as they are excluded from many rights such as minimum wage, annual leave etc. However, self-employed individuals are by law required to pay a share of their income into a pension fund. The share is equivalent to the combined payment from the employer and the employee in regular employment. This is to ensure equality at the time of retirement for both employees and self-employed individuals. Self-employed individuals also earn rights to unemployment benefits and parental leave.
In Iceland, debates on NSW are virtually absent, and research on NSW is limited. Policy debates have focused on the section of the labour market that is not being picked up by the LFS, especially foreign workers and whether their working conditions are in accordance with Icelandic labour laws. A few cases of suspected human trafficking have appeared in the media in recent years.
The most significant change in the Icelandic labour market has been the inflow of foreign workers in recent years. Immigrants accounted for around 14 per cent of the population in 2020 compared to 8.9 per cent in 2017 and 2.6 per cent in 2000. The labour force participation rate of immigrants is similar or even higher than the labour force participation rates of Icelanders (Statistics Iceland, n.d.). The inflow of foreign workers is largely due to labour shortage following the rapid economic growth in Iceland, led by a growth in tourism. The employment contracts that are made with these workers can in many cases be classified as non-standard work. While official figures show some increase in non-standard work, there are indications that it is much more common and not being picked up by the official statistics. Unions increasingly push for stronger regulation of temporary work agencies. This is reflected in recent regulatory changes regarding the operation of temporary work agencies and requiring workplace IDs in certain sectors. The Act on Workplace ID cards and workplace inspection was passed in 2010 (Act no. 42/2010), introduced to ensure that all workers in the Icelandic labour market enjoy equal labour market protection. Based on an agreement between ASÍ, the Icelandic Confederation of Labour, and SA, the Confederation of Icelandic Enterprise, workers in certain sectors are required to have workplace ID cards that are issued by the employer. The sectors that fall under this agreement are defined in detail in the agreement and include among others construction, tourism services and agriculture.
The Act on Temporary Work Agencies (Act No. 139/2005) was passed in 2005 as a response to the inflow of foreign workers during the economic upswing as well as adopting EU Directive 2008/104/EC. Iceland previously had no law on the operation of temporary work agencies as they had little or no presence in the labour market prior to this. The Act ensures that those who enter the country through temporary work agencies have the same rights in the Icelandic labour market as others. Temporary work agencies must be registered and have a local representative. They are also required to provide authorities with information on their operations and the temporary work agencies are not allowed to charge employees for providing them with work.
In a recent study on the market for temporary workers in Iceland, the authors discuss how skilled labour shortage has forced distinct sectors to employ unskilled workers (Magnusson et al. 2018). The skills mismatch was most significant in sectors seeing rapid growth rates. Moreover, the study examined the growing importance of temporary work agencies, as well as the economic rationale for temporary work agencies, and the segmented labour market in Iceland. The study employs an expert opinion approach, together with content and statistical analysis. The experts emphasised that economic conditions in Iceland were the most significant factor in determining the fluctuation of the temporary workforce. They also noted that the increase in the number of temporary work agencies is largely a result of a strong growth rate in specific sectors, most recently in the construction and tourism sectors.
At the time of writing, there are few feasible alternative data sources to the Icelandic LFS. Insufficient data sources constitute an obstacle for analysis, as the categories are small, and data on foreign workforce in Iceland (who often arrive through temporary work agencies) is unreliable. However, Statistics Iceland is making advances in the use of register data for the purpose of labour market statistics, which is a positive development for labour market researchers.
Statistics Iceland collects the Icelandic part of the European LFS, a sample survey collecting information on employment, working hours, unemployment, education and a range of other employment and labour market issues. The LFS has been collected in Iceland since 1991. Between 1991 and 2002 the data was collected twice every year, in May and November. Since 2003 the data has been collected continuously throughout the year.
Each year around 4000 individuals are sampled at random from the National Register. The survey has a panel component, so each person sampled is interviewed five times over an 18-month period. Each interview lasts approximately 5 minutes on average. Response rates are typically just over 60 per cent, yielding around 12,000 observations each year.
There are three main methodological challenges affecting our analysis: 1) small sample size, 2) lack of alternative data sources, and 3) issues on comparability over time.
1) While the LFS sample is not small per se, the sample regarding specific variables is biased, thus making analysis unreliable. What has been most problematic for the analysis presented here is the small number of observations for particular sectors, which forced us to use a collapsed ten sector version of the NACE Rev. 2. We merged columns G, H and I reflecting Wholesale and Retail Trade, Transportation and Storage, Accommodation and Food Service Activities; as well as columns RSTU reflecting various services (including among others Performing Arts, Activities of Membership Organisations, Repair of Computers and Personal and Household Goods (Eurostat 2008: 87-90)). Even so, the number of observations for the real-estate sector were too few to support any conclusion, forcing us to disregard findings relating to it. Immigrants are another problematic group in this context, especially in light of them having higher rates of non-contact and non-response than other groups, and thus indicate a selection bias in the data.
2) Analysis of alternative data sources to address the issues at hand is yet invalid. However, Statistics Iceland is in the process of converting various register data sources into analysable data, which will improve the research possibilities considerably in the near future.
3) The current version of the Icelandic LFS dates back to 2003. Prior to that, data was collected twice every year, in the Spring and late Autumn. There are a number of issues of comparability between the “new” and “old” LFS as seasonal variations were not picked up by the older Icelandic LFS. In addition, the old LFS does not contain a comparable sectoral code as it has an older version of NACE. Hence, we were only able to use survey data dating back to 2003.
Although the traditional full-time open-ended contract continues to be the most common employment form in Iceland, the share of non-standard workers has increased from 29 per cent in 2008 to 32 per cent in 2015. Part-time work – marginal as well as long – is most frequently used in retail, hotels and restaurants with more than 35 per cent of the workforce in these sectors working part-time. Temporary employment and solo self-employment are most commonly used in Agriculture, Forestry and Fishing. The category Other Services that covers Arts, Entertainment and Recreation, Other Service Activities, Activities of Households, and Extra-Territorial Organisations and Bodies show up as one of the three largest sectors in all four forms of non-standard work.
The main characteristics of employees in non-standard forms of employment seem to be either young students or older people, close to or at retirement age. The official data also shows that differences exist in the type of NSW methods between rural and urban areas. In general, the development of NSW in Iceland is closely linked to the economic development, especially the increased demand for labour. However, this is not properly reflected in the official data, both due to the small sample size as well as limited coverage. The increase in foreign workers in the Icelandic labour market led to the Parliament instituting laws on temporary work agencies that import workers into the country. The law requires them to offer the same rights to their employees as others in the Icelandic labour market.
By: Anna Ilsøe & Trine P. Larsen
Much literature has investigated the development in traditional forms of non-standard work (NSW) such as those analysed in chapters 3–7: long/marginal part-time, fixed-term contracts, temporary agency work (TAW) and solo self-employment. However, as we concluded, the overall development in these forms of NSW across the Nordics is relatively stable: not much has happened the last 20 years, and NSW accounts for around a third of all employment with small variations in all five countries. The surface keeps relatively still.
Instead, what we have witnessed is changes in specific forms of NSW with for instance a significant growth in marginal part-time work, notably in Denmark but also in Norway, while there have been rising shares of temporary employees in Sweden and solo self-employed workers in Finland and Iceland (see chapters 3–7). Many of these changes are sector specific. These turbulences below the surface often interact with shifting economic cycles as well as changes in policy, but they may also signal the emergence of new employment practices that we do not know the full extent or nature of yet. Recent debates indicate that more part-timers than previously work on contracts without guaranteed hours (O'Sullivan et al. 2019), and solo self-employed workers may de facto have an employee status, if tested in the courts (Hotvedt 2019; Pind 2020).
In the next three chapters (8–10), we explore these emerging tendencies in depth and ask the question of to what extent they are genuinely new forms of employment or resemble well-known employment forms in disguise.
We especially focus on two tendencies that have received increased attention in recent years: the use of (1) zero-hour contracts, i.e. employment contracts without any guaranteed hours (also often referred to as on-call work) and (2) freelancers operating in the grey area, i.e. freelancers who may not be registered as self-employed due to too few hours or de facto employee status via a freelancer company. These emerging tendencies are not well-researched due to a lack of quantitative data on the specific sub-forms from national data registers at the Nordic statistical offices (for instance from the Labour Force Survey (LFS)). In fact, there are a number of challenges when trying to map these tendencies using quantitative research methods (Pärnänen & Sutela 2019).
In this study, we therefore draw on qualitative methods to capture and better apprehend these emerging phenomena. We have designed our research as a comparative case study, where national teams compare cases within the same sector across two Nordic countries. We have conducted in-depth case studies in three selected areas, where previous research indicates a significant use of either zero-hour contracts (hotels and eldercare) or freelancers (freelancer companies). In each case, several workers and managers have been interviewed. We match each of our cases with a similar case in another Nordic country for a comparative analysis (see table 1).
|Chapter 8: Hotels and restaurants||x||x|
|Chapter 9: Freelancer companies||x||x|
|Chapter 10: Eldercare||x||x|
Our findings suggest that these emerging tendencies are becoming increasingly widespread in the selected sectors. In fact, some of these employment practises are now the dominant employment form at certain workplaces (for instance more workers hold zero-hour contracts than a regular employment contract in the Danish hotel case (see chapter 8 by Bach et al. 2020). Furthermore, it appears that both private sector and public sector employers use zero-hour contracts as a conscious strategy when scheduling work. In the Danish and Swedish eldercare sectors, employers hire on-call workers ahead and consider them as an integrated part of their work plans to cover fluctuations and spare the full-time workers of inconvenient hours (see chapter 10 by Hedenus & Rasmussen 2020). Hence, they are no longer just a tool for handling emergencies, but an element of continuous and planned employment strategies. In the emerging area of freelance companies, particularly freelancers with a certain volume of assignments benefit from attaining employee status, without losing the flexibility of their independent role. However, this way of organising work does not seem to handle all challenges, entailing significant risk of underemployment or unstable work hours (see chapter 9 by Hedenus & Nergaard 2020).
By: Emma S. Bach, Tiina Saari, Satu Ojala, Pasi Pyöriä, Paul Jonker-Hoffrén, Trine P. Larsen & Anna Ilsøe.
This chapter covers, first, an introduction to the hotel and restaurant sector, i.e. the industrial structure and employment development in Denmark and Finland. Second, we describe the two case companies. The last part of the chapter compares the cases, pointing to differences and similarities, along with possible future studies.
In both Denmark and Finland, recent decades have seen a substantial financial growth in the hotel and restaurant sector, reflected in the workforce, numbers of enterprises and turnover. The hotel and restaurant sector appeared less affected by the 2008 economic crisis compared to other sectors such as manufacturing and construction. In fact, the sector in the post-2008 crisis years saw substantial growth rates with the annual economic turnover and number of companies continuing to grow throughout the crisis years (table 8.1). However, since then the Nordic hotel and restaurant sector has been hard hit by the recent corona crisis and the various containment measures introduced by the Nordic governments (see chapter 12).
The Danish hotel and restaurant sector is dominated by SMEs (75 per cent) and solo self-employed workers (18 per cent), and only one per cent of all companies employ more than 50 employees (Statistics Denmark 2019b). We find a similar pattern in Finland with 78 per cent of firms employing four or fewer employees, 21 per cent employing 5–49 employees and only one per cent of all companies employing more than 50 employees in this sector (Statistics Finland 2019).
We find around 117,126 employees in the Danish hotel and restaurant sector and 74,707 in Finland in 2017, corresponding to almost five per cent of all employed in both countries (Statistics Denmark 2019c; Eurostat 2019a). Both countries experience a severe shortage of skilled labour within the sector (MEAE 2019; Dansk Erhverv 2018). Furthermore, it is a sector dominated by non-standard work (NSW) (Rasmussen et al. 2019; MEAE 2019), implying that the traditional measures for calculating the volume of work such as the number of full-time equivalents fail to describe the de facto number of employees (table 8.1). The gap between the number of employees and the full-time equivalents is one of the reasons that it is relevant to look at the emerging forms of NSW and the rationale behind them within the sector.
|Turnover, € millions||€ 6,293 mill.||€ 5,370 mill.||€ 8,284 mill.||€ 6,756 mill.|
|Employees in total, number||88,499||63,202||117,126||74,707|
|Full-time equiva-lents, number||48,126||46,994||60,662||54,417|
Among the Nordic countries, Denmark and Finland rank as top and bottom regarding the share of NSW in the hotel and restaurant sector (fig. 8.1). This chapter focuses on similarities and differences within this sector between the two countries.
Fig. 8.2 indicates an overall growth in both part-time and full-time employment within the hotel and restaurant sector since 2008. However, unlike Denmark, Finland has witnessed a decline in full-time employment and a rise in part-time employment, which can be interpreted as a replacement of full-timers by part-timers. In Denmark today, the number of part-time employees is slightly higher than the number of full-time employees within the hotel and restaurant sector.
Across the Nordic countries, there is a strong tradition of collective bargaining, also within this sector. While there is a collective bargaining coverage of 40-50 per cent in the Danish hotel and restaurant sector (Larsen et al. 2019), the share was around 90 per cent in the hotel and restaurant sector in Finland in 2017 (Eurofound 2018: 31; PAM 2020). In Finland, extension practices are widespread and generally binding also in the hotel and restaurant sector (Eurofound 2018: 33). In Denmark, the strength of the collective agreements is highly affected by the union density. Around one in three of hotel and restaurant employees in Denmark belong to a union (Larsen et al. 2019), compared to around 70 per cent in Finland (PAM 2020).
In the Danish sector, the union density, collective agreement coverage and shop steward presence are lower than in other sectors in the Danish labour market (Ilsøe et al. 2017: 893). Every second or third year, the social partners renegotiate the collective agreements at sectoral level, leaving room for local bargaining.
Although the collective agreement coverage in the hotel and restaurant sector in Finland is high (90 per cent), the non-standard workers may, similar to their Danish peers, experience restricted access to the collectively agreed social protection, labour standards and job security due to various eligibility criteria in the collective agreements and labour laws (Larsen et al. 2019; PAM 2020; Jonker-Hoffrén 2020).
The case company in Finland is a rather big hotel chain, employing around 700 people all over Finland. The individual branches of the hotel chain can serve 300–1000 guests. The Danish case is a conference hotel, employing around 300 people. The hotel can host up to 1,000 guests for dining and conferences. Both com|panies are members of the employers’ association within the sector, and both have a 100 per cent collective agreement coverage. Around one in two employees hold full-time permanent positions in both companies. Case selection was based on a best-case strategy and because the selected companies have a central status in the res|pec|ti|ve national hotel sectors.
A total of 16 interviews with managers and employees were conducted at the case companies. Furthermore, six interviews were conducted with social partner rep|re|sen|ta|ti|ves from relevant unions and employers’ associations: two interviews in Fin|land with The Service Union United (PAM) and the Finnish Hospitality Association (MaRa), respectively, and four interviews in Denmark with two representatives from the United Federation of Danish Workers-Private Service, Hotel and Restaurant Group (3F-PSHR) and two from the Association of the Hotel, Restaurant, and Lei|sure Industry in Denmark (HORESTA).
In this section, we study a case company carefully selected to explore the em|ploy|ment practices used by employers and employees with regard to standard and non-standard work, and especially emerging employment forms in the sector. In this con|text, we explore the various possibilities and challenges associated with the com|pa|ny’s distinct employment practices.
In order to grasp the use of flexible contracts under the best conditions, we selected a ‘best case’ company. We studied a hotel and consider this a critical case, as the com|pa|ny has almost no industrial dispute cases, 100 per cent collective agreement coverage, is a member of an employers’ organisation and is unionised with strong traditions of workplace representation and company based bargaining (Flyvbjerg 2006:230). The rationale was that if we found an extensive use of new flexible em|ploy|ment strategies in this case, we would most likely find them in companies less well organised as well (Ibid.).
The case hotel mostly functions as a con|fe|rence centre and is mainly funded by con|fe|ren|ce activities (returning and booked several years ahead), with peak sea|sons in the autumn and the spring and with fewer reservations during the holiday sea|sons. The hotel can host up to 1,000 guests for dining and conferences. Today, the hotel employs around 300 people, in addition to outsourcing some cleaning tasks to a private company. The main occupational groups are waiters, chefs and cham|ber|maids.
We conducted 10 qualitative interviews with local managers and employees in Sep|tem|ber 2019 (table 8.2). All employees interviewed were in full-time positions, and unfortunately, no employees were hired on zero-hour contracts at the time, al|though some had worked on zero-hour contracts previously. The main reason for this is that the employees with zero-hour contracts are only present when there is a special need for them, thus in our case they were either too busy or absent. In addi|tion, we interviewed four relevant social partner representatives and par|ti|ci|pa|ted in a union conference. In the report, where nothing else is stated, we draw on interview material.
|Hotel manager||Employed for 17 years at the company.|
|Full-time chef and senior shop steward||Employed for 17 years at the company. Works in the kitchen, and has been shop steward for 16 years.|
|Assistant manager, cleaning||Employed for 24 years at the company. Worked 12 years as dish-washer full-time before turning to chamber cleaning (12 years now).|
|Counterwoman||Employed for 35 years at the company. Started out as dishwasher for 6 years, but changed after a knee surgery.|
|Dish washer||Employed for 10 years at the company.|
|Chef||Employed for 1 year at the company. Skilled chef, trained at the company.|
|Waiter||Employed for 4 years at the company. First six month as zero-hour contract worker, then 3.5 years as full-time waiter. Unskilled waiter.|
|Receptionist||Employed for 3 years at the company. Has worked within private services all her working life.|
|Chambermaid||Employed for 4 years. Migrated from Southeast Asia 10 years earli-er, worked as farmer and waiter earlier.|
|Waiter apprentice||Employed for 2 months.|
|Social partner rep-resentatives||Two representatives from 3F, Private Service, Hotel and Restau-rants branch, and two representatives from HORESTA – Employers’ Organisation.|
The case company has four shop stewards who bargain and sign local agreements within their own occupational group in addition to the sectoral collective agreement. Once a year, the joint shop steward representing all employees in the collective bargaining process negotiates with the general manager or the hotel manager. The local agreements cover all employees and cut across occupational groups. The joint shop steward stresses that because the wage and working conditions for some of the occupational groups (i.e. chefs and waiters) are provided for in the sectoral agreement, the local agreement has been a measure to help some of the occupational groups in-house that are less fortunate at sectoral level (i.e. wages for dishwasher and chambermaid staff).
In general, the shops stewards resolve issues quickly, and the hotel has therefore had no examples of industrial actions or related issues. However, one subject discussed among the employees was that the shop stewards rarely organise collective employee meetings to discuss common challenges and issues related to wage and working conditions. Most permanent staff interviewed were unable to tell the types of local agreements they had at the hotel, as discussions between the employees and the shop stewards mostly take place ad hoc. In fact, most employees only hear about local agreements by accident.
There is a strong collaboration between the different departments at the hotel. Every three months, all managers, assistant managers and the general manager meet to discuss urgent issues concerning the working environment, work organisation etc. Once a month, the assistant managers from all departments meet to solve potential collaboration issues. Once every three months, every team has a staff meeting where different common issues are discussed and solved, including union-related issues.
Of the 300 employees at the hotel, 140 are full-time permanent, and 160 hold zero-hour contracts with no guaranteed working hours, but work on average around six hours per week. In addition, the company has strong traditions of investing in training future employees through various apprenticeships and job training activities for long-term unemployed via the local government jobcentre, especially targeting migrants. The job trainees cannot cover shifts in case of illness among permanent staff, and thus cannot be used for cost curbing strategies. Due to skilled labour shortage in the sector, the hotel prioritises to have apprentices corresponding to 10 per cent of the total staff, which is above the general average within hotel and restaurant sector (around 7 per cent) (Pihl et al. 2018). The apprentices are part of the permanent staff, but are always affiliated and work under the directions of a full-time skilled co-worker (i.e. head waiter or chef).
While keeping a core of permanent full-time staff, who have all been with the company for many years and are thus highly valued employees, the case company changed in 2010 its flexible employment practices from primarily using part-time workers up until 2010 to increasingly hiring zero-hour contract workers. Today, there are only a few part-time workers, i.e. in the reception, where one of the two night shift workers works part-time. Earlier the case company also dismissed a few employees in each department every Christmas and then rehired them in March the following year when business started to pick up again. The company has also outsourced cleaning services to a private contractor, whose subcontracted staff clean half of the rooms on a permanent basis. Therefore, zero-hour contracts and subcontracted workers can be considered two emerging employment forms at the company with a different status than the permanent employees:
The employment practices at the case hotel differ across the main occupational groups, but in general, the cleaners, the kitchen and the reception personnel are full-time employees. Here, zero-hour contract workers are mainly used when the permanent staff falls ill or in case of overly busy nights. In the waiter team, most of the employees hold zero-hour contracts. According to most of the permanent employees and management interviewed, one of the main reasons for using zero-hour contracts is that unpredictable situations are in the DNA of the sector and thus employees within the sector need to be highly flexible to handle this. The next section briefly describes how the different employment forms unfold within the main occupational groups at the hotel.
It is often unskilled workers with limited (next to no) work experience that hold zero-hour contracts, and the company offers limited training. A local upper secondary school generates a steady flow of young workers that are hired on zero-hour contracts.
The employees with zero-hour contracts are primarily employed as waiters. The case hotel has around 40 full-time waiters and approximately 100 waiters on zero-hour contracts without any guaranteed working hours. The majority of the waiters on zero-hour contracts are young Danish upper secondary school graduates and university students, often in-between studies. They work around the clock, often at multiple workplaces, to minimise travel costs and increase their earnings:
The hotel manager considers this a win-win situation, since both parties are satisfied with the arrangements and gain flexibility. One of the reasons for using zero-hour contract workers instead of part-time employees is that the students take these jobs to supplement their student allowances (government-financed). By contrast, part-time employees usually hold an additional job to secure a living, i.e. securing enough hours to generate a living wage (Ilsøe et al. 2017). Therefore, part-time workers are often less productive at the case hotel, as they are typically exhausted from working multiple jobs.
However, flexibility is one need of many, and the permanent staff expects a high standard from the employees on zero-hour contracts, especially when it comes to the large events hosted at the hotel. Therefore, the employees on zero-hour contracts must be familiar with the hotel, the tasks and its staff, which is a tough criterion to meet, when there is almost no training or guaranteed employment. Since zero-hour contract workers also often have other work obligations elsewhere, it can be difficult for the staff manager to schedule shifts. Moreover, some of the zero-hour contract workers work in more than one of the case hotel’s departments. However, since the different departments are typically all busy simultaneously, the managers have demanded that zero-hour contract workers be linked to only one team. The cleaning department has particular difficulties in retaining zero-hour contract workers, as their salaries are some of the lowest among the occupational groups within the hotel (table 8.3).
The zero-hour contract workers in the cleaning team are primarily young Danish women and migrant workers from the Global South. The cleaning team only employs workers aged 18 years or older, as it prefers to recruit experienced and highly service minded people often with a background from the retail sector.
In the peak season workers on zero-hour contracts work an average of 15 to 100 hours a month, but some work nearly as much as a long part-time position (15-30 hours a week). The cleaners working most shifts and longest hours are mainly migrant workers. In fact, one of the interviewed permanent chambermaids (originally from Southeast Asia) had been working for two years holding a zero-hour contract prior to her permanent position at the company. When working on a zero-hour contract, she had very few days off, as she was offered shifts almost every day that were difficult to turn down as she had no guaranteed hours. However, the cleaning department do not use zero-hour contract workers as much as subcontracted workers.
At the time of the interviews, there were eight full-time employees with open-ended contracts in the hotel’s cleaning team. The hotel also relied on a private cleaning company to assist with the cleaning of rooms and they are responsible for cleaning half of the hotel rooms.
