Kela unlawfully fired long-term employee over remote work dispute, Labor Court rules

The Finnish Social Insurance Institution (Kela) has been found to have acted unlawfully in dismissing a long-term employee. The employee, who had worked at Kela's debt collection center since 1999, was terminated in March 2024 after Kela cited excessive breaks and neglect of duties during remote work. However, the Labor Court has overturned this decision, ruling that Kela's evidence, primarily based on the Oiwa time-tracking system, was insufficient to prove the employee was not working.

The court found that Kela's interpretation of the system's "orange line" – indicating periods of inactivity – was flawed. This line could appear even when the employee was actively engaged in work that wasn't captured by the system, such as reading documents, investigating cases, making calls, or assisting colleagues. Crucially, the court noted that the employee's workload or performance had not shown any decline during the period in question, and they had previously received positive performance reviews.

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The court found that Kela's interpretation of the system's "orange line" was flawed. This line could appear even when the employee was actively engaged in work that wasn't captured by the system.

Furthermore, Kela's handling of the dismissal process was criticized. The court pointed out that Kela failed to issue a warning before termination and initiated the dismissal procedure too hastily without thoroughly investigating the employee's actual work practices or exploring alternatives. This rushed approach, coupled with insufficient evidence, led to the ruling that the dismissal was unlawful.

As a result, Kela has been ordered to pay the former employee approximately 50,000 euros, equivalent to 18 months' salary after deductions for unemployment benefits. Kela also incurred significant legal costs, over 41,000 euros, for the professional association's legal expenses. This case highlights the importance of fair procedures and reliable evidence in employment termination, especially in the context of remote work and evolving monitoring technologies. The decision serves as a reminder that employers must have concrete proof and follow due process before dismissing long-standing employees.

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Kela did not give the employee a warning before the dismissal. The court also criticized that Kela initiated the dismissal procedure quickly and did not properly investigate the employee's work in practice or alternatives to ending the employment relationship.