Appeals court overturns pay dispute ruling, leaving caregivers liable for employer’s legal costs

A Finnish appeals court has reversed a lower court’s decision in a pay dispute, ruling that six caregivers are not entitled to back pay and must instead cover their employer’s legal fees of around €25,000, Yle reports.

The Turku Court of Appeal overturned a Pirkanmaa District Court ruling that had ordered Kolmostien Terveys Oy, a social and healthcare company, to pay nearly €59,000 in compensation to six caregivers for unequal pay. The district court had found the company violated equal treatment obligations by paying newer employees lower wages than those transferred from municipal service in 2015.

However, the appeals court determined that the pay difference stemmed from a legitimate business transfer and that the company had taken reasonable steps to address the disparity. The ruling was not unanimous, with one judge dissenting and supporting the original district court decision.

The caregivers, employed between 2015 and 2020, had demanded the same transitional allowance granted to two senior colleagues whose terms were preserved under labor law when services were transferred from Parkano municipality to the company. The appeals court cited Supreme Court precedent, stating that employers may set independent pay policies after a business transfer.

While the company had not immediately equalized wages, the court found it had made sufficient adjustments by standardizing role-based pay in 2018 and further narrowing gaps in 2021 and 2023. The caregivers now face joint liability for the employer’s legal costs, totaling approximately €25,000, unless they successfully appeal to the Supreme Court.