There is next to no collaboration between the staff from the private cleaning contractor and the hotel cleaning team. The cleaning assistant manager explains that this is mainly due to a wage gap, where subcontracted workers often earn more per hour than the permanent hotel staff, as they work under different collective agreements (section 8.2.4). Although the subcontracted workers and the cleaning staff at the hotel have worked side by side for more than 23 years, the assistant manager is unsure whether the subcontracted workers have a shop steward. Another reason for the limited cooperation is language barriers. The permanent hotel cleaners do not speak Danish or English very well, which means they are often very shy and rarely talk with people they do not know. When needed, the hotel cleaning team upscale by using zero-hour contracted workers, to cover the one half of which they are in charge.
Compared to other countries, the hourly pay in the Danish hotel and restaurant sector is high. However, within the Danish context the sector has some of the lowest collectively agreed hourly wages, also when comparing to the private service sector. Moreover, employees may have difficulties securing a minimum level of weekly working hours and certain groups, migrants in particular, experience wages below collectively agreed standards (Ilsøe et al. 2017; Andersen et al. 2013: 147). Since there are no guaranteed work hours for many positions within the sector (although many in practice work long part-time or full-time), securing sufficient working hours is often a greater concern than the hourly pay rate. At the case company, this is exactly the situation for one of the part-time workers in the reception, who typically takes extra shifts in the dishwasher team to secure enough hours.
At the case company, employees can negotiate their own individual salary if they request a meeting with the team manager, but this opportunity is rarely utilised due to the strong support of collective agreements. The different employment contracts adhere to different clauses in the sector agreement and differ strongly when considering benefits and wages. The standard contract is a full-time permanent position, but all zero-hour contract workers work under a different clause in the sectoral agreement. They are in fact guaranteed a higher hourly wage and thus compensated for their flexibility and lower levels of social protection (table 8.3). The collective agreement explicitly stipulates that zero-hour contract workers have no rights to collectively agreed social benefits like guaranteed working hours, paid parental or sick leave and further training (3F & HORESTA 2017). The higher hourly wage is also one of the main reasons that some permanent full-time waiters at the case company occasionally take extra shifts, as this allow them to top up their income. Such extra shifts are compensated according to the pay rate for zero-hour contract workers and not the collectively agreed rates for overtime, although the waiter has a full-time permanent contract at the hotel.
|Unskilled workers holding zero-hour contracts||Unskilled workers holding per-manent full-time positions|
|Waiters||Min. DKK 155.95||Min. DKK 135.95|
|Chefs||Min. DKK 176.85||Min. DKK 126.77|
|Reception||Min. DKK 138.95||Min. DKK 126.32|
|Chambermaids||Min. DKK 137.21||Min. DKK 124.74|
Source: 3F & HORESTA 2017.
An entirely different sectoral agreement determines the wage and working conditions of subcontracted cleaners at the hotel, as they are covered by the agreement for private cleaning companies. In this case, the private contractor is a member of the Confederation of Danish Industries and covered by the agreement for the industrial cleaning sector. Therefore, their wage and working conditions are slightly different compared to the in-house staff. The collectively agreed minimum wage of the subcontracted cleaning workers (DKK 129.98) is higher than the permanent cleaning staff at the case company, but slightly lower than that of the cleaners with zero-hour contract (DKK 137.21). However, in most private cleaning companies, performance-related pay schemes – the so-called work pace 130 scheme – are widely used. Cleaners working under this scheme receive a minimum hourly wage (DKK 143.56) that is somewhat higher than that obtained by in-house cleaners on zero-hour contract workers at the case hotel (DI and 3F 2017). In this context, it is also important to note that for subcontracted cleaners, the pay is not necessarily determined by the number of working hours, but by how many rooms they have cleaned. If cleaners are unable to do their job within the hours allocated, they will typically be forced to do unpaid overtime (Larsen et al. 2019).
Several interviewees stressed that people who choose to work in the hotel and restaurant sector enjoy an unpredictable work life with constantly changing tasks, and that the flexibility means highly devoted employees in exchange for exciting experiences every day. This is also the case for an assistant manager working in the kitchen, who voluntarily has a divided shift every Saturday: He works the morning shift; is off duty for 3–4 hours and checks in again for a supper shift, as he enjoys to carry out an entire Saturday shift. Arrangements of this kind were abolished from the sector agreement years ago, but can continue if consented to by the local social partners. Nevertheless, the general norm at the case hotel is that all kitchen staff are on full-time permanent contracts, and each employee has a repeating 7-week schedule. In case of illness among permanent kitchen and reception staff, the other permanent full-time employees typically cover the shifts, with overtime balanced afterwards through compensatory time off (at overtime rates). The dishwasher team uses zero-hour contract workers to cover in case of illness, since their team is smaller and the tasks require less instructions or in-house knowledge.
Moreover, zero-hour contract workers rarely take part in the various joint meetings at the workplace, although the permanent staff interviewed have called for this, especially with zero-hour contract waiters, to coordinate and share information about how to manage job tasks, secure basic hygiene as well as suitable work attire.
Regarding health and safety issues, all interviewees agreed that there is a rough rhetoric within the sector. The zero-hour contracted waiters are especially exposed to snappy comments and blunt instructions from permanent staff during dinner service, since they are busy making sure that everybody knows where to be and what to do. Given the fact that zero-hour contract workers rarely participate in workplace meetings, it remains unclear whether these concerns are voiced and reflected in managerial practices.
Another issue concerning health and safety relates to the many full-time cleaners being migrants, mostly from Thailand, the Philippines, Burma and Vietnam. The view among hotel staff is that their Southeast Asian colleagues have a great work ethic, but there are also language barriers as they often speak limited Danish or English. The hotel offers language courses to overcome such issues, primarily offered to full-time employees, but also to some zero-hour contract workers regularly working at the hotel. The language course duration is typically 12 five-hour days and takes place during normal working hours at the company site, free of charge for the employees.
The main theme appearing in this study is how the case hotel increasingly uses zero-hour contracts. A large part of the core staff has been working at the hotel for many years and appears to be the best of the former employee group. For some of the former non-standard workers, the strategy of moving to zero-hour contracts has served as a stepping stone into permanent employment, however not for all. During the recent economic crisis, the hotel dismissed all part-time employees, as it wished to abolish seasonal hiring and firing of permanent staff. Instead, it developed an employment strategy based on using zero-hour contract waiters and subcontracted cleaners as a buffer to secure the flexibility needed to adjust to seasonal and cyclical activity swings. Interestingly, part of the reason for using zero-hour contracts has also been so secure more stability among the permanent staff. Since we find such employment forms in a well-organised best-case company, they are also likely to be found in many other companies within the Danish hotel and restaurant sector.
We approached this particular company because it is one of the central players in the Finnish hotel industry and would presumably serve as a good example of employment practices in the Finnish hotel sector.
The case hotel belongs to a chain running dozens of hotels all over Finland, with around 700 employees in total (subcontracted and agency workers not included). There is no information available about the union density within the case hotel, because in Finland, the employer is not allowed to keep track of union memberships. The hotel chain is a member of the Finnish Hospitality Association MaRa (employer’s organisation) and follows the collective agreement for the hotel sector. In line with Finnish legislation, there are workplace representatives who participate in cooperation councils.
We conducted seven qualitative interviews in two branches of the hotel chain: six interviews with employees plus one interview with a HR manager in May 2019 (see table 8.4). Some of the employees we interviewed held permanent positions and some had part-time and/or fixed-term contracts, and one was an agency worker. In addition, we interviewed two representatives from the relevant social partners.
|HR director||Permanent, full time||Several years of experience of this work.|
|Receptionist||Part-timer, fixed-term||Just finished their studies.|
|Receptionist||Agency worker, part-timer||Just finished their studies.|
|Breakfast waitress||Permanent, full time||Worked in various hotels and restau-rants, including this one, several years as agency worker|
|Waiter||Agency worker, full time||Several years of experience of this work.|
|Workplace repre-sentative||Permanent, full time||Works also on customer service. Sever-al years of experience.|
|Social partners||Representatives of The Finnish Hospitality Association MaRa and Service Union United PAM|
Table 8.4 Overview of interviewees
This hotel chain follows the collective agreement for the hotel sector consistently. The company has a council, which is a combination of a cooperation council and an occupational safety committee. The members include workplace representatives, the shop stewards and managing director, Director of Human Resources and personnel manager, who is also an occupational health and safety manager. In addition, the company tries to solve everyday problems at the workplace level, as employees may participate in development meetings, weekly meetings and workshops. The company’s declared goal is to treat all employees equally regardless of their contract being standard or non-standard (e.g. through an agency) and workplace representatives have been working through issues to this end. In this hotel chain, permanent full-time workers have employee benefits, i.e. discounts on hotel bookings at the chain’s hotels in Finland and Europe. Non-standard workers enjoy similar benefits to a limited extent. A more problematic issue relates to agency workers’ occupational health care, which is discussed further in the health and safety section below.
Hotel business is highly influenced by seasonal fluctuations: there is a summer peak season and a winter peak season in Finnish Lapland, in particular. During peak seasons, the need for employees is at its highest and extra workers are needed. Some of the hotels in this chain have facilities for large banquets, serving 300 to 1000 guests. Consequently, there is a lot of non-standard labour needed from time to time in this hotel chain.
A little over half (52 per cent) of the employees have permanent full-time contracts, 8 per cent are temporary full-time employees and 40 per cent are part-time employees. Among these, 12 per cent have zero-hour contracts and 28 per cent have fixed-hour contracts, but there is no information on whether the part-time employees hold permanent or temporary contracts. According to both the representatives of the employee and employer associations of the hotel sector, those working with non-standard contracts are mostly young women. However, the interviewees at the hotel did not address any common characteristics for non-standard workers; they represent all genders, ages and life situations.
The main reason for using temporary full-time employment is to replace employees who are on leave, e.g. maternity leave. The share of part-time workers is high compared to the overall shares of the sector in Finland (see fig. 8.1)
There are no accurate numbers available for the share of agency workers in this particular hotel chain. However, both the interviewed managers and employees stated that temporary agency work (TAW) is commonly used. The reason for this relates to the great fluctuations in the demand for employees. In addition to seasonal fluctuations, there are also quick changes in customer flows: online bookings have changed customer behaviour, and last-minute bookings occur frequently. A few years back, the hotels could more easily anticipate the need for labour in advance. Overall, hotels need and must use flexible work force, such as agency workers. One interesting finding is that a group of old-age pensioners take shifts as agency workers at large banquets or conferences, whenever there is a need for experienced and skilled employees.
The newest forms of non-standard work, such as self-employed or platform workers, are not used in this hotel chain. Meanwhile, for instance food delivery firms are now seen as partners of the hotels, although the hotel itself does not employ these workers directly. A lot of work is outsourced, e.g. the cleaning duties. According to other studies, subcontracted hotel cleaning companies often employ immigrants, which is true for this hotel chain as well.
All interviewees considered NSW mainly as a win-win situation: the hotel needs flexible labour, and workers are willing to work in non-standard contracts for various reasons. Many employees at the case company rate their non-standard arrangements as flexible, as those who work part-time or as agency employees can have a say in when and how much they work – part-time permanent workers have the flexibility to arrange their work schedule (unless they have fixed hours), and agency employees can refuse work offers from their agencies; in fact they may have to if they want time off for annual leave. By law, holiday rules are to be applied equally in all employment relationships. However, in practice agency workers do not have equal holiday rights compared to employees with full-time, fixed-term and part-time contracts: If the employment relationship is very short, for practical reasons the employee may not have time to take the annual leave, in which case the holiday is replaced with a compensative allowance at the end of the contract term (MEAE 2017a). Thus, it is more difficult for agency workers to secure a work-life balance than for permanent employees.
Nevertheless, employees, managers, workplace representatives and social partners are all aware of the flipsides of non-standard work, the insecurity in particular. In the first months of the year, the hotel sector is rather quiet. Employees with non-standard contracts cannot be sure how many hours will be available for them, if any. However, those who have worked for this hotel chain for several years are quite safe and sure to get enough hours. For those with short tenure, the insecurity is more pronounced. A strategy for workers to gain access to the more stable employment positions is to do an excellent job to show their skills and basic values.
Many of those who work part-time or other forms of NSW are students and thus voluntary non-standard workers. For (young) people in vocational education, hotels and restaurants offer apprenticeships and other practical training. This offers an opportunity for the trainee to be recruited to these hotels, either as an agency worker or employed directly by the hotel. The shortage of skilled workers within the hotel sector makes offering apprenticeships one way for the hotels to recruit the most talented employees.
One interesting phenomenon is that some employees worked for more than one agency, enabling work for many hotels (of the same or different chains) and securing more hours, as they could choose their own work shifts. Presumably, some of these contracts with different agencies are either zero-hour or part-time at the same time. In this hotel chain, new employees were offered the possibility to work in either all or just one of the chain’s hotels, depending on their preferences. The agency workers who worked for only one hotel were motivated by their team, knowing their “own” hotel well, or struggled with expectations of being an expert at many hotels.
The non-standard contracts had some impact on the team spirit, stressing the need for excellent HR management. The interviewees appreciated the strong sense of community within the hotel chain, and some of them emphasised how they felt a sense of belonging to “one group”, making it less important or not important at all what kind of a contract an employee had. The interviewees described a high level of loyalty among agency workers and other non-standard workers: some had taken shifts during holiday, some had postponed leisure plans to take a “last-minute” work shift, some wanted to work only in one particular hotel because it had a good atmosphere and nice managers. Employees were also flexible and ready to do long shifts when needed, if they reciprocally could enjoy goodwill and flexibility from the employer side.
According to legislation, employee benefits are determined by the employment contract and the applicable collective agreement. However, if TAWs and company employees have different collective agreements, their terms and conditions are usually different (MEAE 2017a).
The use of NSW influences the daily routines at the hotels: which employee group is called in to work is highly dependent on the daily programme and thus how many employees are needed. As a result, it is sometimes a surprise with whom you work. Some extra on-call workers work regularly and know the routines of the hotel, but if there are new employees, the permanent or more experienced employees have to give instructions along with fulfilling their own tasks. This is also a question of leadership and management: a striking share of managers’ work time is spent guiding new employees – especially for workers not familiar with the code of practice.
According to Finnish law, workplaces with more than 20 employees must have a workplace representative. This hotel chain has workplace representatives and division representatives, who also participate in the cooperation committee. According to the interviewed workplace representative, the most common issues needing an intervention relate to work time planning and health and safety. Management practices have occasionally also required some action.
This hotel chain, including our case hotel, employs extra workers from multiple employee agencies. The contracts vary from agency to agency; thus, whether the contract includes comprehensive health care depends on the employee agency and employees’ contract type with the agency firm. In Finland, all employees are entitled to health care insurance, but employers can choose to use either public health care (subjects to charge at the employees’ own expense) or private companies (paid by employers). This is an important topic: even though Finland in principle has a universal health care system, in practice most salaried workers have access to private health care services offered by the employer, which also applies to the case hotel chain. While some agency workers have access to these private health care services free of charge offered by their agencies, other agency workers are not entitled to these services and have to use either municipal health care services or pay for private sector health care services by themselves. Some agency workers having to use municipal health care are thus in an unequal position compared to other employees.
The most important issue concerning work-life balance in hotel work is shift work and working time in general. Not all hotel employees work shifts, however, but the interviewees who do find it quite stressful and challenging. According to the interviewees, there are also some employees who only do night shifts at the reception. Employees emphasise the importance of having enough time to recuperate after night shifts. The Finnish occupational health and safety legislation gives a framework for working shifts in terms of planning them in advance, and although this hotel follows the law, there is some room for company-based negotiations and deals.
A central work-life balance issue is the amount of working hours. Agency employees may have many working hours by choice, often being employed by several agencies or hotels in order to secure a sufficient income (see also Ilsøe 2016). In some cases, they may even end up working too much, which can be very stressful and even pose occupational safety issues.
According to the interviews, our case hotel chain is well-managed, making an effort for the best of their employees, having managed to earn workers’ loyalty and commitment in exchange. However, it is obvious that the story of working for the hotel sector in Finland also includes less pleased employees.
All interviewees of this hotel case, including union representatives, employers and employees in various positions, saw NSW as an inevitable part of hotel business. Hotels produce services, and service work cannot be conducted beforehand; service work involves work on-demand, thus employees are needed when customers are on site. Simultaneously, the hotels’ need for labour changes all the time, and flexible forms of labour and non-standard contracts are seen as a practical, cost saving and necessary solution, although it is not the only possible way. According to several interviewees, the hotel sector could enhance more secured work contracts for employees willing to commit themselves to the employer.
However, all the interviewed parties were generally positive towards non-standard work. There were a large number of people voluntarily working on non-standard contracts, mainly students and sometimes retired workers. Meanwhile, all interviewees were aware of the flipsides of non-standard work. Major issues relate to the insecure position of agency workers and their entitlement to health care services. However, non-standard contracts are also stepping stones to more permanent contracts. Because there is a shortage of skilled workers in the sector, NSW is an opportunity for those who want to become permanently employed within the hotel sector.
In both countries, the hotel sector is highly influenced by seasons: the fluctuating seasonal demand for labour makes it difficult, if not impossible, to foresee the number of employees needed. Thus, in order to hire the right number of employees to fit both low and peak seasons, much flexible and temporary labour is used.
The two main sources of flexible labour used in the two case hotels are part-time/ zero-hour contracts and outsourcing of services. In both cases, for the most part, the cleaning tasks are outsourced and performed by workers in various subcontracted companies. Unfortunately, the implications of outsourcing cleaning tasks in these cases are hard to evaluate, as in both instances it proved impossible to interview subcontracted workers from cleaning companies. Yet, both cases report that this arrangement is widespread within the sector, and is the rule rather than the exception, especially for the larger hotels.
The main non-standard form in the Finnish case is fixed-term part-time contracts and in the Danish case zero-hour contract work. The types of NSW in the two countries are not that new; in fact, both employment types have been used for years – —earlier it was labelled “on-call work”. What is new is the scope of the phenomenon and that this indicates a changed employer strategy.
In the Finnish case, almost half of the employees (40 per cent) are part-time workers, most of them on fixed hours. In addition, the hotel hired agency workers (mainly waiters, receptionists and other customer service personnel) that have temporary or permanent contracts and either zero hours or fixed part-time hours. Thus, parts of the workforce used in the Finnish hotel case company is characterised by uncertain hours for the employees, especially for those who hold zero-hour contracts. Even if their hourly wages are based on collective agreements, they may not get enough shifts in the low seasons, as zero-hour workers have no right to contract-guaranteed minimum hours. However, in the Finnish case company, the agency workers in particular regard the arrangement as flexible, as they have a say on when and how much they work. They appear less affected by struggling to secure enough hours, as they can be employed by several agencies and work many shifts at several hotels, and therefore feel rather safe.
In the Danish case company, workers on zero-hour contracts dominate the flexible labour force, and have replaced fixed-hour part-time workers in recent years. The zero-hour contract workers have no guaranteed weekly hours, no obligations to take more shifts at the company, yet they still receive workplace accident insurance and holiday payment (by law). Workers with zero-hour contracts at the case company receive a higher salary to compensate for the job insecurity according to the collective agreement. However, using part-time work seems less flexible for Danish employers, compared to the fixed price for zero-hour contract workers due to overtime payment rules in the collective agreements.
In both Denmark and Finland, the simple hourly pay also pertains to overtime work, if it is voluntary. If the employer demands the overtime work and it exceeds the hours in the contract or the collective agreement thresholds, the overtime pay rates apply, often 1.5 or 2 times the hourly pay, depending on the time of day it happens (Occupational Safety and Health Administration in Finland 2019; 3F & HORESTA 2017). This make it rational for the employers to rely on zero-hour or on-call part-timers.
Neither of the case companies make use of platform or freelance workers; in fact, none of the interviewees in either of the two hotels point to a rise of gig platforms or so-called solo self-employment in the sector, even though it is noted that these employment forms do exist here. Particularly the Finnish hotel regards the labour platforms as partners within the sector rather than as competitors, as the platforms, i.e. food delivery or taxi services, provide a high service standard that go beyond usual hotel tasks.
Flexible work scheduling and NSW are considered an inevitable part of the hotel and restaurant sector, as it is necessary to match customers’ behaviour and daily rhythm. In both the Finnish and Danish case, employees mainly perceived NSW as a win-win situation, as students and young people in particular are willing to work many shifts and long hours, and employers are happy to pay the extra money for this flexible workforce. However, in both cases, shop stewards and union representatives were aware of the flipside (job insecurity) of non-standard work, and especially the question of living hours (securing enough hours to generate a minimum of pay) (Ilsøe et al. 2017). In both cases, the insecurity was most dominant for the flexible workers who had a short work record at the hotel.
In Denmark, the social partners have negotiated a so-called chambermaid protocol to increase the number of full-time workers among chambermaids. The idea is to use more flexible working time arrangements to facilitate more full-time staff (box 8.1). In Finland, the employers and unions have created similar trade-offs covering skiing hotels. Here, they preserve the working time flexibility for the full-time staff making it more attractive for employers to hire workers on full-time contracts (box. 8.2).
In the collective agreement in the hotel sector, a chambermaid protocol was introduced in 2017 (3F & Horesta 2017: 46ff). The main target group is chambermaids, and the agreement allows for flexible working time arrangements in return for guaranteeing that at least 45 per cent of chambermaids are full-time employees. The background for the protocol is the asymmetric workload of chambermaids, which centers between 10 a.m. and 2 p.m. Although the 45 per cent threshold sounds as a small share, it is a vast improvement as few chambermaids worked full-time previously. Part of the compromise was that the union 3F-PSHR had to agree to a more flexible work organisation and more relaxed working time arrangements for part-time employees, including no overtime payment if overtime is voluntary.
The irregular demand for work has in some places been met by allowing deviations from regular working time. For instance, skiing centres have developed an innovative working time practice where employees working in excess of 112.5 hours in a three-week period have compensatory time off. This only includes employees with full-time, permanent contracts or at least a one-year contract. As a result, this system has encouraged employers to make permanent contracts with formerly fixed-term or even agency workers.
The hotels in both countries report a severe shortage of skilled workers, and highlight this as the main reason for recruiting unskilled and student workers to such a wide extent. However, in the Finnish case, interviewees point out that NSW can serve as a stepping stone to more permanent employment. What we see in Denmark is not as clear. Like in Finland, the majority of the non-standard Danish workers are students, many educating themselves for careers in other sectors. In both countries, these students, except for the hotel and restaurant apprentices, are not looking for a permanent position, but work in the sector to supplement their state-funded student allowances.
Sometimes agency workers and company employees have different collective agreements; thus, their terms and conditions are also different in those cases (MEAE 2017a).
In Finland, health care services arranged by employers are mandatory, but they can be organised via the public health care system (where a user fee may apply) or by employers’ contract with private health care companies. The majority of all Finnish employees, also in the hotel case, have access to these well-resourced private health care services fully paid by employers. However, this is not the case for the many part-time agency employees (where the agency contracts differ from the company contracts). Public health care services, besides being subject to a user’s fee, have fewer resources and severely limited reception hours. Therefore, there is no guarantee for many agency workers to have access to instant health care services, dissimilar to those hired directly at the case company.
In Denmark, there is a universal health care system with no user fee on services. However, the clauses regarding paid parental leave, further training and other social protection issues in the collective agreement exclude zero-hour contract workers. The main reason that many prefer work in zero-hour contract is the relatively high pay with no education or skills required.
The Danish sector-level agreement compensates to a degree for the differences between full-time staff and zero-hour contract workers by guaranteeing a higher hourly wage for zero-hour contract workers. In that way, Danish social partners address the gap in protection and earnings (box 8.3). Workers with zero-hour contracts and wages following this collective agreement are mainly used by larger companies, as their need for flexible labour is greater and they have the financial means to pay for this extra flexibility. However, insecure hours and lack of participation in meetings at the workplace continue to be an issue for this employee group.
In the hotel sector, collective agreements have for many years regulated wages and working conditions for people on zero-hour contracts. The hourly wage for zero-hour contract workers is set at a higher level than that of full-time permanent employees, as the cost of hiring without guarantees for the employee should be equally high to the employer. The employment form is regulated in order to secure a living wage for the employees, although the hours may be few and the employee has no rights to sick pay, pension and other provisions.
