The new Workers' Compensation Act has entered into force. The new act applies to insurances which came into force after January 1 2016 and for accidents which happened after January 1 2016.
Workers' compensation insurance (statutory accident insurance) is mandatory for Finnish employers. It covers occupational accidents and disease and is the oldest part of the Finnish social security system. Statutory accident insurance was introduced in Finland in 1895. At the time, Finland was one of the first countries in the world to have an insurance compensation system covering workplace accidents. Initially, the insurance covered only the most dangerous physical jobs.
The previous Workers' Compensation Act dated back to 1948 and although it had been heavily amended over the years, it was out of date and difficult to understand. As it is the law and not insurance conditions which regulates everything from insurance relations to compensation, it is important to have a clear and up-to-date act. The law drafting work took almost 10 years.
The act's purpose is to update legislation to meet the requirements of today's working environment. It takes into account that employees often work elsewhere than their regular workplace (eg, at home, on assignment abroad or on a business trip).
The act has codified prevailing court and compensation practice. The new act (which has 286 paragraphs) is clearer and more accurate and coherent than the previous act (which had 130 paragraphs). The fundamental principles (eg, financing, compensation and enforcement) of the compensation system remain unchanged.
The act specifies which workers are insured, as well as the circumstances under which accidents and occupational disease are covered. It marks the first time that the term 'accident' has been defined in law. According to the act, 'accident' means a sudden and unforeseen event caused by an external factor, which causes injury or occupational disease to an employee. In order to be covered by the insurance, the act defines when there is causality between the event and an injury or occupational disease.
The act speeds up claims handling by shortening deadlines. Claims handling should commence immediately and no later than seven days of the notice of claim. A decision must be given no later than one month of the receipt of the claims documents – the previous time limit was three months. The new act requires that negative decisions be justified more precisely.
When the new act entered into force, the Federation of Accident Insurance Institutions changed its name to the Finnish Workers' Compensation Center (TVK). The TVK coordinates the application of workers' compensation and all insurers underwriting workers' compensation insurance in Finland must be TVK members.
For further information on this topic please contact Matti Komonen at Hammarström Puhakka Partners, Attorneys Ltd by telephone (+358 9 474 2207) or email ([email protected]). The Hammarström Puhakka Partners, Attorneys Ltd website can be accessed at www.hpplaw.fi.
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