Insurance supervision

In accordance with the Workers’ Compensation Act (TyTAL), the Workers’ Compensation Center (TVK) must supervise that the employer meets its insurance obligation. 

The labour protection authority must also monitor employers in order to ensure that they have a valid statutory workers’ compensation policy. The labour protection authority notifies TVK without delay where there is reason to believe that the employer has not fulfilled its insurance obligation. 

The insurance companies, on the other hand, supervise that the employer who has taken out an insurance policy from the company fulfils their statutory obligations concerning insurance coverage. For example, they can monitor payroll amounts in order to ensure that the wages and salaries declared for the insurance policy are accurate and underinsurance has not occurred. 

Supervisory measures

The supervisory measures carried out by the Workers’ Compensation Center include preventative and retrospective actions. 

Preventative actions include providing information about the insurance obligation through a number of communication channels. 

Retrospective actions refer to the mass supervision carried out by TVK using the data saved in the insurance register. For several purposes, such as insurance supervision, TVK maintains a register of employers who have taken out statutory compulsory insurance cover for their employees. 

TVK also carries out retrospective supervision in collaboration with other supervisory bodies, such as the Finnish Centre for Pensions, the Unemployment Insurance Fund, the Regional State Administrative Agencies and the Shadow Economy Investigation Unit. 

In addition, TVK investigates the cases that have triggered a warning, such as issues flagged in claim processing or reported through whistleblowing or surveys. 

Sanctions arising from negligence

Payment equivalent to the insurance premium

An employer who has failed to fulfil their insurance obligation is liable for paying a fee which corresponds to a reasonable insurance premium for the period of such failure (a payment corresponding to the insurance premium). The payment is imposed for the current and five previous calendar years. 

Penalty fee

In addition, the employer is liable for paying a penalty fee which is up to three times the amount of the fee corresponding to the insurance premium. The amount of the penalty fee depends on the duration of the failure, intent and frequency of the failure, amount of work without insurance coverage and the risk. 

The penalty fee may optionally not be imposed on a natural person only, provided that the negligence cannot be regarded as intentional and the imposition of a penalty fee would have been unreasonable. Otherwise, when failure to fulfil the insurance obligation has been established, the employer is always liable for paying the penalty fee in addition to the fee corresponding to the insurance premium. 

Determination of fees

TVK submits an application to the Treasury in order to determine the fee corresponding to the insurance premium and the penalty fee. 

The Treasury decides whether the employer has failed to fulfil the insurance obligation and orders the defaulting employer to pay the fees to TVK. The employer may appeal the Treasury’s decision by lodging an appeal in writing to the Employment Accidents Appeal Board.

Accident insurance fraud

The Finnish Criminal Code contains provisions on the sentencing for accident insurance fraud. An employer or employer representative who by neglecting the obligation to provide insurance avoids or attempts to avoid the imposition of the insurance premium is guilty of accident insurance fraud. 

Those guilty of accident insurance fraud may be sentenced to a fine or imprisonment for at most one year. 

Excess in claim events

If TVK pays compensation for a claim event that has occurred during work for an employer who has neglected to pay compensation, TVK will charge the employer for the actual cost of medical treatment for which compensation must be paid. The excess which the employer is liable to pay does not exceed 5,000 euros per claim event. 

Employee’s forfeiture of the right to compensation

An employee is not entitled to compensation for a claim event if the insurance has been neglected by common agreement by the employer and the employee as part of the failure to provide other statutory social security. The employee has, therefore, been aware of the negligence and by his or her own actions made it possible for the negligence to take place, thus benefiting from the payment of the employee’s earnings-related pension contribution and unemployment insurance contribution. 

Enforced insurance

If an employer fails to comply with the insurance obligation and does not rectify the failure within the given time limit, TVK will, at the expense of the employer, take out the compulsory insurance provided by its chosen insurance company.

Modified 04.12.2015