Moreover, the low union density also affects the full-time employees, as the high staff turnover may have implications for health and safety. Over and over, co-workers must provide introduction training for new colleagues, and the workplace culture is challenged by the constant inrush of new colleagues.
For the individual employee or company, the flexible work arrangements might be considered a win-win situation. The two hotels are so-called best cases with full collective agreement coverage, high density rates and fairly well-ordered conditions. Although the flexible labour buffer is also quite well-covered by collective agreements and the workers seem to enjoy decent hourly wages, they are still at risk of uncertainties regarding working hours, earnings, holiday, employer responsibility, access to social benefits, retirement plans and health and safety arrangements. This indicates that a changing pattern of segmentation is also associated with a certain dualisation of workers’ social rights. This may be more accentuated in smaller firms without collective agreements, perhaps more so in Denmark than in Finland where the collective agreements are extended and binding for all employers in almost all sectors. The case hotels’ large buffer of flexible workers raises questions about the implications for the Nordic labour market model and how these challenges are resolved in smaller and more poorly organised hotels. The sectors’ ongoing decline in union density rates may similarly cause some concern for the continuous support of the collective bargaining model in the sector. The findings in our two best-case hotels are at any rate indications of a more segmented labour market in the sector where the boundaries between the well-protected core workers and the growing layers of fluid, flexible labour are not only redrawn but also becoming sharper.
In this case comparison, we studied two best-case companies, both large, well-organised hotels. However, we are left with curiosity regarding the conditions within smaller, more poorly organised companies – are the same dynamics present there? We need more qualitative studies to fully grasp the nature and prevalence of NSW within the hotel sector in Denmark and Finland, especially at micro level in small enterprises.
These qualitative case studies in the hotel and restaurant sector illustrate why the statistical rise in (head-count) employment in the sector is in no way mirrored in a corresponding rise in the volume of work (measured in man-years) nor in the number of people in full-time positions. While existing databases measure the number of hours worked or the number of people working in the sector, what is genuinely needed is a register that pulls together the number of hours in different jobs per person. In addition, in both companies we find several employees holding multiple jobs, some to secure living hours, others because they enjoy the variation. In the Labour Force Survey (LFS), the concept of multiple job holding only considers primary and secondary jobs and thus excludes the situation where individuals hold three or more jobs. In many instances, this distinction is insufficient to fully capture the problems regarding multiple jobholders as many often hold more than two jobs. Moreover, in light of the Finnish case one may ask who provides the health care services in situations of multiple jobs, and who secures compliance with working time regulations and overtime payment agreements.
A common challenge in both country cases is also to obtain an overview of contracts in order to know more about the employees’ rights. As we have no clear picture of how widespread the different employment forms are, and those covered by collective agreements are only registered at aggregate national level, it is difficult to estimate the wider implications of the emerging forms of NSW. Consequently, researchers need novel measuring methods in order to capture the contractual traits, especially as regards employee rights and social benefits, but also in order to better estimate the volume and composition of non-standard work, e.g. the amount of zero-hour contracts at the sectoral and national levels.
Moreover, information on collective bargaining coverage at company or employee level is unavailable in several of the Nordic countries, making it difficult to analyse how these emerging employment forms interplay with the Nordic models of labour market regulation.
Our case studies in the hotel sector indicate that the NSW practices are here to stay. The union density in the sector is relatively low in both countries, presumably as a result of the temporality of the workforce. The case studies suggest that the sector increasingly use new contractual solutions as a means to enhance employment flexibility. Hereby, the zero-hour contract workers and the part-time workers become the main risk bearers as they hold uncertain positions with no guaranteed hours and lower levels of social protection compared to the permanent staff at the case companies. Generally, it appears that the sector has handled the economic crisis by changing employment practices to a more flexible workforce in order to secure a small core of highly valued permanent staff.
The main difference between the two cases is that the Finnish case to a large extent uses part-time employment (often hired through agencies), while in the Danish case zero-hour contracts have become the main flexible employment form used. One in two in both cases work part-time or on zero-hour contracts. Whether this is indicative of a broader, general trend in the hotel sector remains to be examined. At any rate, based on our best-case observations there is good reason to believe that the increase in flexible part-time work and zero-hour contracts is an emerging, growing employment strategy in the sector, with important consequences for employment, income and social security as well as for the functioning of the sectoral labour market. The apparent consequence is that the boundaries of segmentation between the core and periphery workers are redrawn and becoming sharper, accompanied by a tendency towards dualisation of social rights.
By: Anna Hedenus & Kristine Nergaard
In this chapter, we focus on freelance companies in Norway and Sweden. Freelancers are workers who obtain their own contracts to work on short-term assignments. These workers can either be self-employed or employed on short-term contracts by the client. A third option is to be employed by a freelance company. By joining such a company, self-employed freelancers attain the status of employees, albeit employees of the freelance company, not of the client.
In both Norway and Sweden, legislation is based on a binary distinction between self-employed people and employees, with no intermediate categories (Westregård 2019a; Hotvedt et al. 2020). This regulates wage and working conditions, including the rights to sick pay, holiday allowances, pensions and unemployment benefits) as well as taxes. In Norway a third category exists in tax and social security law: “non-employed employees” or contractors. These are people who receive a salary or other remuneration for completed work or assignments, but who are not employees.
In general, employees have better rights to social benefits and better income security (wages) and employment security. On the other hand, tax regulations may benefit the self-employed. The self-employed run their own businesses and secure their own assignments, while employees work for an employer. Neither group can simply choose their legal employment status freely as it depends on the sets of rules in question. In addition, there are grey areas between being self-employed and being an employee.
Both Sweden and Norway have companies that employ freelancers (also referred to as “co-employment” or “umbrella companies”). By being affiliated with a freelance company, freelancers may attain the status of employee, and thereby gain access to social rights that they would not be entitled to as self-employed workers running their own business. In addition, the freelance companies provide other services, such as invoicing services for work performed by the freelancers. Contrary to most employers, the freelance company has little or no influence on how the work is performed or the number of hours billed, i.e. income/wages.
In Sweden, we find more than nine established freelance companies. Accordingly, freelance companies are claiming a position in the labour market arguing that they provide an important alternative to traditional employment (c.f. SOU 2017:24; Bjerke & Pettersson 2013). In Norway, we only find a couple of examples, and these freelance companies have not gained a significant foothold.
In this case comparison, we will examine one Norwegian and one Swedish company employing freelancers. How do these companies operate and how can this be understood in relation to the contextual similarities and differences between the two countries? Are such companies an answer to the more precarious situation that some groups of self-employed freelancers face? In both countries, we have interviewed managers and freelancers. The Swedish case report also contain information provided by the business organisation for Swedish freelance companies. The qualitative reports of this chapter are based on a total number of nine interviews. The Norwegian case analysis was conducted by Kristine Nergaard, and the Swedish case analyses were conducted by Anna Hedenus.
In both Norway and Sweden there are companies that cater to freelance employeesIn Swedish called ‘egenanställda’., i.e. to those who perform assignments for clients without being employed as wage earners by them. Table 9.1 illustrates some of the different contracts and affiliations a worker in Sweden or Norway may have. It also helps define how freelance employees differ from other atypical or typical contractual forms, included traditional employment.
|Type of organisation||Traditional organisation||Temp agency||Freelance companies||Billing companies||Platform companies|
|Employee on open-ended contract, one main workplace||X|
|Employee on temporary contract, one main workplace||X|
|Employee on open-ended contract, various workplaces/clients||X||X |
|Employee on temporary contract, various workplaces/clients||X||X |
|Self-employed||Own business||(X) |
The freelance companies invoice the assignments carried out by the freelancers, deduct tax from their income and pay the employer’s social security contribution. In other respects, the companies assume varying responsibilities in the follow-up of their employed freelancers. By being employed in freelancer companies, these freelance employees are in principle ensured the same rights and benefits as traditional employees. Such rights can apply vis-à-vis employers, authorities, or as in Sweden, an unemployment benefit fund. One restriction, however, is that some rights are earnings-related, which means that low or unstable income influences pay-outs. This is the same principle that applies to other employees, but freelancers will in general have a more unstable income than the average employee. Another restriction is that the freelance company does not guarantee its freelance employees any minimum or standard income. Compared to traditional employers, freelance companies have little influence over the work undertaken, since the freelancers themselves obtain their own assignments and perform the work. In their report on future labour law, Hotvedt and Munkholm hence categorise this contractual form as a challenge of “artificial employment contracts” (2019:06, p. 12).
The companies in focus in this chapter assume formal responsibility as employer, and thus need to abide by the legal framework that regulates employment. In this way, they differ from bookkeeping and billing companies that merely assist with financial and related administrative aspects of employment. Freelance employees may therefore have greater social protection compared to platform workers and freelancers with their own business or other forms of self-employment. All companies that are members of the Swedish business organisation for freelance companies have committed themselves to take on the full responsibility of an employer. It should be noted, however, that not all freelance companies in Sweden are members of the trade organisation or take on this type of responsibility. Freelancers affiliated with these other companies will thus not gain the status of employee (see section 9.3.4; also Westregård 2019b).
Short-term work as an employee (on either open-ended or short-term contracts) can also be performed within the context of a temporary work agency. Being a freelance employee is, however, different from being employed by a temporary work agency, as the entire responsibility for finding assignments rests on the employee.
In Sweden, the frequency and visibility of freelance companies is highly dependent on the marketing and policy work undertaken by the business organisation for freelance companies, Egenanställningsföretagens Branschorganisation (EB)http://www.egenanstallning.org/. According to this organisation, founded in 2012 and currently comprising nine member companies, the freelance companies in Sweden currently employ about 45,000 freelancers. In Norway, this group of workers is not represented in their own right, as in Sweden, and a separate industry consisting of companies that hire freelancers is yet to emerge. However, at least one Norwegian company hires freelancers, with a special focus on freelancers in creative occupations. Some Swedish companies also market their services to Norwegian freelancers.
Here we examine two different companies that function as employers for freelancers, one Swedish and one Norwegian. The Swedish company recruits freelancers in a wide range of occupations and has employees who work full time as well as some who undertake assignments only intermittently. The Norwegian company serves established freelancers, mainly within the field of music and sound but also in other creative occupations.
|The case company||Norway||Sweden|
|Size||100 + freelance employees||40–50 freelance employees|
|Recruited from (main affiliation/group)||Self-employed (sole proprietorship)||Assignment workers with or without a business tax certificate|
|Main occupation among freelancers||Culture workers (but open for other groups)||Many occupations incl. doctors, IT consultants, transport workers|
|Type of competences in case company||Professionals||Variety|
|Main services from employer||Invoices, expenses etc. |
Social security as employees (taxes, pensions, sick pay)
Part of a bigger unit (colleagues)
Advice from professionals (e.g. advice on running the ‘business’)
|Invoices, administration, etc. |
Social security as employees (taxes, pensions, sick pay)
Efforts concerning work health
Part of a bigger unit (colleagues)
Advice from professionals (e.g. legal advice)
Education and training
|Employment status for freelancers||Permanently employed in particularly independent position||General fixed-term|
|Role of trade unions and collective agreements||None||Very moderate|
More than any other group of workers, practitioners in the artistic, cultural and creative sectors tend to be either self-employed or contracted-in”Ikke ansatt lønnstaker”, i.e. a person who receives payment for individual assignments without being a permanent or temporary employee of the organisation he or she is carrying out work for (NAV 2020c).. This is not a new phenomenon within these sectors, and this type of labour market affiliation will be a natural choice for those who choose a career where the opportunities for permanent employment are slim or non-existent. Data from the Norwegian Labour Force Survey (LFS) show that the Arts, Entertainment and Recreation sector has a high proportion of self-employed workers as well as many employees on small part-time contracts (Jesnes & Nergaard 2019; Nergaard 2020a (chapter 5 in this report)). A survey among professional artists found that approximately 75 per cent of the individuals in the sample had registered for self-employment, i.e. had registered a sole proprietorship (Heian et al. 2015). According to the trade unions for actors, professional dancers and musicians, their members often combine different types of affiliations (Jesnes & Nergaard 2019). Several performing arts organisations report that over the years, the number of permanent jobs in their sector has decreased and that many employers and contracting bodies wish to utilise the services of self-employed practitioners rather than hiring permanent or temporary staff (Jesnes & Nergaard 2019).
The case company was established in 2011 when a number of self-employed freelancers in the music industry found that running a one-person business as a sole proprietor presented them with numerous challenges. Therefore, they wanted to find a model that would provide greater security, less administrative work and cheaper services for freelancers. The solution was the formation of a company that employs freelancers, i.e. people who used to run their own business and who take on contracts or sell their services. The company grew fast, and today (2020) it employs approximately 125 freelancers spread around the country. There are six managers and administrative staff, but these make up fewer full-time equivalents.
The company is currently “one of a kind” in the Norwegian labour market. A few other companies advertise that they offer more or less the same services to freelancers, but these are small when it comes to turnover and employees in Norway. The case company stands out due to its size as well as its ambition to be an alternative for people who want to work as a freelancer long term. In 2019, the total turnover was NOK 54 million. The company is organised as a private limited company and is largely owned by its founders. Their aim is for the company to grow organically, based on a good reputation.
The majority of the freelancers employed by the company work in music, sound and lighting, but other professionals are welcome to apply for employment as well. Their average age is 38 and the freelancers often have many years’ experience within their field. They typically work full time with their artistic/creative activities, though some hold more than one job. For example, they may combine working for the company (i.e. as a freelancer) with a part-time job in a municipal school of music and performing arts or similar institution.
The company promotes its concept to freelancers through an open website advertisement. Potential candidates for the positions are interviewed and it is estimated that approximately two-thirds of the applicants are accepted for employment. The company stresses that their employees are their representatives, and they are therefore looking for professionals within their field who maintain a high standard and enjoy a good reputation. The objective of this policy is also to ensure that the employed freelancers benefit from employment by the company, which means, among other things, that their turnover will have to be at a certain level (more or less full-time work).
The company’s margins are small, and it is considered important to keep costs as low as possible. They have also set a maximum profit limit of two per cent. Profit above this level is paid out as a bonus to the employees. A bonus was paid out in 2018.
The company’s premises include office space and meeting rooms which are available for hire to employees, and staff can meet up for lunch or other social events. They also have a Christmas party and other joint activities.
We interviewed a management representative and three freelancers employed by the company. All three of the freelancers had been self-employed before they joined the company, and they had many years’ experience within their own disciplines. Two of the three also had many years’ experience of self-employment, while the third interviewee was taken on as an employee of the company reasonably soon after finishing his education. In addition, we interviewed a number of organisations for artists, as well as in one interest organisation that represents employers.
|No. 1||General manager.|
|No. 2||Freelance employee. Worked as a musician for more than 20 years. Used to run a sole proprietorship.|
|No. 3||Freelance employee. Works within consultancy. Ran a sole proprietorship for many years.|
|No. 4||Freelance employee. Music-related work. Combines work for the freelance company with a permanent part-time job. Ran a sole proprietorship for a few years before joining the freelance company.|
Those who are hired by the company are offered a permanent job (open-ended contract), which entitles them to sick pay, holiday pay, occupational pension scheme enrolment, etc. There is also an option for a fixed-term contract, but this category is not in useWe have not looked into the employment contracts of administrative staff.. The freelancers’ position is explicitly defined as being “particularly independent posts”, which mean that they are exempt from most of the working time regulations. Employment by the company does not come with a guaranteed income. The wages paid out to the freelancers are determined by their number of contracts and the rates of pay that they charge/are offered. Consequently, employment does not protect against fluctuating workloads or low prices.
The company describes their offer in these terms:
Employees bring in their own contracts. The company takes a share of the invoiced amount to cover their costs (a share of the income, 7.5 per cent of the profit, plus a set amount per month). The remainder is paid out as wages (net of income taxes, the obligatory national insurance contribution and the occupational pension scheme contribution). The fee payable to the company covers administrative costs, collective insurance policies etc.
Employees enter the details of their own contracts and expenses into the company’s IT system. As a rule, the company does not review the contracts. Contracts of a certain size are subject to approval, but none of the freelancers interviewed had come across any such cases. Employees have their own account in the system, which provides an overview of recorded contracts and other functionalities. Invoices under each contract are issued by the company, which also handles VAT issues.
The freelancers are paid a monthly wage based on the contracts they have invoiced, and they are taxed as wage earners. If the income is predictable, but fluctuates over a period, it is possible to have wages paid out in reasonably even monthly tranches. However, this is not the norm and none of the freelancers interviewed referred to this option.
The company has a health and safety representative, a working environment committee and whistleblowing procedures as required by law. The company also has routines for conducting appraisal interviews. The case interviews give a general impression that the freelancers are fairly unfamiliar with these arrangements. They are generally acquainted with the fact that there is a health and safety representative or a contact person, and state that they are aware of their opportunity to contact this person. However, none of them have ever contacted the health and safety representative/working environment committee. The concept of a “performance assessment interview” is also unfamiliar to the interviewed freelancers, although they report that they attend meetings with their named contact about how things are going.
The company organises social events such as Christmas parties and other get-togethers. Those who find themselves in the vicinity of the company’s main office can drop by for lunch, a chat or to attend other social gatherings. The importance attached to this aspect varies. While one of the interviewees points to a sense of community as one of the most important benefits of being affiliated with the company, this is less important to others. Nevertheless, they point out that the company employs a large number of people who work in music, sound and lighting. It is therefore possible to pick up contacts and establish collaborative partnerships through networking and in-house channels.
There is no trade union representation in the company, nor is there a collective wage agreement. The company is not a member of any employers’ organisation. Neither the management nor the employees believe that there is a need for this. One of the freelancers reflected as follows:
When the freelancers were asked what they would do if they were unhappy with anything, they all answered that they would get in touch with their primary contact person among the administrative staff. Employees are also represented on the company board.
All three freelancers interviewed reported that working as freelancers – finding their own work – was their own active choice. None of them wanted permanent employment in the traditional sense, but they were aware of the challenges involved with self-employment. One of the three pointed out that the choice to join the freelancer company had resulted in a lower income, but the other two did not refer to this as a specific challenge. They were more concerned with having the freedom to choose their own contracts and they were not looking for assistance with securing contracts or negotiating fees or other terms and conditions.
The freelancers we interviewed had all been self-employed before joining the company. The reasons that each of them cited for going from self-employment to employment by the company share many common features. They refer to being relieved of administrative work, such as bookkeeping, and making sure that money is set aside for the pre-payment of tax and VAT. Additionally, all three stressed the benefits of being an employee, such as the entitlement to sick pay. They also stated that their insurance policies are better and cheaper than the policies that would have been available to them on their own.
Two of the three freelancers – those with the longest experience of self-employment – also referred to the demands of keeping your own accounts and keeping track of income and expenses throughout the year:
The interviewees also pointed out that finding the time for administrative tasks can be challenging if you are running a sole proprietorship. Some put it off, and consequently end up in a muddle. All three agreed that the company has made it simple for them to carry out administrative tasks. It is easy to record work that needs to be invoiced and expenses that need to be reimbursed. They each have a named contact person and can ask for advice as necessary. Another advantage compared to the situation before they joined the freelancer company is that their wages are paid out once a month. Wages are paid out even if the payment for a contract has yet to arrive in the company’s account. The freelancers are also protected from the risk of bad debtors. However, the latter appears not to have been a problem for our interviewees. The freelancers emphasise that the company’s regulatory competence is good, including the fact that they know the industry well (music, sound, etc.).
None of the informants saw themselves as employees in the ordinary sense. In their view, they continue to run their own businesses like before, but they are doing so within a model that provides greater protection and relieves them of most of the administrative tasks they used to do. All of them point out that they are in control of their own artistic-creative practice. They negotiate their own fees and decide which jobs to accept.
All three freelancers report that they were initially concerned about the cost of company affiliation, i.e. the percentage of their revenue that would go to the company. The fact that they no longer receive their full fee is an aspect that fuels scepticism among their peers who have decided not to seek employment with the freelance company. Moreover, the tax regulations that apply to employees differ from those that apply to the self-employed. Employees pay, among others, a higher rate to the national insurance contributions compared to self-employed individuals. However, the company’s management as well as the freelancers they employ (the interviewees) believe that ultimately, they are not any worse off as wage-earners, and the freelancers also mention that they would otherwise have to pay for insurance, bookkeeping (or spend time doing it themselves) etc. None of the three freelancers interviewed had considered going back to their former type of labour market affiliation on the grounds of cost.
All three freelancers were introduced to the case company through their personal acquaintance with one of the company founders, or they knew others who were associated with the company. The website presentation had been particularly significant for one of the interviewees. They emphasised that knowing the people who were behind the company contributed to its credibility.
The issues in this case study are associated with how freelancers can organise their own practice in an alternative way to avoid some of the challenges that come with being self-employed, while still retaining the freedom in their work. Employment by the freelance company affords the freelancers greater protection in that they are given access to insurance products and the social security that employees have, such as sick pay. The freelancers we interviewed also stress that this is a better way to run a freelance business, in that the administrative workload is eased, the risk of making mistakes is minimised, social security is better, and making contributions to a pension scheme is a mandatory priority that cannot be postponed. The weight freelancers put on the social aspect of employment varies.
However, this type of employment does not resolve any challenges associated with income insecurity or a shortage of contracts, because the wages are linked to each individual’s volume of contracts. Furthermore, the individual freelancers still negotiate their own rates of pay, and being affiliated with the company does not provide collective bargaining strength with clients. Our interviews do not suggest that the employed freelancers have a wish for the company to take on these tasks.
This type of labour market affiliation has been tailored to suit established freelancers with a fairly stable portfolio of contracts, who wish to continue to work as freelancers (i.e. taking on contracts). Therefore, the arrangement’s generalisability is limited with respect to groups whose challenges centre on fluctuating volumes of work or clients with a low willingness to pay. Neither will the arrangement resolve any challenges associated with “bogus self-employment”, i.e. concerns over the type of labour market affiliation that should exist between worker and employer.
One question is the degree to which the company, or similar companies, could exist in any other sector. All of our interviewees believed that this was a concept that might also be suitable for other groups of freelancers. However, there are some prerequisites. The freelancers need a certain level of turnover for the concept to make financial sense for the individual practitioner and for the company to accept the risk of employment. Furthermore, all revenue is based on income from work. The implication is that this is an organisational form which is suitable for full-time freelancers with a relatively stable income who wish to enjoy the freedom of freelancing without having to accept the administrative workload that comes with running their own business, and who also want the social security aspects of being an employee.
Freelance companies appeared in Sweden already in the early 1990s. Since around 2010, the number of solo self-employed workers has been rapidly increasing (see Berglund et al. 2020, chapter 3 in this report, also Futurion 2017:1; van Stel et al. 2014). This development is in line with the growth of the contractual labour market that has expanded since the turn of the millennium. Moreover, the rise in self-employment and freelance employees was enabled by a new law in 2006, allowing for temporary contracts, and a tax reform in 2009 which opened up the possibility for assignment workers to have only one customer. In 2013, member companies of the trade organisation for freelance companies (EB) provided services for the vast majority of all freelance employees in Sweden (Bjerke & Pettersson 2013). According to representatives from the business, the increase in freelance employees also resulted from the expansion and marketing efforts of the freelance companies themselves. However, a caveat to this observation of a rapid increase is that – since this category is still not clearly defined – different measuring methods will report different figures for the size of this group (Futurion 2017:1).
Swedish freelance companies appear in different forms. They may take the form of platform work, and many platforms use freelance companies “as middlemen” (Westregård 2019a). Several of the freelance companies are also run as social companies, offering various opportunities for participation in the company, and with an ambition to integrate people that are currently excluded from the labour market. However, many freelance companies mainly function as invoicing services and take no employer responsibilities. It should be noted, though, that some of the unions also provide this kind of invoicing service, for instance Teaterförbundet (The Sweden Union for Performing Arts and Film).
