Tackling the grey economy with occupational safety and health inspections

As with other countries, Finland has in recent years experienced a growth in the use of undeclared labour. One way to tackle the problem is by tightening up occupational health and safety inspections of working conditions, says Markku Marjamäki.

The issue of the grey economy made headlines at the end of September this year when a surprise occupational health and safety inspection of the building site of Teollisuuden Voima's nuclear power station at Olkiluoto found some 15 unregistered firms using foreign labour operating at the site.

Markku Marjamäki, Head of the MSAH's Field Operations Unit of the Department for Occupational Safety and Health, says that occupational safety and health authorities have a specific role to play in tackling the grey economy, alongside the police, tax authorities and social partners.

"The grey economy represents a serious societal problem that eats away at the whole of society. It is so intricately tangled that no single authority is able to eliminate it by itself."

In Finland , too , occupational safety and health oversight places the onus of responsibility on employers, and this can expose situations where undeclared labour is being used. Such oversight can check whether employers are using foreign workers who have work permits, and whether employers pay the wages and benefits that have to be paid in the Finnish labour market. Checks can be made of employers to ensure that they use subcontractors who pay taxes and social security fees and follow work contracts required by law.

Legislation on contractors' obligations is being strengthened and more resources are being secured for the Regional State Administrative Agencies to deal with undeclared labour and the grey economy. The MSAH's Department for Occupational Safety and Health directs the regional administration of occupational safety and health, and the Regional State Administrative Agencies are in charge of the practical inspection of workplaces.

Marjamäki points out that there are roughly 250,000 workplaces in Finland and that each year regional administrative authorities conduct about 20,000 workplace inspections. "The big question is that of choice: what workplaces to direct inspections at and what issues to target."

He says that though it is impossible to visit all workplaces, occupational safety and health officials are able to keep up with the demand for their services. Each year they receive some 70,000 requests for assistance, and all those concerning matters of interpreting regulations or requests for action are handled without delay. Most matters can be dealt with by phone, but some require more thorough investigation. "We first try to get firms to solve issues themselves. When necessary we carry out investigations and inspections, on the basis of which we give employers instructions on what to do."

Marjamäki says that workplace inspections generally take place by prior arrangement with employers, a tactical approach that influences employers' behaviour by getting them to take care of their statutory obligations.

"We don't carry out that many inspection raids, which are common in South Europe. But due to the grey economy there are more surprise inspections. We're on the lookout for employers who do not comply with the law and who try to conceal it from us."

The case of Teollisuuden Voima, which is still under investigation, was one such effort and a clear sign of the times. "In this situation there were a lot of inspectors from Helsinki and Turku there without prior notification," says Marjamäki. "We wanted to get an overview of who was working at the construction site. The inspectors were not able to gain immediate access, even though we had police backup."