General statistics provided by the trade organisation also show that the average age of freelance employees is 36, and that there are somewhat more men than women – which is in accordance with the gender differences among solo entrepreneursAccording to the trade organisations’ statistics, 35 per cent of the self-employed workers in the company are women, 49 per cent are men and 16 per cent are unclassified. The percentage of women among solo entrepreneurs is 37 per cent (SCB 2020: Egna företagare 16+ (dagbefolkning) år 2018 efter kön).. In addition, a report published in 2012 claimed that 45 per cent of self-employed workers earned their living by combining income from employment and from their own business, while 38 per cent were fully supported by their self-employment (Arvas 2012).
This case study is based on interviews with four representatives from one of the freelance companies: the general manager, two administrators employed on open-ended contracts, and one of their former freelance employees (table 9.4). In addition, their views are complemented by the opinions and perspectives of three more interviewees: one representative of the trade organisation (EB), one representative of a union within the creative sector, and one representative from one of the larger Swedish unions. The case company is a small-scale, Swedish business that has provided financial advice services to all kinds of companies, i.e. not only freelance employees, for 20 years. They profile their services by providing a personal contact and aspiring to help their customers/freelance employees with “all kinds of problems”.
|No 5||General manager. Has worked with freelance employees for 23 years. One of the founders of the business organisation.|
|No 6||Administrator, employed on an open-ended contract for less than a year. Works with finance, bookkeeping and marketing.|
|No 7||Administrator, employed on an open-ended contract for 6 years. Works with bookkeeping and invoicing for the freelance employees.|
|No 8||Former freelance employee. Employed by the case company for 3 years. During this period, he has also had his own employees. Is currently self-employed with-in the transport sector and has 18 employees/subcontractors on temporary contracts.|
Employment for freelancers is one of the services offered by the company, described as an option for those who do not want, do not know how, or are not allowed to run their own business. Against a monthly fee (for those with regular orders) and a specified percentage of all revenue,The fee is presented through an individual offer, and the company provides no general information on the cost. For similar companies, the percentage cost lies between 4 per cent and 10 per cent. the company administers billing, tax payments and reductionsA deduction for the labour cost for jobs classified as ROT (Repairs, Conversion, Extension) or RUT (Cleaning, Maintenance and Laundry)., accounting, and finally pays out a “salary” to the freelance employee. Additional services, such as marketing, legal advice or training courses, are provided against additional costs. The company is a member of the trade organisation (EB) for freelance companies in Sweden, and is thus obligated to take on the full responsibility of an employer.
Four employees on permanent (open-ended) contracts, working part-time by their own choice, are in charge of administration and management. On occasion, and to provide additional services required by its customers, the company uses consultants, for example for legal advice. The number of freelance employees currently hired varies from 30 to 50. According to the general manager, the number is hard to specify since it varies considerably over time. Formally, freelance employees can just as well be hired on permanent contracts. Generally, however, the freelance employees in this case company are hired on a general fixed-term employment (allmän visstid) basis and they typically stay with the company for two years. The general manager explains that this is usually the length of time it takes to start up a company, to clear out possible tax debts, and to require a business tax registration. Notably, the Employment Protection Act (SFS 1982:80) regulates that general fixed-term employment should be converted into an open-ended employment after two years. This should be considered an additional reason why freelancers are not employed by the company for a longer duration.
Like the creative sector, the transport sector is also generally characterised by many self-employed and subcontracted workers, both internationally and in the Nordic countries (Thörnquist 2019). In addition to occupational representation, there are some (sometimes overlapping) characteristics that, according to the case company and the trade organisation, are common among freelance employees at the case company:
The advantages often cited for being a freelance employee generally emphasise the benefit for the individual, but also for the commissioning organisations or for society at large. For instance, it is claimed that self-employment provides a basis for more job opportunities by providing flexibility and lower costs for employers, while additionally helping people to attain permanent positions (e.g. Arvas 2012; Bjerke & Pettersson 2013). In the following, we focus on the arguments raised by the interviewees.
These arguments focus on those who do not know how to run their own business, or who want to test out a concept before fully investing in its realisation. Arvas (2012) describes freelance employment as a “driving school” for entrepreneurs. One of the former employees at the case company similarly talked about his time as a freelance employee as “an education” and that the freelance company functioned as his “school”, teaching and guiding him through every step and thus facilitating his transition to solo entrepreneurship.
The freelance company had previously represented a number of middle-aged women earning an income from the alternative treatments of healing and hypnosis, who had now proceeded to run their own businesses. This is an example of a business idea that may need testing in order for the individual to feel confident enough to make a decision on whether or not to go ahead with it.
Also in this case, freelance employment is described by one of the permanent employees at the company as a springboard:
As this interviewee notes, there are, however, cases when freelance employment does not lead to an independent career.
The company’s ambition is that after a period of employment, the freelancer should either move on to become an independent entrepreneur or abandon such an attempt. However, it may be argued that freelance employment constitutes an alternative to being a solo entrepreneur. The former freelance employee stressed the importance of the social community and support provided by the freelance company. It is emphasised that this constitutes an option for those who have few orders and a very small turnover. In addition, freelance employment is – as expressed in the company’s mission statement – an alternative for those who are not allowed to run their own business, e.g. due to tax debts. Finally, a potential reason would be that in some cases, if you are classified as an employee and not as an entrepreneur, it is easier to be entitled to unemployment insurance. This might be a reason for self-employed individuals to join a freelance company. However, since it still depends on an individual assessment of the person’s status, and on different rules among the various unions, being a freelance employee does not in fact guarantee a right to unemployment insurance.
According to the general manager of the freelance company, a defining characteristic of self-employed workers is that they can perform their work without the constraints of being part a larger hierarchical organisation. This autonomy is also generally stressed as one of the primary motives for being a freelance employee. One of the slogans used for freelance employment is: “Be your own boss, without running a business”. The slogan suggests that as a freelance employee you are free to choose your working hours and your work tasks. You can work with the things you enjoy and on your own terms.
One disadvantage of freelance employment relates to the status of being a temporary employee, which seems to be the contractual form commonly used by freelance companies in Sweden. One of the union representatives argues, for instance, that it is harder for temporary employees to raise criticism and to contribute to organisational development. It also puts those in temporary employment in an uncertain financial position. However, this section focuses on difficulties related to freelance employment more generally.
As mentioned in the introduction, the unclear legal status of this contractual form has led to disputes and different assessments concerning whether freelance employees should be defined as entrepreneurs or employees (also Westregård 2019b). This ambiguity has also been identified in this case study. The freelance company we have studied stresses that its freelancers have the contractual status of employees with the company as their employer. At the same time, on the company website they claim that freelancers, according to the Swedish Employment Agency, are defined as entrepreneurs with the possibility of obtaining financial support at start-upThis information also seems to be outdated. In September 2019, the Employment Agency states on their website that the freelancers have an individual contract with the freelance company which makes it possible for you ‘to work without being employed and without being an entrepreneur’. They however also state that the freelance company has an employer responsibility for the worker, which cannot be guaranteed for all registered companies.. The company itself thereby adds to the confusion about the status of freelance employees.
A recent government report stated that different notions exist among the freelance employees themselves about their own status (SOU 2019:31, p. 196). Some consider themselves as solo entrepreneurs and are aware that they lack the welfare support offered to employees in case of sickness or unemployment. Others conceived their status as that of an employee, entailing the same kind of benefits as any regular employment.
One of the aspects evaluated in order to distinguish between entrepreneurs and employees concerns who is running the financial and commercial risk: the worker or the client (SOU 2019:31, 88). This criterion is especially interesting in relation to the case company, where one of the interviewees claims it to be important that all invoices should be prepared in the name of the freelancer and not the company. This is to ensure that the company does not carry the risk. According to the trade organisation, however, it is the freelance company that should carry the risk.
The unclear status of freelance employees also leads to challenges in relation to the Swedish welfare system, which is designed primarily for employees on permanent contracts. Various unemployment insurance funds [a-kassor], as well as the Social Insurance Authority [Försäkringskassan] have come to opposite conclusions, in different cases, regarding whether the freelance employees are to be considered employees or self-employed individuals (Futurion 2017:1; Westregård 2019b). Although some of the freelancers would like to be members of the insurance fund for small-scale entrepreneurs [Småföretagarnas a-kassa], they have not been allowed to do so. Others have instead applied as employees for membership in the insurance fund of various unions. While some of the unions admit freelancers as members, others do not. The system is claimed to be flawed not only for freelancers, but also for temporary employees and solo entrepreneurs in general. Several of the interviewees stress the need for a system that takes all forms of income into consideration and provides security for everyone.
The case company manager is clear about the company’s responsibilities as an employer. A significant part of the employer responsibility, which the company claims to adhere to, concerns the working environment, including preventive efforts and risk analyses. Here, the company is required to make the freelance employees aware of risks and encourage them to use safety equipment and to follow safety instructions. The manager of the case company cites on-the-job training such as first-aid courses as an example of the company’s efforts to improve the working environment.
Looking at working hours among the freelance employees, the company manager claims that there is considerable variation within the group. Some may have two assignments per year, while some may work 600 hours in three months only to do nothing in the next six months. The freelancer interviewed described how during one period he combined his full-time employment with work as a freelance employee. This involved working weeks of 60–70 hours. Since the work was divided between two employers, however, the long hours did not appear as such. Consequently, neither of the employers had any responsibility or opportunity to record this as overtime.
According to the case company, the variety of occupations represented among the freelance employees makes it difficult to conclude regarding collective agreements on a general basis. As Westregård (2019b: 16) points out, there are no collective agreements at the industrial level to date. Another obstacle, according to the manager, is that the collectively agreed wages are established on very different conditions from those of a freelance employee. While an employed person has a regular monthly income, the freelancer may have periods with a substantially higher income than the collectively agreed level, which is then used for living expenses during the following and intermediate periods with no work or income at all. In cases where an employee has requested it, the company has signed collective agreements with the particular unions and then terminated the membership at the end of the freelancer’s contract. However, in these cases, the wage level of the freelance employees has been excluded from the agreement.
Employment for freelancers offers positive aspects in the form of autonomy and self-determined working conditions. In addition, it potentially functions as a training period, a bridge into solo entrepreneurship. Previous research also argues that freelance employment might offer an opening to a permanent contract with the contracting company. As a counterargument to this, however, the average age of those in temporary employment is relatively high, which indicates that it is hardly a highway to permanent contracts. These potential gains therefore need to be further investigated empirically.
The challenges that are associated with freelance employment concern the unclear legal status and consequent difficulties of fitting into the current welfare system regulations, the vaguely defined employers’ responsibility, and the resulting difficulties for the relationships with trade unions.
For freelance employees in companies that are members of the business organisation (EB), their position could be described as having a social protection – i.e. insurance and pension – but without the income and employment protection. This case study has focused on one of the freelance companies that has willingly shouldered an employer’s responsibility. It is important to keep in mind that this does not count for every company in the business. Here, legislation and regulations that clarify the freelance companies’ responsibilities would be desirable.
As pointed out in the discussion of the changed roles of the parties, a differently organised labour market would involve a number of concomitant changes for e.g. wage-setting procedures and union membership.
In both countries, the companies target freelancers who work on short or long assignments. A common target group is those who do not want to deal with the administration involved in running their own business. However, the groups that are recruited to these companies differ slightly between the two countries. In Sweden, one of the target groups consists of those who want to work as contractors but who lack the formal eligibility to run their own company, since they are not granted a tax certificate. Moreover, there are those who want to try out life as a self-employed person for a period before actually forming their own company. Some of the freelance employees only have a few assignments, while others work full time and perform work within a wide range of occupations: doctors, IT consultants, taxi drivers, culture workers, translators etc. In Norway, the target group is established freelancers who could set up their own company but prefer to have some employee rights, i.e. pension schemes and insurance. Those recruited should be well established in their chosen profession, have relatively good earnings and work almost full time. This means that the company finds its employees from the pool of ‘successful’ freelancers who want the freelance existence in the sense of managing their own work as contractors, and who plan to work as freelancers over time.
In both countries, the companies provide their employed freelancers with two types of services:
The companies do not take on the responsibility for securing assignments, nor do they bear any risk associated with periods without work. In practice, this means that freelancers who are unable to secure their own assignments must find other work. In Sweden, some of the freelance companies have explicitly shouldered employer responsibilities and, in a few instances, also signed collective agreements with the respective union. Generally, the employer has no responsibility for the assignment itself, and therefore has little opportunity to influence working hours or working conditions.
In both countries, the opportunity to “be their own boss” was highlighted as a positive feature and a prerequisite for freelance employment. The main advantage of the employment relationship was less administration, while the security of having social rights as an employee and to some extent also being part of a larger community were also considered beneficial. In the Swedish case, another reason for seeking employment in a freelance company was given as an option for those who are not able or not prepared to run their own business. This was not an issue in the Norwegian case.
Unlike regular employment, employment in these types of companies involves a situation in which the employer has minimal influence over the employment situation and where the employee has no entitlement to wages if they fail to find work. In both countries, therefore, it was necessary to establish a form of affiliation that balances this with applicable legislation on job security. In Norway, freelancers are permanent employees, but hold ‘particularly independent posts’, meaning that most regulations on working time do not apply. In Sweden, freelancers are employed in so-called “general fixed-term” positions, meaning that they are employed only for shorter periods. This appears to be the most striking difference between the Norwegian and the Swedish case and points to different strategies to manage the risk of hiring as well as different business strategies among the companies. Whereas the Norwegian company recruits only established freelancers with a regular income, but hires them on open-ended contracts where the employee regulates her/his own working time and working hours, the Swedish company hires anyone that is interested in their services, but only provides temporary contracts.
In recent years, there has been a focus on the increase in the number of self-employed workers in vulnerable positions in the labour market, e.g. freelancers. In addition, attention has also been drawn to so-called false or bogus self-employment, which is when someone who is registered as self-employed carries out professional activity in such a way that they could or ought to be contracted as an employee (Thörnquist 2019). The grey area between employment and self-employment is likely to be a challenge for the future labour market, particularly if the number of self-employed workers increases. This will especially apply to groups that are in a weak position vis-à-vis their clients and are thus vulnerable to price pressure or poor working conditions, such as many of those who work in the so-called platform economy.
Although freelance companies are beneficial for certain types of freelancers, such companies will (with certain exceptions) neither protect their employees from insufficient or varying workloads nor from poor working conditions. Many of the freelancers’ challenges must therefore be resolved in other arenas, such as through legislative work in the political arena (e.g. through the Employment Protection Act) or by regulatory and praxis work in the institutional arena (e.g. how to categorise and manage freelance employees).
Interest groups, including trade unions, also play a role in securing better conditions for both freelancers with the status as employee and self-employed freelancersEven though there are no formal barriers for the unions to organise solo entrepreneurs, several of the un-ions do not. For instance, the Swedish Municipal Workers’ Union [Kommunal] states that they do not or-ganise solo entrepreneurs since technically they could then become employers themselves (Kommunal 2018a 22).. This can be done through strategic work as well as by providing services for these two groups. For instance, a number of unions in the Nordic countries have opened up their membership to self-employed people without employees and freelancers. A few of these union-led freelancer bureau offer services similar to those provided by the freelance companies. An example is “HK Servicebureau for freelancere”, run by the Danish union HKhttps://www.hk.dk/bureau, which employs the freelancer for the specific contract and offers services such as billing clients (see box 9.1).
Danish trade unions have established two non-profit freelancer companies to address the various challenges often associated with freelance work and solo self-employment. The first union-led freelancer company was established in 1992 by the trade union TL (The Danish Association of Professional Technicians) while HK (The Union of Commercial and Clerical Employees in Denmark) launched its freelancer company in 2018.
Both freelancer companies offer similar services and aim to deal with the challenges associated with underemployment, hybrid work, and the unemployment benefit system, as the solo self-employed often enjoy less coverage due to their status as non-wage earners. The companies also offer services that deal with the administrative tasks associated with freelance work, along with legal advice and guidance regarding their contracts and client relations. They also secure the wages, sick pay, and offer accident insurance by shouldering the employer responsibility and thus granting their affiliated freelancers employee status. While they in principle employ the freelancers, the freelancer company does not have traditional employer responsibilities. The freelancer finds and administers their own projects, while the freelancer company offers various services such as help with tax returns, contract administration, invoices, payments etc. in exchange for a fee, currently 8 per cent of the value of individual contracts or assignments.
Both freelancer companies are non-profit organisations, and although they are union-led initiatives, they are set up as independent companies. There are no restrictions as to the groups of freelancers that can join the freelancer company as they are open to both union and non-union members as well as distinct occupational groups. Registration with the freelancer company is free, and fees are only charged when freelancers use the companies as mediators for new contracts and projects. TL’s freelancer company was initially limited to creative workers and designers like glass blowers, ceramics and visual artists etc., but has since expanded to all types of freelancers and solo self-employed individuals.
Some trade unions in NorwaySee Jesnes and Nergaard 2019 for examples among unions for artists. and SwedenOne example from Sweden is Unionen Egenföretagare, which offers various services created for the solo entrepreneur: https://www.unionen.se/in-english/membership-self-employed. Teaterförbundet [The Sweden Union for Performing Arts and Film] that offers invoicing services for their members. also recruit members among freelancers/self-employed individuals and have developed services specific for this group, for instance invoicing services, or insurance and legal advice (see box 9.2).
The Norwegian Confederation of Trade Unions (LO) established LO Selvstendig (LO Self-employed) in 2017 (LO, n.d.). LO Selvstendig is a co-operative body for unions in LO that organise freelancers or other self-employed people, and offers courses for the self-employed. LO has also strengthened its legal expertise on topics concerning self-employed individuals and negotiated favourable insurance agreements for the self-employed. The establishment of LO Selvstendig shows that LO and the affiliated unions see self-employed individuals as a group they, to a greater extent, want to recruit as members and that LO, as the biggest union confederation in Norway, wants to put issues concerning self-employed individuals and freelancers on the political agenda.
Furthermore, it is reasonable to expect that freelancers in the most precarious situation (small jobs, insecure income, high turnover) will be most difficult to reach. However, given an expected trend with a growing number of freelancers, more unions will have to consider what they can offer to this group.
As illustrated in this chapter, the unclear status of freelance employees involves difficulties in relation to the current organisation of the social security systems. In Iceland, an interesting policy measure regarding solo self-employed/freelancers has been introduced, as pension contributions are made obligatory for all self-employed by law and are deducted via the tax system (see box 9.3). Interestingly, this covers all self-employed regardless of income size or fluctuations.
Self-employed individuals in Iceland face mandatory pension payments. Both employees and self-employed individuals are required to pay a share of their income into a pension fund. However, both groups face a choice into which pension fund to contribute. While the employee covers only the part required of employees (4 per cent), with the employer paying 11.5 per cent, the self-employed individuals contribute both shares for a total of 15.5 per cent. This ensures commensurate rights of both groups to pension benefits.
By: Anna Hedenus & Stine Rasmussen
The eldercare sector in the Nordic countries faces a number of challenges, not least regarding recruitment and retention of qualified personnelSee also NFoW-report Pillar II, which discusses the impact of digitalisation on work in elderly care (Rolandsson et al. 2020, chapter 5).. These challenges are generally handled by using certain forms of non-standard work (NSW) such as part-time work and temporary contracts. This corresponds well with the knowledge from the chapters 3-7, which showed an above-average use of NSW within the health and social care sector, of which eldercare is a part. More detailed statistics on the eldercare sector supports this perspective (see fig. 10.1 and 10.2). This chapter analyses the use and regulation of NSW in the eldercare sector in Sweden and Denmark, reporting main insights from two qualitative case studies in the two countries. In Denmark, the case is a public nursing home, while the case analysed in Sweden is a private company that provides eldercare in about 100 residencies. The Danish case study was conducted by Stine Rasmussen and the Swedish study by Anna Hedenus.
The municipalities administer both Swedish and Danish eldercare. However, service delivery is to some extent privatised in both countries (more about this later). Non-hospitalised care for elderly is provided as home -help services or personal care services to older people living in their own homes or as institutionalised residential care in the form of special housing accommodation: either residential care homes or nursing homes (see table 10.1).
|Percentage of people aged 65 or older living in own home and receiving home-help services or personal care services||11.0||15.7|
|Percentage of people aged 65 or older living in institutionalised residential care||4.7||3.9|
In both countries, eldercare is publicly funded, while service delivery is increasingly privatised. In Denmark, eldercare is mainly free of charge, while people living in care homes pay rent and for certain non-care-related services (for instance meal delivery and cleaning) (Nordens Velfærdscenter 2015:13). In Sweden, the elderly pay a means-tested fee for care, but with a cap set at 2,125 SEK per month. In addition, in Sweden, people living in special housing accommodation need to pay for meals and rent. To make eldercare affordable for everyone, elderly with lower income can apply for financial support and/or reduced charges.
Both countries spend a comparatively large percentage of their national GDP on eldercare (2.2 per cent in Denmark and 1.9 per cent in Sweden in 2016)https://ec.europa.eu/eurostat/statistics-explained/images/2/24/Expenditure_on_care_for_the_elderly%2C_2016_%28%25_of_GDP%29.png and employ a significant number of people (around 200,000 in Sweden and 100,000 in Denmark). The number of employees is increasing in Sweden yet decreasing slightly in Denmark (FOA 2017a; SKR 2020a:45; SKR 2020c: 51f). The main job categories are nurses, nursing assistants and different types of caring staff.
Because of the economic recession and strained financial situation throughout the 1990s, many municipalities set out to contain costs and find new forms of organisation (Stolt et al. 2011). This involved, for instance, the introduction of New Public Management in the sector, de-institutionalisation and privatisation. In both Denmark and Sweden, the municipalities’ ambitions also led to the application of more restrictive eligibility criteria for care services, with the consequence that more people were offered home care rather than institutionalised care and that they in general received less care (Strandell 2020). In addition, many municipalities have opted for outsourcing of home help and personal care services to private providers. In Sweden, 36 per cent of municipalities used private providers and 14 per cent of special housing accommodations were operated by private contractors in 2008 (Stolt & Winblad 2009)Privatisation as either care provided by voluntary, non-profit organisations, or as a transfer of publicly funded to privately financed elderly care, are still uncommon in Sweden.. In Denmark, 35 per cent of all home care recipients opted for a private provider in 2017Since 2003, there has been a principle on free choice of service provider within home care, and the municipalities are by law obligated to offer an alternative to public home care. (Sundheds- & Ældreministeriet 2019). Privatisation is less widespread for elderly living in nursing homes – less than 1 per cent in 2014 (Rostgaard 2014). To some extent, the provision of eldercare has thus shifted from the welfare state towards private providers and the family.
In both countries, the changes during the 1990s and onwards were associated with significant quality differences. In Sweden, home care workers experienced an increased workload, reduced job autonomy and support, as well as an accumulation of work‐related problems (Stolt et al. 2011). Moreover, private care providers offer lower pay and fewer full-time and permanent positions in Sweden (Kommunal 2018b), and employees in private care spent more hours on unpaid work and were less satisfied with their work, compared to employees in public eldercare. Research from Denmark comparing working conditions among employees in private and public home care shows that employees in private home care have less experience, fewer formal qualifications, less favourable working conditions and report more stress-related issues compared to employees in public home care (Rostgaard 2017).
In both countries, the sector has severe difficulties in terms of recruiting and retaining sufficient and competent personnel. In Sweden, there are large differences regarding care givers’ relevant education – varying from 40 to 100 per cent – between municipalities for those employed in special housing (Socialstyrelsen 2018:48). According to Swedish union representatives, a third of those who graduate from the Health and Care Programme at upper secondary school in Sweden move on to higher education after only a few years in care work. During the last 4-5 years in Denmark, it has been difficult to recruit nurses and social and health care assistants to the eldercare sector (Sundheds- & Ældreministeriet 2019). Since 2010, there has been a significant decline in the number of people who start training as social health care helper or assistant, and the dropout rate is above average compared to vocational education in general (Finansministeriet et al. 2018). Moreover, due to the increasing number of elderly people in need of care, the need to recruit and retain even more employees will only continue to grow in future (FOA 2019; SKR 2020c). Currently, as we will also see in the two case studies, this challenge is mainly dealt with by using different forms of flexible NSW.
In both countries, the most commonly used forms of NSW in eldercare are part-time contracts and various forms of temporary employment (Box 10.1).
Part-time employment: monthly fixed wage with a weekly working time less than full-time employment.
Fixed-term employment: a contract of limited duration with a fixed monthly salary. Can be both full-time and part-time. In Sweden there is a distinction between different types of fixed-term contracts. For instance general fixed-term contracts (almän visstid), where the employer does not have to give a reason for employing on a temporary basis, temporary substitute employment (vikariat) and seasonal employment (säsongarbete).
On-call workers: A very short type of temporary contract where pay is received per hour instead of a fixed monthly wage. No minimum or maximum number of weekly hours guaranteed. ‘Tilkaldevikarer’ or ‘timelønsansatte’ in Danish. ‘Timanställda’ or ‘Vid behovs-anställda’ in Swedish. In Sweden on call-work is categorised as a general fixed-term contract.
In Sweden, around 60 per cent of the employees in the eldercare sector have a full-time contract, which is less than the average for the municipal sector as such (SKR 2020a:38). Permanent employment still constitutes the majority of all employment in the sector, but fixed-term contracts for both long and short periods of time are common, as is on-call work (fig. 10.1). For certain job categories, temporary employment is quite widespread. In 2015, more than 60 per cent of the care assistants were employed on fixed-term contracts, while the lowest share in the sector was found among the assistant nurses (Kommunal 2016a:16).
The difficulty of attaining a permanent contract in Sweden is, by many, perceived as a problem. Union representatives claim that 70 per cent of employees on fixed-term contracts would like to have an open-ended contract. Moreover, as it takes a long time particularly for on-call workers to reach the qualification time, the fixed-term contracts are seldom converted into permanent contracts and many work on a succession of short-term contracts for more than three years, according to interviewees from both the union and the employers’ organisation (see also Westregård 2019a:22; Kommunal 2013). Furthermore, for on-call workers there are no regulations on minimum duration or number of working hours, and theoretically, a contract could be for as little as one hour (Westregård 2019a: 21f). Consequently, the employee has an absolute minimum of job security.
In Denmark, employees in eldercare are more likely to draw on a combination of long part-time employment and temporary contracts. Most social and health care personnel working in the Danish municipal sector are employed part-time, while full-time employment accounts for only around 10 per cent in eldercare in 2019) (fig. 10.2). As in Sweden, part-time employment is also most widespread within certain job categories in the sector, for instance more for the social and health care workers than for nurses (Finansministeriet et al 2018:16). Most part-time employees work between 28 and 36 hours per week, while short part-time (defined as 0-19 hours per week in the report) is more common among unskilled personnel who are also more often hired for on-call work and on fixed-term contracts (Finansministeriet et al 2018:17).
Moreover, new actors such as digital care platforms, i.e. care.com, have recently started to emerge in the Danish and Swedish care market. Although the platforms are marginal players at the time of writing (SKR 2020d), they may represent a challenge for the labour market models in that they often operate without coverage from existing labour market regulation.
In both countries, wage and working conditions for care workers are regulated through collective agreements. Regarding publicly procured care work, labour clauses typically apply and request private contractors to follow the most dominant collective agreements within the private care sector. This also applies to temporary workers.
Table 10.2 provides an overview of the Swedish and Danish unions and employers’ organisations that are currently most dominant in negotiating terms of workers in the eldercare sector. The collective bargaining system still holds a strong position in the two countries. In 2015, 100 per cent of the Swedish public employers and over 90 per cent of private employers in the care sector had signed collective agreements for their blue-collar workers (Kjellberg 2017: 32). The union membership numbers among care workers have decreased since the end of the 1990s, but it is still one of the sectors with the highest membership proportions. As reported by LO (The Swedish Trade Union Confederation), 72 per cent of the employees working within health and care in 2018 were members of a union (LO 2018). In Denmark, the collective agreement coverage is nearly 100 per cent in the public sector, though estimated to be considerably lower in the private sector. Recent figures indicate that the union density among care workers is 75 per cent in the public sector and 68 per cent in the private sector in 2015, but somewhat lower among marginal part-time workers (58 per cent in the private and 59 per cent in the public sector) (Mailand & Larsen 2020:32).
|Unions||Employers’ organisa-tions||Unions||Employers’ organisa-tions|
|LO: “Kommunal” (The Swedish Munic-ipal Workers’ Union)||SKR (The Swedish Association of Local Authorities and Re-gions)||FOA - Trade and Labour||KL (Local Govern-ment Denmark)|
|OFR: Vårdförbundet (representing e.g. nurses)||Sobona (Employers in municipal companies)||3F-PSHR (Care workers in private sector)||Danish Industries, Danish Chamber of Commerce (Dansk Erhverv)|
|Vårdföretagarna ( Employers in privately managed care)|
As described in the introduction, privatisation of service delivery is one of the main developments that has had a large effect on the eldercare sector during the last decades. While motivated by a strive for higher quality and cost efficiency, privatisation is often criticised for resulting in the opposite. For that reason, a private contractor was chosen for the Swedish case study, and in Denmark, a public care home with a quite extensive use of NSW was chosen. 11 interviews have been conducted in these two cases (four in Sweden and seven in Denmark). In addition, the two country cases include interviews with 10 social partner representatives from relevant unions and employers’ associations etc.: in Denmark, representatives from FOA, 3F, KL, Danish Industries as well as the non-for profit organisation the DaneAge Association (Ældresagen) were interviewed, while in Sweden, we interviewed one representative from a Swedish employers’ organisation and three representatives from one of the relevant unions. The case studies explore and illustrate trends that have previously been mapped quantitatively, yet seldom by qualitative methods.
|Public/Private||Private, part of a Nordic business group.||Public care home|
|Form of elderly care provided||Home-help and residential care incl. nursing homes and short-term homes used for respite care||Practical and personal help for residents at the care home.|
|Total number of em-ployees||20,000||100|
|On-call workers||Included in temporary contracts||1–50% depending on the season|
|Full-time||50% <||5% <|
The case company provides eldercare in the form of home nursing in about 100 residencies, and is part of a Nordic business group with close to 20,000 employees. The residencies include nursing homes for dependent older people as well as for younger patients with dementia and short-term homes used for respite care. The care services involve a wide range of tasks varying from medical assistance and nursing to help with clothing, personal hygiene, meals and medications, transport and physical activity, or just providing a social context and personal contacts. The management collaborates with the union on both a local and central level. On a local level, the shop steward mediates between management and employees.
The interviewees are presented in table 10.4. The company’s HR specialists assisted in arranging the four interviewsIn contacting the company through management, we are likely to have some selection bias. There are no voices heard representing the nurses, the youth workers or the full-time employees, in addition to employees perceived to be harder to approach, i.e. on-call workers who have only been hired for very few hours, or employees that are highly critical to management or working conditions..
|Business area manager||Executive management program||Business area manager for the last 7 years, worked with management within the care sector for more than 20 years.|
|HR manager||HR education||HR manager for the Swedish branch for the last two years. Has previously been working with labour law and has an interest in challenges in NSW.|
|Part-time worker (involuntary part-time) |
|Nursing assistant||Employed for 21 years at the company. Shop steward and safety representative for the last two years. Employed on part-time (28 hrs/week) open-ended contract. Recently secured more hours in the contract.|
|Unskilled||Employed for a few months. Is currently studying to become a nursing assistant. Works weekends and evenings.|
Over 50 per cent of the employees are contracted for at least 35 hours per week, and only 3 per cent work short part-time (less than 20 hours/week) (table 10.3). Company statistics show that employees aged 30 to 40 are more commonly working part-time, presumably due to parental part-timeWorkers with children under the age of 8 years have a statutory right to work part-time, see more in Chapter 3.. In addition, part-time employees include people who supplement income from other part-time jobs or want to combine work with studies.
From the employers’ perspective, involuntary part-time appears to be a difficult issue to resolve. The employer seldom offers full-time work, and 30 hours per week is perceived as the standard number of hours (which however does not correspond with the statistics provided by the employer). Employees wanting to work longer hours can apply for an increase and then “queue” for such an opportunity. This means that when there is an opening for a full-time position or a position with longer hours, this position is first offered to the employee who is “first in line”.As regulated by the Employment Protection Act (SFS 1982:80, 25a §, 1st section), part-time employees have since 1996 had a legally regulated precedency to vacant positions with longer hours. This precedency requires, however, that the employee has previously voiced her/his interest in extended hours, which this queue system seems to facilitate.
More than half of the employees at the company work in temporary contracts (table 10.3). The high number of temporary employees should, as argued by the HR manager, be interpreted with care, since it contains fixed-term contracts as well as on-call workers that might only have worked a few hours. Temporary contracts are thus used for covers during both longer and shorter contractual periods and for on-call workers and self-employed contractors (for instance doctors and nursesPrimarily nurses and assistant nurses are hired as agency workers, while doctors more often work as self-employed contractors (Kommunal 2018b:13).), who are employed only for shorter periods. The temporary employment is also often in the form of a part-time employment.
The number of temporary employees in the company includes many on-call workers. Students, new graduates and newly arrived immigrants (who often are students) are groups that are more often working on-call. These groups are working for income but also for work experience. Among the on-call workers, we also find the newly retired and people who have voluntarily been working on a succession of short, fixed-term contracts for a longer period of time. The latter group often have an additional employment or occupation.
The main contractual form used for on-call hourly work [tim- eller behovsanställning] is general fixed-term employment, where each scheduled work shift constitutes a new employment. As stressed by the union, Kommunal (2016b), this is the most uncertain contractual form among the various options for fixed-term contracts. Although on-call work is regulated in some collective agreements, much room is given to different interpretations of the legal framework. For instance, it is unclear if an on-call worker has the right to extra pay for overtime. In order for an employee to be compensated for working overtime, the overtime has to be ordered by a manager. On-call workers cannot formally be ordered to work overtime. Moreover, if the contract does not state a standard length of full-time work [heltidsmått], it is difficult to define overtime. This kind of conflict has been debated between the union and the employers’ organisation at a central level, but has, to date, not been taken to court by any of the involved parties. The on-call workers do not want to risk losing job opportunities and the employers try to avoid having on-call workers working overtime.
Both employees and management of the company describe that employees wish for permanent contracts and longer hours (not necessarily full-time), to a higher extent than the employer can provide. The Business area manager claims that they always try to offer permanent contracts to “good temps” when there is a vacancy somewhere in the company. The HR manager also states that they generally strive to convert temporary jobs into permanent contracts after two years, rather than after three years when they may be pushed by the lawAccording to §5a in the Employment Protection Act (1982:80) both general temporary employment and substitute employment should be converted into an open-ended contract when the worker has been employed for more than two years during a 5-year period. In addition, some collective agreements regulate that the total length of employment, if combining contractual forms, should never exceed three years before conversion. Such agreements stipulate that temporary contracts should be converted into open-ended contracts when you have been working for a total of 1081 occasions/days (Kommunal 2020b).. One of the employees also corroborates this statement that many temporary employments are converted into open-ended contracts.
For substitute nurses, however, a temporary work agency within the same business group provides the extra staff. These nurses are temporarily stationed at the specific company but may still have a permanent job contract with the agency.
The company also takes part in various programmes established by the Employment AgencyThe current program referred to here is the so called extra-services: https://arbetsformedlingen.se/for-arbetssokande/stod-och-ersattning/stod-a-o/Extratjanst, aiming to provide job experience for newly arrived immigrants and long-term unemployed people. These job – referred to by the Business Area Manager as “extra” jobs – are used primarily as a back-up at meals, and for social contact. For social contact and for activities presented as “entertainment”, the company also buys services from another company providing jobs for youths on weekends and holidays. As these employments are subsidised, they provide the company with low-cost labour that also involve a high level of flexibility for the employer.
Hiring with the help of platform services has been discussed at the company, but the management perceive that this would involve too high a loss of control and supervision of working hours.
The extensive and increasing needs in eldercare continue to be a main challenge for the sector, due to the difficulty of recruiting enough qualified employees along with tight budgets. The interviewed managers assert that they would happily meet the demand for full-time employment voiced by the union and employees, if not for the costs involved.
This section presents the accounts and challenges of using NSW (table 10.5). It should be stressed, however, that the presentation of employees’ rationales mainly stems from the interviews with the employer representatives, and some of the accounts, i.e. regarding employees’ autonomy and unwillingness to commit to single employers, were not voiced in the employee interviews.
|Covering needs at all hours|
|Managing uneven workload during days and nights||Autonomy to choose employment contract, work hours, and other working conditions|
|Having a pool of on-call workers||Hours available for temps, solidary sharing of work hours||Difficulty to attain full-time and open-ended contract|
|Following the Working Time Act|
|Attract new personnel with a variety of contracts||Continuity||No commitment to single employer|
|Competence and knowledge development|
|Allowing for care takers to recognise the care-givers|
The tasks of the organisation require jobs that are staffed at all hours, all days. Generally, eldercare is organised in an optimised way [precisionsbemanning], having as few personnel as possible during the calm periods of the day and more personnel during the more intensive hours, i.e. mornings and meals. Flexible employment facilitates such planning by providing personnel that only work a few hours a day, part-time workers who can share the work day between them, or working split shiftsA split shift is a work turn that includes an unpaid break that is longer than a regular break, i.e. 60 minutes..
An individual employee is only allowed to be on-call duty for 50 hours each month (i.e. 40 hours per week as ordinary hours plus <50 hours on-call per month). If you have four employees working full time, the organisation can plan for 200 hours of on-call duty. If, instead, there are six people working part-time, the organisation has 300 hours of on-call duty to use.
Scheduling personnel around work peaks of the day while also attaining the flexibility provided by on-call workers is said to be harder when using full-time workers, without violating the Working Time Act (SFS 1982:673) (see Box 10.2). Part-time and short-term contracts make it easier to act in accordance with the Working Time Act and are thus presented as essential for care companies, regions and municipalities relying on the optimised model for organising work (Alkhaffaji 2018).
From the employers’ perspective, it is also advantageous to have a pool of potential workers who are able to take on-call and substitute jobs at short notice. The use of short-term contracts thus helps keeping on-call workers at hand in the organisation. In addition, offering hours is described as a good deed for the temps, in providing them with work and income.
The main challenge with this system for employers is to balance flexibility and continuity, i.e. to ensure that employees’ competence and knowledge are kept and developed, and to allow for care users to recognise the caregivers that visit them.
The Business Area Manager stresses that short-term employment offers the employee a higher degree of autonomy as they are free to choose the employment contracts, work hours and other working conditions, and even describes it as the on-call workers’ market, i.e. that they have the option to turn down job offers. The manager interviewee presents this as a generational difference, where the younger generation does not want to commit themselves to one particular job and employer, especially not when it is easy to get a job:
Here, the employer representatives present it as both necessary and fully possible for employers to attend to the needs of both groups, i.e. those wanting part-time, short-term contracts; and those aspiring for full-time, long-term employment.
Although unusual, the employer interviewees have experienced fixed-term employees turning down the opportunity for an open-ended contract. This primarily concerns people holding another job, retirees and students who want the freedom to be able to say no to shifts.
Being able to offer a variety of contracts is thus presented as necessary to attract new personnel. However, it is a challenge to foresee what types of contracts future work generations will prefer. The HR manager sketches two possible developments: 1) more open-ended contracts, to attract employees; 2) more on-call workers and short-term, fixed contracts, to provide employees with flexibility. The employers, she argues, need to be prepared to face both of these needs:
According to the HR manager, however, it will not be possible to offer only full-time, permanent contracts, due to the variable needs for staff.
From the employees’ perspective, where the difficulty to attain full-time, open-ended contracts is highlighted as a main challenge, part-time work and the sharing of hours it involves can rather be presented as an act of solidarity. One of the employees interviewed argues that it is better that a large number of people are offered jobs on few hours compared to only a few working many hours.
Employment contracts have implications for wages, working hours and working conditions. Yet so do also the solutions for organising work. To manage a lack of competent personnel and insufficient resources, employers find various creative ways to hire employees to cover the wide range of working tasks. Optimal organisation and split shifts are among these strategies, along with differentiation of work tasks. This section illustrates some of the implications of such strategies.
Starting with the matter of differentiation of work tasks, the case company has started to recruit workers in a new position as service assistants. This position requires less education than nurse assistants and involves less care-related work tasks. Their use of subcontracted youth workers also reflects this differentiation of work tasks. In response to a question why these work tasks – playing games and music, baking, going for a walk – are not conducted by the regular employees instead, the Business Area Manager states that these tasks should not be considered “genuine” work tasks related to care, but rather as “entertainment”.
The unions have criticised the fact that the introduction of service assistants involves a pay reduction for those who have previously been paid as nurse assistants. Employers argue that the increased differentiation should not be associated with wage dumping, since they do not pay less than what is established in collective agreements. However, for employees previously paid above the minimum wage level, salaries could be reduced if their job content is altered. A more likely scenario is wage stagnation, due to the shortage of skilled labour.
NSW may negatively affect individuals’ income in other ways. For instance, the individual’s retirement funds are based on a percentage of monthly earnings and will thus be lower for short-term and part-time employment. Moreover, temporary workers sometimes lack access to unemployment benefits. This is the case for workers whose employment is arranged and subsidised by the Swedish Employment Agency.
Several part-time employees wish to increase working hours, to which end the company uses a “waiting queue”. However, a team of only full-time workers poses other challenges such as restraining management to schedule according to employees’ satisfaction:
The challenges involved in offering sufficient hours to the part-time workers also apply to on-call workers. However, for this group there is an additional challenge in restraining the total number of hours worked when combining shifts in different departments or workplaces. Among on-call workers, multiple job holding is widespread (Kommunal 2014) which indicates that the income and hours from one job is not sufficient. In this case, one of the employees who is working on-call describes that by combining hours at two different departments and often working long hours during the weekends (8.00-21.00), he achieves a total of 150-160 hours per month. Another key challenge pointed to by the union is the unpredictable working hours. The on-call worker interviewed in this case describes the hours as good and does not perceive the job as too stressful or heavy. However, the interviewee states that the on-call life is challenging. Not knowing when you will be called in, not knowing when you will work, or for how many hours, makes it difficult to plan your life.
With many short-term contracts, the company must arrange more on-boarding courses. Regardless of employment contract, there is some training that all employees need (e.g. fire protection). Additionally, frequent temporary employees are invited to participate in other general training as well, i.e. courses on dementia or for delegation of medication. To enable such information to reach the temporary employee, it is a challenge for the employer to keep good communication channels with those workers that are not frequently at the workplace. In addition, one of the employees expresses a hope for more open-ended contracts as that would facilitate further development for both the organisation and the employees.
For the employers, the high number of people passing through the organisation on short, fixed-term contracts make it harder to fulfil some of the employers’ responsibilities related to preventive work on health and safety issues. For instance, there is little opportunity to hold follow-up meetings with the temporary employees, and it is difficult to maintain an overview of the need for staff when the number of staff numbers is constantly in flux. This involves an increased risk of unforeseen job overload and stressful working conditions.
Lastly, being on a fixed-term contract may involve restrictions on how much influence the employee has on the work and work organisation. The employer representatives highlight the importance of temp workers being offered influence over the workplace. The lack of opportunities for on-call workers to participate at work-place meetings is therefore compensated by ensuring that on-call workers can access the same information via meeting minutes, and regular on-call workers are invited to respond, anonymously, to an employee survey that is conducted every fifth week. Employees that want to raise discontent regarding their supervisors can also turn to the organisation’s ethics representative (etikombudsman) or to the shop steward and health and safety representative. In addition, difficult oversight of the workload and number of staff makes it harder for workers to formulate critique and demands for more personnel.
This analysis of a private care company illustrates the use of NSW within the eldercare sector in Sweden. The company struggles with balancing restrained resources in terms of funding and qualified personnel and the need to staff 24–7. This challenge is largely managed by hiring temporary and part-time employees. Hence, staffing is optimised – seen from a perspective of economic and human resources – with the use of few personnel during the calm periods of the day and more during the intensive hours. These strategies can be criticised for posing new challenges, i.e. the need for flexibility overshadowing the need for continuity. Hiring mainly temporary employees, the company loses the capacity for competence, quality and development based on continuity and long-term experience. Furthermore, difficulties to attract and recruit employees are tightened when the employers cannot offer full-time or open-ended contracts. The optimised model also negatively affects possibilities for a secure income for employees who wish for longer hours. Moreover, the workdays in the optimised organisation are often found stressful with little room for additional or unplanned work tasks. Consequently, this may affect the quality of care. Although the current model makes part-time and temporary work a necessity, the employers express a wish to be able to hire more personnel on full-time, open-ended contracts. In the end, it seems, it is primarily a question of financial resources.
This case is a public care home for the elderly located in a larger Danish municipality. The specific municipality was chosen because it has an above average use of NSW (unpublished minute from KL – Local Government Denmark). From the interviews, it became clear that this municipality is less wealthy than other municipalities and has a larger share of citizens receiving welfare benefits than the average in Denmark. This may lead to smaller budgets in the different areas covered by the municipality (e.g. the eldercare sector) and may explain the more pronounced use of NSW (the on-call workers in particular). The specific care home used in the case study was appointed by the municipality eldercare department. It is representative of the municipality in terms of an extensive use of part-time employees and on call workers.
Besides being a care home, the workplace also has an activity centre and a training centre for both the residents and elderly people not residing in the home. A centre manager heads the care home, and a number of managers are responsible for different units. The care home has approximately 100 employees. The most common professions are nurses and social and health care assistants/helpers who provide practical and personal care for the residents, but there is also kitchen staff, administrative employees etc.
Since the care home is a public workplace, all employees regardless of employment type are covered by collective agreements. The workplace has two shop stewards, one from FOA (Trade and Labour) and one from DSR (The Danish Nurses’ Organisation). The workplace has a local work committee (a so-called MED committee), where the shop stewards are represented together with other employee representatives. In this committee, different issues concerning working conditions are discussed, as well as strategies for the economy, sickness absence, work environment etc.
In March 2019, seven qualitative interviews were conducted at the care home. One interview was with the centre manager and the remaining interviews were with employees with different employment contracts (see table 10.6). The centre manager chose which employees we could interview and the employees were interviewed about their current and previous positions, since many of them have been affiliated with the workplace for a number of years and have had several positions during these years.
|Centre manager||n.a.||Centre manager for the last 6 years. Worked with management within the eldercare sector in the municipality for the last 15 years|
37 hour per week
|Social and health care assistant||Has been at the workplace for 20 years, the last 9 years as a planner, where she is responsible for the work schedules. Before this she worked part-time as a social and health care assistant in evening shifts (first 22 hours, then 28 hours) and later on day shifts (35 hours)|
|Part-time employee |
32 hours per week
|Nursing assistant||Has been at the workplace for 2 years. Works normally day shifts and sometimes night shifts. Started at the workplace in four-week job training, then employed in two successive fixed-term positions and was employed in a permanent position after 6 months.|
|Part-time employee |
35 hours per week
|Social and health care helper||Has been at the workplace for 25 years, starting working night shifts (28 hours) but is today working day shifts, is also a safety representative and a part of the local work committee.|
|On-call employee |
|Unskilled||Has been at the workplace almost one year, has taken a basic course at the Basic Health Care College and wants experience before she starts studying to be a social and health care assistant. Has previously worked night shifts, but works day shifts now.|
|Flexi jobber |
15 hours per week
|Social and health care helper||Has been at the workplace for almost 20 years in different part-time positions (32 and 34 hours). Has recently started in flexi job due to illness.*|
15 hours per week
|Nurse||Has been at the workplace as a flexi jobber for almost a year.|
|* Flexi jobs target individuals who are not able to maintain ordinary employment due to illness. A flexi job-ber works reduced hours but receives a full-time wage. The company in which the flexi jobber is employed receives a wage subsidy from the municipality.|
Part-time permanent employment with a fixed monthly wage is the most common type of employment at the care home. Most common is 28-35 hours per week. 28 and 30 hours is standard for evening and night shifts, while 32, 34 and 35 hours is standard for day shift employees. Full-time and part-time permanent positions can only be held by educated personnel.
There are two main reasons for the widespread use of part-time employment and the more limited use of full-time employment. First, with the 24-hour staff need, it is easier to resolve work schedules using part-time employment. The centre manager says that she needs “a number of heads and hands”; therefore, part-time employment with a larger number of employees is preferred compared to fewer employees in full-time employment. If she only had full-time employees to choose from, she could not ensure that a sufficient number of employees were working at any given time. As a result, this would make it difficult to guarantee quality of the care provided to the residents at the eldercare home. Secondly, the centre manager stated that part-time employment has been the norm for many years within the social and health care sector, where most employees have no desire to work full-time:
The employees interviewed support this perspective to some extent. Some of them argue that the preference for part-time employment has to do with ensuring a work-life balance, while others argue that part-time employment is suitable because the job is physically and mentally exhausting.
Normally, the permanent staff (full-time as well as part-time employees) has an affiliation with one specific unit at the workplace, where they perform the work. However, the centre manager has also employed a small group of permanent employees (2-3 people) who can work at all units at the workplace and are placed in different units from day to day, depending on which units are in need of extra manpower. However, this is only possible for the centre manager because she expects that she will need the extra manpower a while ahead, and it has therefore been possible for her to employ a smaller group in permanent positions with a monthly wage. This small group therefore functions as a type of flexible workforce that can perform work anywhere in the organisation, but they still hold a permanent contract.
On-call workers who are paid per hour (“tilkaldevikarer” and “timelønnede” in Danish) are used to quite a large extent at the care home. As shown in table 10.3 there can be few or many on-call workers depending on the needs during the different seasons. For instance, during the summer holidays from June to September, between 25 and 50 on-call workers can be employed at the same time, but at other times during the year there might only be a few. However, on-call workers are used on a daily basis and at all times of the year and they step in to cover acute staff shortages when the permanent staff fall ill, take time off or take further training courses.
This group is employed directly at the care home (with a so-called “on-call letter”). Yet, compared to the permanent staff with a fixed monthly wage, the on-call workers have no fixed or guaranteed number of hours and they are only paid for the number of hours they have actually worked. They are covered by the collective agreements, but they have a different set of rights than the monthly paid employees. The main issues are that they do not have the right to full pay during sickness and maternity leave, they are not part of the terms of notice that applies in the Employers’ and Salaried Employees Act (Funktionærloven), and there is a certain period of quarantine before retirement payments are possible (FOA 2018; Holt et al. 2018:6).
Normally, on-call workers are called upon from day to day, but in some cases, a longer work schedule is provided. The weekly working time for the on-call workers can vary from working one day a week to full-time employment for a week. Most often they are used during evening and weekend shifts, because during day shifts more personnel are at work and the permanent staff is usually able to cover for each other. For financial reasons, the staffing is more limited during weekends and nighttime (because the staff must receive extra pay when working weekend, evening and night shifts).
Normally, on-call workers are recruited through unsolicited applications or through advertisements at the local educational institutions. Some of them are on-call workers because they need a student job, others because they need an income while waiting to start education, and others want to gain experience working in eldercare. Most of them are unskilled.
The management emphasises that it is important to ensure the group of on-call workers is stable and composed of people who are familiar with the care home and the tasks that need to be solved. Therefore, she often uses the same on-call workers:
This finding is in line with previous studies which found that many municipal workplaces have a stable network of on-call workers (e.g. Larsen 2008:55).
The care home provides training when an on-call worker starts, and for the first days he/she is under supervision from one of the permanent employees. Furthermore, unskilled on-call workers are not allowed to do certain tasks (i.e. treatment of wounds is solely for skilled staff). They also have more cleaning tasks than caring tasks, because caring is a task that require specialised skills.
According to the management, they use on-call workers as flexible, cheaper labour, since these workers are only paid for the hours they actually work and have a lower hourly wage.
Fixed-term employment is not that widespread, but normally used when the permanent staff have longer periods of leave, like maternity leave or sick leave. Furthermore, during the summer holiday, some of the on-call workers are offered employment in fixed-term positions for a couple of months and afterwards they return to working as on-call workers again.
Some of the interviewees were previously employed in fixed-term positions before they got permanent positions. Indeed, there seems to be an employment practice in which fixed-term employment is used as a sort of try-out period that can lead to permanent employment. This was for instance the case for one of the interviewees, who got a permanent position after two short fixed-term contracts. In her case, the period with fixed-term employment did not make her feel insecure because it was only for a limited time and she knew she performed well at the workplace. However, she expresses in the interview that if she had to continue for a longer period in a fixed-term position, she would miss stability and security in the job.
Previously, temps from temporary employment agencies were hired, but due to costs savings this employment form has been phased out. The workplace also takes in unemployed people in different forms of subsidised employment (wage subsidy, job training etc.) from the local job centre and students in internships from the nearby educational institutions. Volunteer work is also used to offer the residents different activities such as singing, gymnastics etc.
The centre director is not obligated to use certain types of employment or to offer contracts of a certain amount of hours or at certain times. Each year, the care home receives a lump sum for salaries, and within this economic framework the centre di|rec|tor is free to choose the staff and employment forms she finds most suitable. However, she is subjected to some guidelines concerning the use of skilled staff with exact norms set by the local work committee. Thus, there has to be a certain share of educated employees at the care home to carry out the tasks requiring specialised knowledge and competences. Therefore, the share of unskilled employees accounts for up to 10 per cent of all care staff. Unskilled cannot be employed in permanent positions.
It is a common perception at the workplace that the financial budget has over time become tighter, mainly due to financial cutbacks and increased focus on efficiency. However, it also has to do with the fact that the elderly people who move into the care homes today require more care than just a few years ago, and they are there|fore more resource-intensive than before. Furthermore, today, the staff use more time to meet documentation demands, which takes time from the more dependent residents at the centre. There is also an increased demand for staff undergoing skills upgrading. The number of employees has not been reduced over time but due to the documentation requirements, the skills upgrading requirements and the more resource intensive residents, the management and the employees all experience a busier and tighter work day than before. When asked whether the current number of employees is suitable for the tasks that need to be done, the ans|wer is yes. The problems with manpower normally just arise when the permanent staff is temporarily away due to sickness or skills upgrading and this is why es|pe|cially on-call workers are used to a quite large extent but also fixed-term contracts.
In the interviews, some issues concerning the working conditions and the working time for different groups of employees did emerge. One had to do with ensuring enough weekly hours for employees who do not work full-time. Another issue was about how to deal with overtime work for the permanent employees. The third issue was about an improper use of on-call workers.
Securing enough hours: An issue for employees with reduced working time is whether they are able to secure a minimum level of weekly working hours and thus earn a sufficient wage (Ilsøe et al. 2017). However, in this case the part-time employees were not concerned with this, because most often they already work relatively long part-time and many of them expressed during the interviews that they were not interested in working more than they already did. Some of them argued that the preference for part-time employment had to do with ensuring a balance between working life and family life, while others argued that part-time employment is suitable because the job is physically and mentally exhausting.
In 2007, KL – Local Government Denmark (the association and interest organisation of Danish municipalities) and KTO (an umbrella organisation for different unions with employees working in the municipality sector, now named FF – Forhandlingsfællesskabet) entered an agreement that ensured part-time employees access to a higher number of working hours and therefore also the right to work full-time if they want to. The principle is that when hours are available at a workplace, i.e. if an employee resigns, then the part-time employees must be offered extra hours before a new position is advertised. From other areas of the social and health care sector, we know that there are problems with complying with this rule, but this does not seem to be the case here. Both management and employees voice that it is possible to change the number of hours more permanently both upwards and downwards if needed (within a certain range) and that sometimes the staff is asked whether they want full-time hours. However, several interviewees state that normally the staff is not interested in this offer.
Ensuring enough hours is more important for the on-call workers. The interviewed on-call worker states that she is satisfied with the hourly wage, but it is important for her to have a sufficient number of weekly hours. However, at that moment she was actually working quite a few hours at the care home. She worked almost every day and some weeks full-time because she covered when the permanent staff were on holiday. Therefore, for this on-call worker, securing enough weekly working hours was not a problem at the time of the interview. We did not have the opportunity to interview other on-call workers and we therefore do not know whether they had the same perception.
Dispute about overtime work: In terms of working time and working more hours, the management pointed to a challenge with part-time employees, when they need staff to work extra or take overtime work. In general, the management would like the part-time employees to work extra hours when extra manpower is needed instead of using on-call workers, because they then have workers that are more familiar with the tasks and can ensure continuity. She can order part-time employees to take overtime work. However, she argues that she has chosen a voluntary strategy, where she asks employees to work more instead of ordering them to do so. However, at the time of writing, the local manager had a dispute with one of the unions about this. The union argues that according to the collective agreements, the permanent staff must be compensated financially if the management requests them to work on their days off. Therefore, the management resorts to the on-call workers instead, because they can say no without extra costs for the employer. The management’s perception is that their part-time employees would like to be asked occasionally about working more hours, but the trade union argues that the employees have the right to have certain days off, when the management should not contact them. The management thinks that some of the employees are being “taken hostage” in this dilemma, since they actually would like to be offered extra hours from time to time, but are seldom offered this due to the regulations in the collective agreements. Therefore, she is unable to show consideration for the few part-time employees who would actually like to have some extra hours from time to time. In the employee interviews, this was not touched upon as a dilemma since they were not interested in working more hours at all.
An improper use of on-call workers: From the interviews, it also became clear that on-call work is sometimes used in conflict with the regulations. According to the collective agreements, workers paid per hour (which is the case for the on-call workers) must have a fixed monthly pay and thus be employed in fixed-term positions if they have a more permanent affiliation with the workplace (FOA 2018). This could be the case if they are no longer called in from day to day but instead provided with a work schedule for a longer period of time. The manager tells us that she knows this practice is against the regulations but sometimes she resorts to it because she has difficulties finding qualified personnel for vacant positions. Therefore, if a position is vacant, she sometimes uses on call work until the position is filled even though she is aware that the position should be a fixed-term position. The centre manager explains that she faces this challenge more often because it is increasingly difficult for her to recruit skilled staff that can accommodate the needs at the workplace.
The interviews also voiced some matters concerning different health and safety issues. One had to do with the training provided for non-permanent staff and another with the actual treatment and inclusion of this group of employees.
Training: The management seems concerned with the fact that on-call workers are trained before they are allowed to work at the care home since many of them are unskilled. First of all, they have to be trained in and informed about safety regulations, medication, lifting techniques and so on and when they start working at a specific unit, they normally follow one of the permanent employees for some time in order to learn about how the tasks are performed. Before the summer holidays, where the use of on-call workers is more extensive, they usually have a few introduction days during which the centre manager and a nurse introduce and train them to the tasks. The centre manager says:
The permanent staff agrees. They say that of course it is demanding for them to train the new employees, but they do not see it as overwhelming or exhausting, but rather as an investment because they know that good training is necessary in order to ensure good quality care for the residents. During the workday, the permanent staff is responsible for supervision of the temporary employees and therefore they are also interested in giving them as good an introduction as possible. However, according to the interview with the on-call worker, she had only one day of training, when she started at the unit and at that time, she did not feel it was enough to work without supervision.
Unequal treatment: During the interviews, it also became clear that the temporary staff is not always treated equally to the permanent staff, which is the case for both fixed-term employees and on-call workers. There seems to be a hierarchy and a certain role division at the units where fixed-term employees have less influence on the tasks performed and experience being told what they can and cannot do by the permanent employees. There is also an experience of a lack of respect from the permanent employees and a harsher tone towards the temporary employees. For the on-call workers, it was mentioned that they do not participate in staff meetings and similar workplace activities. In the case that on-call workers are used only in peak times, the lack of influence and the differences in tasks may not be a problem, but if on-call workers see the job as something more permanent or they are employed on a long-term basis, this differential treatment may be unsatisfactory.
The care home case analysed is a public workplace that has an above average use of part-time and on-call workers, and is located in a municipality with the same traits. Part-time employment is perceived as standard employment to make work schedules fit, while fixed-term and especially on-call workers are used as flexible workforce. The care home is subject to a narrow financial budget, though in their opinion it manages to have the sufficient number of permanent employees to perform the tasks and provide quality care. On-call workers are employed because they are a cheaper type of labour and thus a way of managing the budget. This result is in line with other research in the same field (Holt et al. 2018). In addition, the case faces some challenges with the employment of on-call workers that is sometimes against the regulations in the collective agreements. From the management’s point of view, there are some conditions on overtime work in the collective agreements that encourage use of on-call workers as a cheaper solution. The use of flexible labour challenges continuity, and although the management is aware of the need for skills training for the flexible workforce, it is not always sufficient. Furthermore, the flexible workforce is not always treated equally to the permanent staff.
In both the Danish and the Swedish eldercare sector, the use of part-time work is frequent and presented as necessary to schedule in a way that guarantee high quality of care as well as good working hours for the employees. While there are a high number of employees who voluntarily work part-time, this does not hold for everyone and measures have been made to enable those who want more hours to achieve this when an opportunity arises. For instance, in both countries part-time workers are – under certain conditions – legally guaranteed precedency for a contractual extension of hours.
Temporary employment in the form of different types of fixed-term contracts and on-call work is also used to a large extent in both countries. Especially on-call work is criticised by the unions for being misused and applied too frequently but is used in both countries to provide the employer with numerical flexibility as they avoid over-staffing and are still able to manage sick leave and similar short-noticed absence among staff. The use of this employment type seems to be a conscious strategy in the planning of schedules. Moreover, on-call work may function as a trial period, which provides the employer with a flexibility, that other contractual forms do not allow.
Largely, the eldercare sectors in Denmark and Sweden face the same kinds of challenges, and the same kinds of rationales are reflected in the interviewees’ accounts for the frequent use of non-standard contracts despite the fact that one case is private and the other public.
Firstly, the sectors in both countries are highly conditioned by restrained economic and human resources (i.e. a shortage of skilled workers). These conditions are the grounds for the currently dominating model for how to organise work and to staff the various work shifts: an optimised model that requires part-time and temporary employees. The need for part-time workers has been established as a truth, and – despite various initiatives made by the social partners – it has proven difficult to offer permanent contracts or to increase working hours for those who are involuntary on part-time contracts. This “truth” has also prevented proper discussions on alternative ways of organising work. However, in a joint and recent initiative by The Swedish Association of Local Authorities and Regions (SKR) and The Swedish Municipal Workers’ Union (Kommunal), such discussions are brought to the fore and the norm of part-time work is deliberately challenged.https://heltid.nu/
Secondly, the cases in both countries faced increased differentiation of work tasks. This is a consequence of the shortage of qualified personnel and of politically set goals of offering employment also to unskilled individuals. The consequences of differentiation, in turn, are that the employer organisations are provided with cheaper labour (i.e. lower wages for some groups) and greater numerical flexibility (provided by temporary employment). However, it also involves a diminished functional flexibility, as unskilled personnel cannot substitute or rotate with employees performing qualified care work. We find examples of innovative attempts by the social partners to address some of these issues in both Sweden and Denmark. In Sweden, for instance, unions and employers have created a partnership on a competence lift for employees in eldercare to ensure more assistant nurses (see box 10.3).
In Sweden, permanent contracts for care workers generally require certain education and skills. According to the labour union Kommunal, the system is a kind of Catch-22, since the employer is expected to validate and educate non-qualified care workers. As this obligation to validate and educate only applies to permanent employees, non-educated temporary care workers are often unable to upskill and transfer to a permanent job.
In order to overcome these barriers, the union has called for a “re-thinking” of adult education. Currently, there are two major, on-going efforts: regional work-oriented adult education which is called for by the municipalities and financed by the employees themselves (SFS 2016:937); and the competence lift, in which the employee can work half-time and spend the rest of the time studying to become an assistant nurse. The latter investment is made in agreement with the employers’ organisation, SKL (Swedish Municipalities and Regions) (Kommunal 2016c).
Thirdly, focusing on working conditions and the social situation for employees on non-standard contracts, we also find similar challenges in Denmark and Sweden. One challenge is offering part-time and on-call workers sufficient hours, but without putting them in a position where they are forced to accept too-long hours, due to fear of losing their job if they decline. In addition, both cases experience conflicts on overtime management within the sector. In Denmark, there is a restraint on asking part-time workers on permanent contracts to work overtime. This is intended to protect employees from being pressured to work too-long hours, but it also makes it more difficult to offer extra hours to those who would want it. In Sweden, there have been discussions on whether an on-call worker’s hours could be defined and thus compensated as overtime or not. Since on-call workers rarely work full-time, this is mainly a matter of overtime pay. Thus, traditional agreements and regulations seem difficult to apply to the non-standard contracts. In Denmark, unions and employers have introduced labour clauses into public procurements to ensure orderly conditions when outsourcing care to private companies (see box 10.4).
In Denmark there are cases where private care companies have gone bankrupt and the subcontracted workers’ wage and working conditions were found to be below collectively agreed standards, especially in the cleaning sector (Rasmussen et al. 2016). As a result, municipalities have applied labour clauses in publicly procured care work supported by trade unions and centre-left political parties (Larsen & Mailand 2018; Jaehrling et al. 2018). The labour clauses follow ILO convention 94 and oblige private care contractors to comply with wage and working conditions outlined in the most representative collective agreements covering the private care sector (Larsen & Mailand 2018; Jaehrling et al. 2018).
Moreover, the case studies from both countries illustrate how the use of temporary employees involves challenges with finding enough time for training and development, and to exercise influence within the organisation. From a managerial perspective, it is a matter of balancing organisational needs for flexibility and continuity, as well as solving the short-term needs of personnel yet simultaneously adopting a long-term approach to attract sufficient and skilled care workers. Associated also with the increased differentiation, our findings point to a tendency for increased status differences and hierarchies in the work teams, obstructing any aims for equality and inclusion at the workplace. In addition, the temporary employments generally offer weaker welfare protection in case of sickness or unemployment.
An overarching challenge within the eldercare sector in both Denmark and Sweden is to retain and attract personnel to organisations with limited economic resources that restrain their possibilities to offer employment with good terms. Even if the employers point to a common interest among the employees in the sector to work part-time, surveys conducted among union members show that, at least in Sweden, the majority of the part-time workers wish for longer hours in the contract (Szebehely et al. 2017: 1; 11; Kommunal 2018b: 16). Similarly, there is broad support among temporary workers for stricter employment protection legislation, especially for increased job security (Svalund et al. 2016). At the Danish case company, however, the employees express a general satisfaction with the extent of their working hours, which probably relates to the fact that the interviewees did work relatively long part-time hours. At the time of writing, there is a public and political debate in Denmark about how to tackle the recruitment challenges, with converting part-time employment to full-time employment presented as one of the solutions (KL & FF 2020). However, the existing research is not at all clear-cut. Some studies emphasize that part-time employees do not want to work full-time for personal and health related reasons (work life balance, mentally and physically exhausting labour) (Finansministeriet et al. 2018). Meanwhile, others argue that part-time employees would like to work more, but often are not given the opportunity (FOA 2017b). Regardless of whether part-time work is voluntary or not, however, this way of organising work may seem to favour the employers more than the employees.
To improve the terms of work (and thus the attractiveness of the occupations) as well as the quality and continuity of the provided care, the social partners in the sector need to manage the challenges that this involves. This can be done either by rethinking the current models for organising work so that the sector can offer more secure employment, or by offering better working conditions and stronger welfare and employment protection schemes for those working on non-standard contracts.
By: Katrin Olafsdottir & Paul Jonker-Hoffrén
Non-standard work (NSW) is more widespread in some sectors than others across the Nordic labour markets, and its share is particularly high in labour intensive and low wage service sectors, where a highly flexible workforce is pivotal for many workplaces to adjust to rapidly changing economic cycles and service demands. This is for instance the case in the companies examined in the previous three chapters, where local management and their workers have developed novel ways of organising work to meet service demands and the challenges arising from relying on non-standard and emerging employment forms.
The eldercare and hotel case studies are examples from sectors that are dependent on labour intensive and highly flexible work, with a constant pressure to contain labour costs. Both sectors also experience daily peaks in that there is demand for chambermaids in hotels in the middle of the day, while the demand for care staff in eldercare is more pronounced in the morning and during meal times. For flexibility and cost-saving purposes NSW is common and many workers in these two sectors work part-time, often on zero-hour contracts, fixed-term contracts or as on-call workers. Most of these workers are unskilled, and only a limited number of them are able to or wish to convert NSW into full-time permanent contracts.
Freelancing companies have been started in some of the Nordic countries. The form of these companies varies, and they provide a wide range of services to individual freelancers, from book-keeping for solo self-employed individuals, to providing some social protection and employing the solo self-employed individuals as employees. Regardless of the form, freelancing companies serve to provide an alternative to bridge the large gap between traditional standard employment, which provides social insurance such as unemployment benefits and parental leave, and solo self-employment, which offers the freedom to choose your own projects to work on, but provides limited or no social and employment protection.
There are various reasons for firms choosing to rely on non-standard work, while other considerations hold for employees choosing non-standard work. These will be discussed below in light of the case studies presented in the previous three chapters (chapter 8-10), which are written by members of the national research team.Anna Hedenus, Kristine Nergaard, Stine Rasmussen, Emma S. Bach, Tiina Saari, Satu Ojala, Pasi Pyöriä, Paul Jonker-Hoffrén, Trine P. Larsen, Anna Ilsøe.
There are many sectors where firms require flexibility of their workforce, including hotel services and eldercare. In Atkinson’s classical sense, firms have a stable core and a flexible periphery (Atkinson 1987; Burgess 1997). The core exhibits functional flexibility, while the periphery has numerical flexibility. Although this view has been criticised in many ways, the case studies in the previous chapters clearly show that there is a flexible component in the firms’ recruitment practices with important implications for distinct groups of workers. There seems to emerge a dual labour market at the workplace with some groups enjoying greater levels of employment protection and social protection than others.
It seems that the exact form of employment flexibility applied in the firms studied depends on contextual factors. In some countries, it may be more convenient for the firm to hire part-time workers and in others to rely on zero-hour contracts or on-call workers. Since the case studies frequently mention the shortage in the supply of skilled labour, this must also be considered. Another consideration is whether non-standard workers are seen as potential future core workers. This depends on what the firm sees as its core functions.
The Danish and Finnish hotel cases are instructive. It is explicitly stated that the Danish hotel has changed recruitment strategies to increasingly rely on zero-hour contracts and subcontracted work rather than open-ended part-time contracts, for the reason of high unpredictability of working situations. A hotel has a fixed capacity but a varying stream of guests, which translates into different demands for labour, and a varying stream of sometimes simultaneous conferences and events. The Finnish hotel case caters to both private guests and events, whereas the Danish hotel case mainly serves as a conference hotel. This might explain the somewhat larger share of permanent employment in the Finnish case relative to the Danish case.
The issue of qualified personnel is also raised in the Swedish and Danish eldercare cases. Both the Swedish care company and the Danish care home operate on a tight budget related to municipal finances. NSW is a solution to this, but the regulatory context of the service requires a certain level of qualification. Also, the eldercare cases demonstrate how NSW can function as a kind of recruitment policy, to scout promising employees.
The form of NSW may also be related to legislation and collective agreements. For instance, Finland has quite strict regulation of the use of zero-hour contracts whereas Denmark does not have legal restrictions (chapter 2 by Larsen & Ilsøe 2020b). Therefore, even where the need for a flexible labour force is similar in the Nordics, the form this takes may be determined by the legal possibilities in each country.
Almost a third of all employees are in NSW in the Nordic countries (chapter 1 by Larsen & Ilsøe 2020a). Many of those working in NSW are young, female and immigrants although also a growing number of non-standard workers are older workers just about reaching retirement age (chapter 2 by Larsen & Ilsøe 2020b). While some non-standard workers prefer the stability of a regular full-time job, others appreciate the flexibility provided by various forms of non-standard forms of work. Whereas marginal part-time and solo self-employment are voluntary choices for many, employees working on temporary contracts often do so involuntarily (chapter 2 by Larsen & Ilsøe 2020b).
In the hotel cases from Denmark and Finland, low-skilled workers are often hired as non-standard workers. In Denmark, most of them are on zero-hour contracts. Many of the waiters are students that work at the hotel to supplement their student allowance. Some of the cleaning staff work on zero-hour contracts, while others are subcontracted workers employed at the hotel through a private cleaning company or are directly employed with the hotel on open-ended contracts. In Finland, those doing non-standard work were mostly young women. For young people in vocational education, some hotels offer apprenticeship and other practical training, which is an opportunity that may lead to future employment at these hotels.
While the flexibility of zero-hour contracts may be advantageous to some, as workers can have a say when to work and how many hours, they also come with uncertainty as no hours are guaranteed, and workers only get paid for hours worked. As the Danish hotel case showed, if workers are being offered shifts every day, it may be difficult for them to decline, and workers end up having very few days off.
In the eldercare company in Sweden more than half of the employees at the company work on temporary contracts (both longer and shorter), part-time employment, and as on-call workers. The on-call workers are mostly students, new graduates and newly arrived immigrants. In the Danish eldercare home, long part-time permanent employment is the most common type of employment followed by on-call workers on zero-hour contracts. Some employees on long part-time contracts have no desire to work full-time, as the job is physically and mentally exhausting.
In hotel services and eldercare, women and immigrants seem to be overrepresented, as well as students. For most students, the job is a temporary situation, while women and immigrants are more likely to seek a permanent and perhaps full-time position in the same industry. However, training is limited and few opportunities for advancement are on offer for unskilled workers. One of the policy responses discussed in this regard has been how to improve skills upgrading and education in these sectors and make them more attractive to young people seeking to make a career in either hotel services or eldercare.
Finally, freelancer companies serve to provide an alternative in the large gap between traditional employment, which provides social insurance such as unemployment benefits and parental leave, and solo self-employment, which offers the freedom to choose your own projects to work on, but provides little or no social insurance. The form of these companies varies, from serving the purpose of bookkeeping for solo self-employed individuals to providing some social insurance.
In both the Norwegian and Swedish case studies of freelancer companies, the self-employed individuals have employee status at the freelancer company. In the Norwegian case, they are offered a permanent job, which entitles them to sick pay, pension scheme enrolment, etc. However, employment by the company does not come with a guaranteed income as the wages paid are determined by the income generated by the freelancer. Most of the freelancers work in music, sound or lighting, where full-time permanent jobs are few. In the Swedish case, the company administers billing, tax payments, accounting, and pays a salary to the freelance employee. The company caters to those who do not want, do not know how, or are not allowed to run their own business.
The existence of freelancer companies seems to be a response to two separate issues in the labour market. On the one hand, it offers a solution for those that value the flexibility of freelance work, while seeking assistance with bookkeeping, securing some level of social protection and thus providing some stability. On the other hand, it may also be a refuge for those that seek regular employment but are unable to find full-time regular work.
Social partners and governments in the Nordics have debated the various possibilities and challenges of NSW, also with regard to emerging practices within sectors characterised by significant shares of non-standard work. We find policy responses to some of these emerging practices in all five Nordic countries. These examples seem to fall into three groups.
First, we find examples where social partners seem to address emerging practices within the Nordic models of collective bargaining. In Denmark, for instance, the union and employers´ association in the hotel and restaurant sector have negotiated higher hourly wages for workers on zero-hour contracts into the sector-level agreement as well as negotiated a separate chambermaid protocol to keep the numbers of full-time workers at a certain minimum. In Sweden, government, unions and employers´ associations in eldercare have negotiated a scheme for competence lifts of non-standard workers in eldercare, where they work and study part-time simultaneously.
Such regulatory responses via collective agreements have an effect at workplaces covered by the collective agreement and are often implemented quite quickly. However, they do not have much direct effect on workers without collective agreement coverage. This is often the case for solo self-employed workers, who are difficult to include in collective bargaining due to competition laws (Hotvedt et al. 2020). Therefore, it is also interesting to study examples of regulatory responses by legislation especially with regard to the self-employed. For instance, in Iceland they have introduced a mandatory pension scheme for all self-employed by law.
Finally, we find examples where the players respond to developments in NSW by invoking a statutory extension of collective agreement terms. In Denmark, where the players reject statutory extension, we find examples that agreement terms are extended via labour clauses in publicly procured work including the eldercare sector. In Norway, Iceland and Finland we find a legal extension of collective agreement terms in a number of sectors. Such extension mechanisms can protect non-standard workers and reduce the level of insecurity, but only cover workers with employee status. Solo self-employed and various other forms of independent work are more difficult to cover via this mechanism.
By: Trine P. Larsen & Anna Ilsøe
Across Europe, national governments have launched unprecedented help and relief packages aimed to help companies and workers cope with the Covid-19 crisis. These initiatives often favour companies and employees characterised by traditional employment i.e. full-time, open-ended contracts, but the Nordic governments have also launched a series of ad hoc relief packages or amendments in income security schemes that target non-standard workers such as freelancers, part-time workers with few hours, temporary workers and students. As shown in this report, non-standard workers are often more exposed to loss of employment and income during times of crisis. However, they tend to be more patchily covered by social and employment protection that delivers income and job security for individual workers during a crisis (see also Kalleberg & Vallas 2018; Rubery et al. 2018; Spasova et al. 2017). It is therefore important to examine how these groups fare during the crisis. Notably in light of the Nordic governments’ recent help and relief packages that explicitly target non-standard workers.
This chapter offers insights into the preliminary impact of the corona crisis on the Nordic labour markets, and briefly reviews the Nordic governments’ various help and relief packages with a specific focus on non-standard workers.
The chapter is structured as follows: First, we briefly review the effects of the corona crisis on the Nordic labour markets and examine the recent national help and relief packages with a particular view to those explicitly targeting non-standard workers. Afterwards, we present some preliminary findings regarding the effects of these help and relief packages among Nordic employers and workers to explore their impact thus far before summing up our main findings. The chapter draws on data from the Nordic Labour Force Surveys (LFS), the Eurofound surveys, and individual country-specific surveys including national unemployment figures as to the effects of the recent corona crisis for non-standard workers’ employment and income security. The chapter is also informed by desk research of policy documents, position papers and research studies about the Nordic governments’ help and relief packages and their short-term effects.
When the corona pandemic swept across the Nordic countries in the beginning of March 2020, the Nordic governments decided to introduce a range of restrictions and containment measures. These included bans on large gatherings, social distancing combined with widespread testing and tracing of infections. In the case of Denmark, Iceland, Norway and Finland, a lockdown of large parts of society and working life was ordered by the respective governments to limit the spread of the virus. Sweden opted for a slightly different approach as no forms of lockdown were introduced. All five Nordic countries turned to online education, but only in Sweden did primary schools, day care, restaurants, gyms and businesses remain open, albeit with restrictions applied. The various national containment measures not only in the Nordics but also in many other countries have had severe implications for Nordic companies, workers and the Nordic economies overall. Companies that just a few weeks earlier were considered booming businesses, now risked company closure and employees were dismissed or temporarily sent home with or without pay for an unknown period, and many reported financial hardship. A survey by Eurofound conducted in April 2020 indicated that around 12 per cent of individuals in Denmark, 21 per cent in Sweden and 28 per cent in Finland experienced financial hardship compared to just three months earlier, and even more expected that the economic difficulties would continue or increase in the next coming months (Eurofound 2020b). A number of country specific studies also suggest that many Nordic companies lost more than 25 per cent of their business in March and April 2020, leading to mass redundancies (Statistics Denmark 2020t; Statistics Sweden 2020z; SA confederation of Icelandic Enterprise 2020). Sectors such as retail, hotel and restaurant, aviation and large parts of retail and the creative industry were, along with schools and daycare institutions, particularly hard hit in the first weeks of the corona crisis, i.e. March and April 2020. However, since then the economic downturn has expanded to other sectors and led to a general economic slowdown of the Nordic economies in the first and second quarter of 2020 (fig. 12.1).
In the first and second quarter of 2020, Iceland was particularly hard hit: the Icelandic GDP dropped from a positive growth rate of 4.8 per cent in the fourth quarter of 2019 to a negative growth rate of -7 per cent in the first quarter and -9.3 per cent in the second quarter of 2020. Declining tourism following several countries’ lockdown and travel restrictions contributed to the severe Icelandic slowdown (fig. 12.1; Statistics Iceland 2020x). Denmark, Sweden, Finland and Norway also saw stark negative GDP growth rates in the first and second quarter of 2020 (fig. 12.1), leading to a historic economic dive with a GDP growth rate of -8.6 per cent in Sweden, -7.4 per cent in Denmark and -5.1 per cent in Norway (fig. 12.1). The Finnish economy also suffered a blow in the second quarter of 2020 with the GDP shrinking 4.5 per cent, although the recession appeared less severe here than in the other four Nordic countries. Altogether, the initial phase of the corona pandemic hit the Danish, Swedish, Norwegian and Icelandic economies and labour markets harder than the global financial crisis in 2008 both when measured in GDP growth rates (fig. 12.1) and joblessness (fig.12.2).
The economic downturn has been accompanied with severe drops in employment and rising unemployment. More than 80,000 workers in Denmark, 124,000 in Finland, 210,000 in Norway, 118,903 in Sweden, and 49,000 in Iceland lost their jobs or were temporary dismissed and registered themselves as unemployed within the first weeks of the corona crisis from mid-March to the start of April 2020 (STAR 2020c; NAV 2020p; MEAE 2020d; Government of Iceland 2020b; Arbetsförmidlingen, Sverige 2020a). Since then the numbers increased in all the five Nordic countries and peaked in April and May, then slowly declined except for Iceland where unemployment took a hike in July 2020. The overall unemployment rate when using Nordic job centre unemployment figures ranged from 6.4 per cent in Iceland, 7.4 per cent in Norway, 6 per cent in Denmark and 8.5 per cent in Sweden to 12.5 per cent in Finland in August 2020 (fig. 12.2). In this context, it is important to note that the Finnish, Norwegian and Icelandic figures cover wider groups, including those on temporary lay-offs/furlough schemes. This stands in sharp contrast to Denmark and Sweden, where those covered by the wage compensation scheme (Denmark) or the short-time work scheme (Sweden) are not registered as unemployed. In addition, it is important to note that the national unemployment figures for each of the five Nordic countries are higher than for example the unemployment figures documented in the LFS, where unemployment is measured differently (Eurofound 2020b).In the LFS survey, individuals are first registered as unemployed when they have been without jobs and actively seeking new employment in the past four weeks and are able to start work within the next two weeks. In addition, individuals temporary dismissed in the first weeks of the corona crisis, are not registered as unemployed in the LFS, so the LFS might underestimate the share of unemployed (Eurofound 2020b).
Note: “Unemployed” covers full-time and part-time unemployed and unemployed in activation in the five Nordic countries.
A large share of those registered as unemployed in Norway, Finland and Iceland in Spring 2020 were temporarily dismissed; short-time work schemes or what is also often referred to as furlough schemes (temporary lay-offs) have been extensively applied to avoid dismissals. More than 371,488 workers in Norway, 158,100 in Finland and 35,000 in Iceland were covered by the state-funded furlough/temporary lay-offs schemes in the first two quarters of 2020 and they had to register themselves as unemployed to receive income support to top up their wages (STAR 2020b;; NAV 2020p; Government of Iceland 2020b). Thus, corresponding to 6.3 per cent of all employed in Finland, 14 per cent in Norway and 18 per cent in Iceland were part of a furlough/short-time work scheme during the spring of 2020. In Denmark, the 282,178 workers covered by the Danish state-funded wage compensation scheme were, like their 577,090 Swedish peers covered by the Swedish state-funded short-time work scheme, not requested to register as unemployed to receive wage compensation if they were temporarily laid off. This may also explain the lower unemployment figures in Denmark and Sweden than in Finland and Norway (Statistics Denmark 2020q; Tillväxtverket Sweden 2020a).
When looking at the group of unemployed people, it is particularly young people, lower skilled, low-income groups and non-standard workers in certain sectors such as arts, recreation, tourism, transport, hotels and restaurants who lost their jobs or are temporarily laid-off during the corona crisis. Unemployment among older workers aged 64+ years also increased considerably especially in Finland (STAR 2020c; Bratsberg et al. 2020; MEAE 2020d). In Sweden, the unemployment rate among young people under 25 increased from 20 per cent in December 2019 to 29 per cent in June 2020 (fig. 12.3). Young people were also more likely than their older peers to lose their jobs in the other Nordic countries as well – or not find a job when entering the labour market –
in the first two quarters of 2020, but to a somewhat lesser extent than in Sweden (fig 12.3). The various national help and relief packages in the Nordic countries, often with job guarantees as a premise for government support, may have protected some jobs, even though the Nordic economies have been hit hard by the corona crisis (Eurostat 2020b).
Non-standard workers are among the groups that have been particularly affected by the crisis. As shown in Chapter 1, almost 30 percent of all employed in the Nordic countries are non-standard workers. In some sectors such as retail, hotel and restaurants and the creative industry, the number of NSW is much higher (see chapter 3–7).The recent figures from the Nordic LFSs offer some insights into the effects of the recent corona crisis for the employment of non-standard workers. Many non-standard workers work in sectors highly affected by the corona crisis such as retail, hotels and restaurants and the creative industry, aviation and tourism. However, other sectors such as manufacturing also saw many temporary workers lose their jobs when the corona crisis and the lockdown hit the Nordic labour markets (Dansk Erhverv 2020; Eurostat, 2020b; fig. 12.5; fig. 12.6).
When looking at specific groups of non-standard workers in sectors highly affected by the corona crisis such as hotel and restaurants, we find that the share of part-time workers, temporary workers and solo self-employed workers changed significantly in the first two quarters of 2020 in all the Nordic countries (fig. 12.4). In the Danish and Swedish hotel and restaurant sector, the share of temporary workers declined by 37 per cent in both countries in the first two quarters of 2020 compared to 24 per cent in Norway and 42 per cent in Finland during the same period. Also the number of part-time workers declined by more than 20 per cent in Denmark, Finland, and Sweden, in the first two quarters of 2020, but less so in Iceland (-15 per cent) and Norway (-4 per cent) (fig. 12.4).
Note: Figures for Iceland regarding temporary workers and figures for solo self-employed in Denmark, Iceland and Norway are unavailable due to too few observations.
Also in other sectors such as manufacturing, retail and the creative industry did the numbers of temporary workers drop in the first quarter of 2020, but this trend only continued in manufacturing and in the Finnish, Swedish and Norwegian creative industries in the second quarter of 2020. In the other sectors, the numbers of temporary workers started to increase slightly in the second quarter of 2020 (fig. 12.5).
Note: Figures for Iceland regarding second quarter of 2020 for temporary workers in the selected sectors are unavailable.
In contrast to the number of temporary workers, the numbers of part-time workers increased or remained fairly stable in manufacturing and construction, especially in the first quarter of 2020, while their numbers declined slightly in the creative industry and retail sectors during the same period (fig. 12.6).
Looking at the recent development in solo self-employment in agriculture, construction and the creative industry, we also find that their numbers changed during the first two quarters of 2020, but more in some Nordic countries and sectors than in others. In the creative industry, the number of solo self-employed workers declined by 38 per cent in Denmark, 20 per cent in Finland, and 8 per cent in Norway while marginally increasing in Sweden (+4 per cent) during the same period. Solo self-employed workers within Finnish agriculture, fishery and forestry were also hit hard it by the corona crisis with nearly one in five losing their employment in the first two quarters of 2020, contrasted with marginal increases in Sweden, Norway and Iceland (fig. 12.7).
Figures for temporary agency workers (TAWs) are not yet available from Eurostat, but individual country and cross-country analyses suggest that the temporary agency industry and its workers have been hit particularly hard by the corona crisis and in some countries even harder than during the 2008 financial crisis (WEC 2020). In the first weeks of the corona pandemic, i.e. March and April 2020, revenues within the temporary agency industry dropped by more than 23 per cent in Norway, Finland and Sweden respectively, compared to 9 per cent in Denmark, and have since then continued in a downward spiral in the second quarter of 2020 (WEC 2020). Also, the number of TAWs decreased substantially, dropping in Denmark from 1.2 per cent in 2019Q4 to 0.9 per cent in 2020Q1, and from 1.4 to less than 1 per cent in Norway. (Dansk Erhverv 2020; NHOSH 2020).
As shown, the corona crisis hit non-standard workers hard, especially temporary workers and part-time workers in the hotel and restaurant sector and solo self-employed workers in the creative industry during the first two quarters of 2020. However, the numbers of non-standard workers affected by job loss or temporary lay-offs in the initial phase of the pandemic were most likely much higher than the figures suggested by the LFS data, due to the way the LFS data are collected and unemployment measured in the LFS (Eurofound 2020b).In the LFS survey, individuals are first registered as unemployed when having been without jobs and actively seeking new employment in the past four weeks and are able to start work within the next two weeks. In addition, individuals temporary dismissed in the first weeks of the corona crisis in March 2020, are not registered as unemployed in the LFS, whereby the LFS might underestimate the share of unemployed (Eurofound 2020b). This is also supported by national register data for the Nordic countries, where the reported numbers of unemployed are much higher, especially in sectors such as retail, hotels and restaurants and the creative industry with large shares of non-standard work.
The Nordic governments have initiated a series of help and relief packages to mitigate the financial and social effects of the corona crisis. These packages have not only targeted companies and employees characterised by traditional employment, i.e. full-time open-ended contracts, but also distinct groups of non-standard workers such as freelancers, part-time workers and temporary workers. The various policy initiatives have been extended not only in terms of groups covered, but also as to their duration, as the corona crisis evolved and new containment measures were adopted. The Nordic governments have thus far adopted more than 100 help and relief packages, often in close collaboration with the social partners and with broad support of other political parties. They range from financial aid to keep businesses afloat, tax deferrals, social protection packages, job protection, specific measures stimulating innovation, employability and the economy. Some help and relief packages seem more relevant for non-standard workers than others. In the next section, we briefly review different policy responses developed by individual governments in the five Nordic countries with a particular focus on their coverage of non-standard workers.
In the first weeks of the lockdown in March 2020, the Danish government launched a series of help and relief packages worth more than DKK 400 billion, targeting Danish companies and workers. The policy responses were introduced in six waves from 10 March to 14 September 2020 and amounted to more than 30 policy responses, many of which ended on 31 August 2020, while others continued to be in force until January 2021 or even longer. The Danish government has continuously revised their various policy measures and extended them to new groups, often in close collaboration with social partners and with broad support from other political parties.
One of the flagships of the Danish help and relief packages was the tripartite wage compensation agreement. It entailed e.g. that the state would financially cover up to 75–90 per cent of employees’ wages with a pay cap of DKK 26,000 per month for companies having to dismiss at least 30 per cent of their workforce or 50 or more employees, provided they did not lay people off. However, certain conditions applied in that employees had to use five days of holiday and be permanently employed with the crisis-ridden company. Thereby, temporary workers, freelancers and external consultants were without coverage from the wage compensation scheme (BEK nr. 267/25/03/2020). Another key measure has been the short-time work scheme, where the Danish government relaxed the rules for using such schemes, although certain conditions continued to apply (STAR 2020b). The short-time schemes can only be applied if the company guarantees job security for all employees, and there are limits as to how far working hours can be reduced (at least two days of usual working hours in a week or one week off, one week at work or two weeks off and two weeks at work) (STAR 2020b). Employees covered by short-time schemes may qualify for unemployment benefits to top up their wages. However, while the usual eligibility criteria applied (membership of an unemployment benefit fund and certain numbers of accrued weekly working hours etc.) prior to 14 September 2020, the Danish government temporarily suspended the requirement of membership of an unemployment benefit fund and raised the level of unemployment benefits from mid-September (STAR 2020b; BM 2020). However, the eligibility criteria requesting a certain number of accrued working hours still applied. Thus, some groups of non-standard workers, notably part-time workers or workers just re-entering the labour market after long spells of unemployment, may struggle to qualify for unemployment benefits to top up their wages when temporarily laid off. Likewise, temporary workers are unable to benefit from a short-time scheme due to their temporary contracts as only permanent staff can be covered.
Measures were also introduced to explicitly support solo self-employed workers, freelancers and entrepreneurs. If they could document that they had lost up to 30 per cent of their revenue due to the corona crisis, these groups could receive compensation covering up to 75 per cent of their lost revenue with a cap of DKK 23,000https://virksomhedsguiden.dk/erhvervsfremme/content/temaer/coronavirus_og_kompensation/. Targeted support was also offered to artists combining waged work with income from freelance or solo self-employed activities covering up to 75 per cent lost revenue provided they had at least a total annual income of DKK 100,000 from their waged work and freelance activities and could document lost incomehttps://slks.dk/tilskud/stamside/tilskud/midlertidig-kunststoetteordning-for-kunstnere-med-kombinationsindkomster/. Multiple jobholders from other sectors were entitled to slightly different financial support as they had to document a lost monthly income of at least DK 10,000 per month in order to qualify for financial help.
The Danish government also extended workers’ rights to sick pay and suspended the rules that unemployment benefits and sick pay offered during the first months of the corona crisis would count towards calculating the maximum period for receiving these benefits. In addition, students – often working as atypical workers in crisis-ridden sectors – were granted the right to expand their student loans, and recipients of social assistance no longer had to comply with the so-called 225-hour rule of paid work to qualify. New rights were also adopted for parents with sick children, chronically ill people, workers at increased risk of serious illness if infected by Covid-19 and their relatives. These groups were guaranteed paid leave corresponding to sick pay if they had to stay at home during the reopening of Denmark, provided that they met the eligibility criteria for sick pay (i.e. on average 1o hours per week within the last five months – Ministry of Employment, Denmark 2020a). In the case of freelancers and solo self-employed workers, these criteria are an income corresponding to on average 18.5 weekly working weekly working hours for at least six months within the last year (Borger.dk 2020a). Thus, non-standard workers with contracts of few hours, short duration or freelancers/solo self-employed workers with low income may struggle to qualify for these schemes.
As part of the different series of stimuli was as well various tax referrals, the state backed loan guarantees and credits for companies that could document a loss of at least 30 per cent of their revenue due to Covid-19 (Andersen et al. 2020). There was also targeted support covering up to 80 per cent of fixed-running costs for companies that were ordered to close down and lost more than 40 per cent of their turnover, provided they submitted an audited statement of expected loss of revenue (Andersen et al. 2020). Solo self-employed workers were also welcome to apply for these schemes.
The help and relief packages initiated by the Norwegian government to protect jobs, support businesses and individuals and strengthen health care services were introduced in different stages, with the major packages launched on 13 March, 27 March and 3 April 2020. They amounted to more than NOK 139 billion, equivalent to 4.6 per cent of the mainland GDP, and have been continuously revised, broadened and prolonged as the corona crisis has evolved (Ministry of Finance, Norway 2020a).
The adopted economic measures include a temporary compensation scheme to secure access for self-employed workers and freelancers to income support and paid sick leave during the crisis. With the exception of freelancers, these groups are usually without rights to unemployment benefits in Norway. The temporary compensation scheme offers sickness benefits to freelancers and self-employed from their fourth day off sickness compared to the 17th day pre-Covid-19. This access to income support is novel in the Norwegian context as it allows self-employed and freelancers who have lost business income to receive up to 80 per cent of their lost income due to the corona outbreak or lockdown measures. Certain conditions apply. Only freelancers and self-employed aged 18–67 with an annual income of over NOK 74,849 from their self-employment or freelance business and who are willing to cover the first 16 days of income loss themselves are entitled to the new temporary income scheme (NAV 2020e). For start-ups or newly established freelancers, a shorter period for calculating their past earnings and income loss can be applied. The scheme also covers freelancers or self-employed people with income from traditional waged work, but their waged work will be deducted from their received compensation (NAV 2020e).
Other measures include an extension of the unemployment benefit scheme by granting benefits from the first day and increasing the daily allowance (Ministry of Finance, Norway 2020a). Temporarily laid-off workers are, irrespectively of their rights to unemployment benefits, guaranteed 100 per cent wage compensation with an annual salary cap of NOK 599,148 for the first 20 days after being temporarily laid off, where the Norwegian government covers 18 out of the 20 days (NAV 2020a). Thereby, these rule changes also entail that all non-standard workers are covered for the first 20 days they are laid off, which is unique not only compared to the temporary measures introduced in Denmark, but also in a Norwegian context. In Norway, the level of unemployment benefits is tied to past earnings and only employees earning at least NOK 149,787 within the last 12 months qualify for unemployment benefits (NAV 2020d). After the first 20 days, temporarily laid-off workers and ordinary unemployed that are covered by the Norwegian unemployment insurance scheme can receive unemployment benefits equivalent to 80 per cent of their former wages, provided they meet the eligibility criteria (Seip 2020). At the time of writing, the Norwegian government is expected to extend this period to 52 weeks from November 2020. These rules entail that some groups of non-standard workers (TAW, marginal part-time workers, on call workers etc.) may not qualify for unemployment insurance after the first 20 days as unemployed or temporarily laid off, as they are unable meet the eligibility criteria (NAV 2020b).
The temporary changes to the unemployment insurance scheme also apply to employees covered by the temporary lay-off/ short-term work scheme, if the affected employee continues to work 40 per cent or less of former work hours. All workers, including on-call workers and apprentices, can be covered by such a scheme introduced at their workplace. However, while the same level of wage compensation applies to laid-off on-call workers or part-time workers as other ordinary unemployed people, apprentices receive lower levels of wage compensation (Seip 2020; NAV 2020a). Other measures involve extended rights for parents to paid care days (from 5 to 10 days) that also apply to solo self-employed and freelancers. Further training measures, increased access to student loans for students experiencing job loss, along with temporary social assistance for people outside the EU/EEA area staying in Svalbard and suspension of childcare fees during the lockdown of childcare facilities, also formed part of the Norwegian help and relief packages (Ministry of Finance, Norway 2020a). Thereby, the Norwegian government has implemented a series of novel measures that also cover non-standard workers that usually are not entitled to financial support in case of unemployment (solo self-employed) or who may struggle to qualify for income support if dismissed or temporarily laid off (TAWs, posted workers, marginal part-time workers).
To keep crisis-ridden businesses afloat, the Norwegian government has also introduced a series of measures such as tax referrals, state-backed loans, investments in research and innovation, reduced employers’ contributions along with specific compensation schemes for day-care facilities, cultural, sports and voluntary sectors (Seip 2020; Ministry of Finance, Norway 2020a). These include a compensation scheme where the state covers up to 90 per cent of the fixed costs for otherwise sustainable companies that have experienced lost turnover of more than 30 per cent (20 per cent in March 2020) (Seip 2020). Self-employed and freelancers can also apply for these relief packages to cover costs, provided they meet the eligibility criteria.
On 16 March 2020, the Finnish government introduced a lockdown for a large part of the society, presented its three-stage strategy for the help and relief packages, and called upon social partners to discuss further emergency measures (Finnish government 2020). This series of policy responses was then presented on 20 March, 27 March, 3 April and 8 April 2020 (STTK 2020). The Finnish government has thus far adopted more than 20 economic and social measures worth more than EUR 15 billion. The policy responses were developed in close consultation with social partners and with the support from other political parties and were revised and extended to new groups as new containment measures were introduced (STTK 2020).
The first wave of policy responses was largely based on the joint proposals by Finnish social partners, which the government had urged them to develop at its press conference on 16 March 2020. These policy responses included reduced employers’ contributions, deferral of employers’ pension contribution payments for three months and relaxed rules and regulations around dismissals and temporary lay-offs of permanent staffThese temporary rule changes involved lowering the notice period for lay-offs to 2 days instead of the usual notice period of two weeks or more, shortening the social partners’ negotiations on lay-offs to five days rather than the “normal” period of up 90 days.. New temporary rights for employers to implement short-time schemes, dismiss fixed-term workers and to cancel a probation period for financial and production-related reasons were introduced. In return, the Finnish government made changes to the unemployment benefit system. All dismissed or temporarily laid-off workers, including groups such as students, fixed-term workers, TAWs, part-time workers and self-employed workers, gained the immediate rights to unemployment benefits from their first day as unemployed and could receive up to €65 per working day for 90 days. It was decided that corona-related new unemployment periods would not affect the number or earnings-based unemployment benefit days (Kela 2020b). Thus, the Finnish government temporarily suspended the various eligibility criteria for unemployment benefits that usually apply in Finland. In the case of freelancers and self-employed people, certain conditions apply. Solo self-employed workers and freelancers are temporarily entitled to unemployment benefits of up to EUR 33.6 per day without having to close down their business activities, provided they are not in full-time employment, are forced to reduce working hours or their income from their freelance or entrepreneurial business is less than EUR 1,089 per month due to the corona outbreak. Income from entrepreneurial activities is deducted from the unemployment benefits (Kinnunen 2020). This scheme is novel in Finland in that self-employed people “normally” have to suspend their business activities and, like employees, comply with various criteria to qualify for unemployment benefits (Finnish government 2020). Thereby, the large share of workers who has been dismissed, temporarily laid off or lost orders; and usually struggle to qualify for unemployment benefits, including non-standard workers, freelancers and solo self-employed, were now covered by the new temporary measures (Finnish Government 2020; Kela 2020b).
The Finnish government also temporarily lowered the eligibility criteria for unemployment benefits from 26 weeks to 13 weeks of employment during the past 28 months (Kela 2020b; Kinnunen 2020). Employers’ obligation to re-employ laid-off workers was also extended from 4 or 6 months to 9 months, and fixed-term workers acquired new temporary rights to terminate their fixed-term contracts (Finnish government 2020). In relation to sick pay, workers that had been quarantined under the Communicable Diseases Act were entitled to full wage compensation whereby non-standard workers that usually may not qualify for sick pay were entitled to compensation while on sick leave (Finnish Government 2020).
The next waves of Finnish help and relief packages included a financing model for crisis-ridden solo self-employed workers that allowed them to claim financial support of EUR 2,000 to cover fixed expenses such as rent besides their temporary rights to unemployment benefits (Finnish Government 2020). Certain conditions applied such as that only registered solo self-employed workers with entrepreneurial income of less than EUR 20,000 per year that had lost income due to Covid-19 and would otherwise be sustainable businesses qualified for the financial support (Kinnunen 2020). Part of these measures was also further financial support to Finnish companies, a family allowance of EUR 723 per month to parents unable to work as their children up to 10 years or with special needs were at home due to closed schools, daycare or care facilities (STTK 2020; Finnish Government 2020). The legal changes around laid-off workers’ rights to unemployment benefits, even if they were studying or engaged in business activities, along with the procedures for temporary lay-offs came also into force during this period. Thereby, the Finnish government expanded their social protection schemes to cover even groups that usually struggle to qualify for financial support when they lose their jobs or income or fall ill.
The series of policy responses also included various further training and employability measures for temporarily laid-off and unemployed people, along with different tax referrals, state-backed bank loans and financial subsidies to crisis-ridden companies with specific measures aimed at SMEs. A number of measures also specifically targeted crisis-ridden sectors, notably hotels and restaurants, tourism, the creative and performing industry, that were forced to close down during the lockdown. Unlike the other Nordic countries, only crisis-ridden Finnish businesses in these selected sectors could apply for financial support to compensate for lost turnover, fixed operating costs, cover costs for job retention and re-employment of employees once business commence, provided they had lost more than 30 per cent in sales and turnover due to the corona crisis (Finnish government 2020).
The Icelandic government, in close collaboration with social partners, launched more than 20 help and relief packages worth more than ISK 230 billion to protect workers, secure jobs and income, stimulate innovation and entrepreneurship as well as ensure the continued operation of companies. Many of these initiatives have been revised and extended as the corona crisis has evolved, and although most were set to end in late August 2020, several have been extended throughout the autumn of 2020 or even longer (Government of Iceland 2020b).
The first set of help and relief packages was presented on 21 March 2020. It included 10 measures, among them measures such as wage security for workers, freelancers and self-employed individuals in quarantine, a one-off means-tested child benefit payment to all parents with children under 18, and a publicly funded short-term work scheme for workers at risk of job loss due to the corona outbreak. The wage security for workers in quarantine ensured that they received pay equivalent to their total monthly wage, and employers were reimbursed for wage payments made to quarantined individuals. Freelancers and self-employed workers who were forced to stop working due to quarantine were entitled to 80 per cent of their average monthly income in the previous year to ensure that they adhered to health authorities’ instructions and to slow down the spread of Covid-19. An upper threshold of ISK 633,000 per month or ISK 21,100 per day applied to both self-employed workers and employees receiving payment during quarantine (Prime Minister’s Office 2020). Thereby, the Icelandic government introduced measures that cover all workers, including non-standard workers such as temporary employed, part-time workers, freelancers and solo self- employed in case they fell ill or were quarantined due to Covid-19.
The publicly funded short-term work scheme allows companies experiencing operational difficulties to request that their workers temporarily reduce working hours by up to 75 per cent provided they do not lay people off (Directorate of Labour Iceland 2020b). Affected workers are eligible for partial unemployment benefits that, combined with their wages, amount to 90 per cent of their average total wages with a salary cap of ISK 700,000 per month. Certain conditions apply, as individual workers’ hours have to be reduced by more than 20 per cent, but they have to retain a minimum of 25 per cent of their previous working hours to receive wage compensation. Employees with wages lower than ISK 400,000 per month are not subject to means testing (The Government of Iceland 2020a). The short-term work scheme also applies to part-time workers, students as well as solo self-employed, provided they meet the eligibility criteria. In the case of solo self-employed workers, certain conditions apply. Only self-employed people with substantial reductions in their operations and changes to their estimated income are eligible for partial unemployment benefit, but they are not required to cease their operations as is the “usual” practice when solo self-employed workers apply for unemployment benefits in Iceland (Directorate of Labour Iceland 2020b). Part of the first series of help and relief packages was also access to private pension savings, deferral of tax payments, refund of VAT for construction projects, auto repair and various other services, state-backed loans for companies, financial support for the tourism sector, artists and investment in technical infrastructure (Government of Iceland 2020a). Thereby, the Icelandic government introduced novel short-time work measures that also apply to many non-standard workers such as solo self-employed, part-time workers and students, which stand in contrast to the other Nordic countries, where solo self-employed cannot use short-time work schemes in times of crisis.
The second wave of help packages was launched on 21 April 2020 and comprised of a further 10 economic measures, involving e.g. financial support to compensate for lost revenue and cover fixed operational costs for companies that were forced to temporarily close down for public health reasons, provided they met the eligibility criteria. To qualify for these types of subsidies, businesses also had to have suffered at least a 75 per cent loss in revenue in April 2020 and had at least an annual revenue of ISK 4.2 million in 2019. The Icelandic government also offered support loans for small businesses with a loss in revenue of 40 per cent or more, along with various financial stimuli to the media and creative industry, food production industry and local governments to boost the economy and mitigate the social and economic effects of the corona outbreak. A one-off pay increment to front-line health care workers, various further training measures and targeted support to students, children and their families as well as vulnerable groups such as disabled, chronically ill and older people also formed part of this second phase of bailouts (Government of Iceland 2020b).
The third and fourth help and relief packages were announced on 28 April and 26 August and included changes to and extensions of the publicly funded short-time scheme. From July 2020, the lower threshold that employers could request their employees to reduce their weekly working hours and still qualify for partial unemployment benefits was increased from 25 per cent to 50 per cent of previous working hours and this scheme has recently been further extended until December 2020. New opportunities were introduced for companies that had lost more than 75 per cent of their revenue and project further revenue losses to apply for government support to cover parts of their laid-off staff’s salaries during their notice periods for up to three months with a pay cap of ISK 633,000 per month. Companies that receive such funds were obliged to reemploy the affected workers once business activities commence and guarantee that they retain their accrued rights (Government of Iceland 2020c).
Sweden did not have a lockdown to the same extent as seen in the other Nordic countries, but implemented a series of containment measures similar to its Nordic neighbours, including bans on large gatherings and social distancing measures. These policy responses were accompanied by extensive measures to tackle rising unemployment, protect jobs, provide income security for affected workers and weather viable Swedish businesses through the economic slowdown. This series of policy responses amounted to over SEK 100 billion where the main initiatives were introduced between 14 March 14 and 14 May 2020. Since then the various policy measures have been subject to revisions and extensions as the corona crisis has escalated in Sweden (Ministry of Finance Sweden 2020b; 2020a).
One of the main help packages introduced by the Swedish government was the system of financial support for temporary lay-offs and short-time work. This scheme enabled crisis-ridden companies to retain employees by reducing their working hours by up to 80 per cent, with the 80 per cent threshold covering only the period between May and July 2020 (initially set at 20 per cent then increased to 40 per cent and 60 per cent in Spring 2020). The Swedish government would then cover up to 75 per cent of the affected employees’ wages and thus ensure that these employees received more than 90 per cent of their wages with a pay cap of SEK 44,000 per month, excluding employers’ contributions. Thereby, the wage costs of employers could be reduced by half. For companies to receive financial support through the state-funded short-time work scheme, certain conditions applied. Crisis-ridden companies covered by collective agreement needed to ensure that the possibilities for short-time work were part of their collective agreements, while companies without collective agreement coverage were obliged to sign an agreement for short-time work that covered at least 70 per cent of all employees in the operating unit (Gustafsson 2020). Unlike many of the other Swedish help and relief packages, solo self-employed, recently employed with less than three months with the company and temporary workers could not be covered by the short-time scheme. In fact, crisis-ridden companies were mandated to lay off temporary workers and external consultants and thus minimise labour costs in order to qualify for financial support through the short-time scheme (Tillväxtverket, Sverige 2020b). Thus, the Swedish temporary short-time scheme mainly protected employees with open-ended contracts against unemployment and income insecurity, which stands in sharp contrast to the schemes in Norway, Iceland and Finland, where all workers, including most non-standard workers are covered in the first weeks of temporary lay-offs, provided they reduce their work hours in line with regulation.
Part of the Swedish policy measures were also that the central government temporarily covered employers’ sick pay expenses for up to two months, and that registered solo self-employed workers would be entitled to sickness benefit for the first two weeks of sick leave (Ministry of Finance Sweden 2020a). New rights to a temporary preventive sickness benefit and disease carrier allowance were introduced and provided paid leave for up to 90 days for all workers, including self-employed and casual workers that faced increased risks of falling seriously ill if infected with Covid-19 or who had been infected or suspected infection with Covid-19 (Gustafsson 2020). Temporary changes were also introduced to the unemployment benefits. For example, the initial six-day waiting period for unemployment benefits was suspended and both the minimum and maximum levels of compensation were increased to provide greater income insecurity for people losing their jobs (Gustafsson 2020). Moreover, the eligibility criteria for unemployment benefits were lowered from the initial requirement of 12 months’ membership of an unemployment benefit fund to a situation where each month an individual had been a member counted as four months for the period. This enabled members to qualify for unemployment benefit within only three months (Gustafsson 2020). In addition, the number of accrued working hours needed to qualify for unemployment benefits was reduced to 420 hours within the last six months of requesting at least 40 working hours within one month, compared to the usual rules of 480 hours in at least six months with a minimum 50 working hour per month (Government of Sweden 2020c). These various legal changes and new temporary allowances were enacted to ensure access to income security in case of job loss for a larger number of part-time workers and other atypical workers. However, in the case of unemployment benefits, some groups of non-standard workers, notably those with contracts of few hours and short duration, may still have struggled to meet the temporary eligibility criteria of on average 17.6 hours per week over a six-month period and thus accrue rights to unemployment benefits (Government of Sweden 2020c).
Other policy measures enacted by the Swedish government to assist Swedish businesses and workers included tax referrals, lower tax instalments, state-backed loans and credit guarantees, various funds strengthening workers’ employability and creating extra jobs, especially for students, along with targeted support to SMEs, the airline, creative and cultural industry (Government of Sweden 2020c). These financial measures included among others temporary cutbacks in employers’ social contributions, which also applied to solo self-employed (Gustafsson 2020). Moreover, companies in certain vulnerable sectors such as retail, hotels and restaurants could receive financial support to cover up to 25 per cent of their fixed rental costs with an upper limit of EUR 800,000, provided they had seen significant drops in their economic turnover (Gustafsson 2020).
Some of the listed help and relief packages are more relevant for non-standard workers than others. However, common for all five Nordic countries is that innovative policy responses have been adopted to expand the coverage of the Nordic income security schemes to groups often operating on the fringes of the Nordic labour market models. Targeted support for students, SMEs, freelancers, solo self-employed, part-time workers with few hours and employees and companies in the creative and cultural industry, tourism/transport (ref aviation), retail, hotels and restaurant sectors is seen in all five Nordic countries. The sector-specific measures also appear relevant to many non-standard workers as they often work in these sectors (see chapter 3–7). The key question remains as to what the take-up and effects of these unprecedented measures have been for non-standard workers’ income and employment security across the Nordic countries.
It is still too early to assess their long-term effects, but a number of analyses and surveys for individual countries point to that some measures have been more successful than others when measured in terms of take-up rates and coverage. The fact that various eligibility criteria usually apply to qualify for sick pay and unemployment benefits such as membership of an unemployment insurance fund (Denmark, Finland, Sweden), requirements of past employment records and weekly working hours (Denmark, Finland, Iceland, Sweden) or past earnings (Norway, Sweden, Denmark, Finland, Norway) may influence the take-up. Most Nordic governments have temporarily suspended these restrictions for sick pay (Norway, Finland, Iceland, Sweden) and unemployment benefits (Finland, Norway, Iceland, Denmark) or temporarily lowered the eligibility criteria (Sweden, Denmark, Finland). In fact, in the first two quarters of 2020, Denmark was the only country where the usual requirements for past employment records and weekly working hours continued to apply. Later, like the other Nordic countries, Denmark suspended or relaxed these regulations. Yet, some groups of Danish non-standard workers, for instance part-time workers with contracts of few hours, freelancers and temporary workers may still have struggled to qualify for sick pay or unemployment insurance, as they were unable to meet the eligibility criteria for accrued working hours. Similarly, in Sweden some groups may also have struggled to comply with criteria for accrued working hours, although the Swedish government lowered such eligibility criteria and eased access to unemployment benefits.
State-funded short-time work, lay-offs or wage compensation schemes of one form or the other have been implemented in all the Nordic countries. All five governments have also relaxed access to such schemes and provided public funds beyond the usual arrangements to ensure income security for temporarily laid-off workers. In Iceland these schemes have also been extended to solo self-employed workers. In Denmark, the government introduced a wage compensation scheme that protected the income and job security of workers in crisis-ridden companies, which in many ways equals the job retention schemes introduced in the other Nordic countries. Recent figures suggest that these short-term and wage compensation schemes have been fairly successful when measured in terms of take-up. Around 371,488 workers in Norway, 292,165 in Denmark, 577,090 workers in Sweden, 158,100 in Finland and more than more than 35,000 workers in Iceland were temporarily laid off and have received wage compensation or unemployment benefits through these schemes (STAR 2020b; Statistics Denmark 2020q; Tillväxtverket Sverige 2020a; NAV 2020p, Government of Iceland 2020b). These figures are equivalent to 6.3 per cent of all employed in Finland, 10 per cent in Denmark, 11 per cent in Sweden, 14 per cent in Norway and 18 per cent in Iceland. However, these lay-offs/short-term work schemes tend to apply mainly to permanent full-time or part-time staff except in Iceland, where also solo self-employed workers are covered. In Denmark, temporary workers cannot be part of either the short-time schemes or the wage compensation schemes. Therefore, temporary workers are without protection from being dismissed as a precondition for crisis-ridden companies to receive financial support is that they do not lay off people covered by the schemes. In Sweden, crisis-ridden companies are mandated to dismiss temporary workers and external consultants and in other ways curb labour costs in order to qualify for financial support through the scheme, and in return workers covered by scheme are protected against dismissal. In Norway, Finland and Iceland all temporarily laid-off workers irrespective of their employment contract are covered with wage compensation in the first weeks of their lay-off, which stands in sharp contrasts to Sweden and Denmark, where specific criteria apply. Therefore, many non-standard workers such as temporary workers in Denmark and Sweden may experience higher risks of job loss and lower levels of income support compared to their peers in the other Nordic countries, at least during the first weeks and months of the corona crisis.
The various financial support schemes have also been used and well received by Nordic companies. In Finland, more than 75 per cent of 4,700 SMEs stated that the COVID-19 support measured had met their needs well or somewhat well and especially the increased possibilities for temporary lay-offs and eased dismissal criteria had helped business to protect jobs, but many companies also called for increased flexibility (MEAE 2020e). Around 27 per cent of the sampled Finnish SMEs had found the shorter notice periods helpful and 16 per cent stated that the possibilities to lay off staff on financial grounds had been vital to prevent company closure (MEAE 2020e). In addition, many Finnish solo self-employed workers have utilised the new opportunities for income support with 32,000 having received unemployment benefits and 20,000 had applied for financial support to cover their fixed expenses under the new fund set up for solo self-employed (Kinnunen 2020).
In Denmark, around 32,109 companies have received wage compensation for more than 282,178 jobs between 9 March and 31 August 2020, which amounted to more than DKK 12.33 billion (Statistics Denmark 2020q). In more than 70 per cent of the companies that had received wage compensation, more than one in two employees had received wages through the scheme. The restaurant sector had most companies (2,500 restaurants) receive wage compensation for 22,700 jobs followed by hairdressers and private dentists (Nielsen & Hansen 2020). Also in Danish manufacturing did we see a large share of workers being covered by the wage compensation scheme, but here it is fewer and mainly larger companies that have applied for support to cover part of their workers’ salaries. This may also partly explain the rising part-time figures in Danish manufacturing and the declining numbers of temporary workers in the second quarter of 2020 as the latter cannot take part in either the wage compensation or the short-time schemes.
Quite a few micro companies (44 per cent) have utilised the wage compensation schemes to cover wages for more than 75 per cent of their staff. Around one in five start-up companies, especially in the hotel and restaurant sector, received wage compensation for their employees during the first months of the corona outbreak (Nielsen & Hansen 2020). By comparison, nearly one in ten self-employed received compensation under the help and relief package explicitly aimed at solo self-employed, freelancers and micro companies between March and June 2020 (Nielsen 2020). However, there is also a large group of start-up companies, freelancers and solo self-employed workers that struggled to qualify for the various relief and help packages. Many found the application process too complex or were unable to meet the eligibility criteria, not least the requirements of documented loss of revenue and minimum annual turnover (Ilsøe & Larsen 2020a).
In Sweden, around 69,820 companies had applied for financial support through the short time scheme covering more than 577,090 employees by July 2020, which amounted to more than SEK 29 billion. Particularly companies within the sectors of retail (12,558 companies), legal, financial and technical services (13,878 companies), hotel and restaurants (7,751 companies) and manufacturing (6,260 companies) have used the short-time work schemes. These have covered 60,805 workers in the legal, financial and technical sector and 172,616 workers in Swedish manufacturing (Tillväxtverket, Sverige 2020a).
In Norway also, many companies have utilised the short-time schemes. 6,825 Norwegian companies applied covering more than 374,000 workers during the peak of applications in March and April 2020 (NAV 2020f). Recent figures also suggest that around NOK 1.08 billion has been allocated to 22,429 freelancers and self-employed that have applied for income support through the help and relief package specifically targeting them Each freelancer and solo self-employed worker has on average received NOK 48,000 and the peak of applications was in May and June 2020 (NAV 2020g).
In Iceland more than 1,300 Icelandic companies have applied for tax referrals and more than 35,000 workers have applied for top-up of their wages through the government-funded short-time scheme. However, figures on how many Icelandic companies including freelancers and solo self-employed workers that have applied for government funding are not yet published (Government of Iceland 2020b).
The corona crisis has hit the Nordic economies hard, and in most instances harder than the financial crisis in 2008 when measured in terms of real GDP growth. The economic slowdown has been accompanied by rising unemployment, especially in tourism, retail, hotels and restaurants and large parts of the creative industry where non-standard workers are overrepresented. Nordic governments have launched a series of unprecedented