Showing posts with label lomaraha. Show all posts
Showing posts with label lomaraha. Show all posts

Friday, July 30, 2010

Finland's hotest days

Forest fires are raging in Russia as temperatures crossed 40 C. The forests are like tinderboxes.

Finland was no worse yesterday, knowing the hotest day in this century from 1914 with the thermometer rising to 38 C.

Today it is both hot and humid, worse than the worst you get in Mumbai post-monsoon.

The Finns are reveling in the heat. Many may not go back to work on 2nd August if this weather continues.

That brings me to the basis of the one month's extra salary a Finn receives as "Holiday Money".

In the old days, after the war, almost all Finns took the month of July as holiday. The industrial activity would ground to a standstill.

If the sunny weather continued till the end of July, many many Finns would not report back for work in August.

To get them back to work, the companies started a bonus of paying a onth's salary to all those who did get back to work. It was called "LOMA RAHA". Although this was subject to 50% taxation, it was quite an incentive to get many Finns back to work.

However, over the years this became a worker's right and it got built into the system

That meant companies were paying 13 month's wages for 11 months work. This was specially hard at the time of the 1990 recession which was probably the longest and deepest in Europe.

Hence the sytem changed and now many companies do not offer this "Holiday Money" incentive and this is one reason why Finland uses a lot of outsourced workers in many different fields as they are not able to get this incentive in their pay packet.

When I was working in the University of Oulu, I was a double beneficiary. I never took my annual hlidays inJuly. that meant I got my holiday money and i was entitled to an extra week's holiday in winter. This meant I enjoyed 5 weeks holiday and as I could one week off for Christmas and New Year, I got 6 weeks instead of 4 plus an extra month's wages! Not bad!

I think much of this has changed today!

Sunday, June 27, 2010

The background to "Loma raha"

Many of you have been asking me as to the background to the "lomaraha" that many Finns receive. It is equal to a month's extra salary (but taxed at 50%). The translation means "Holiday Money".

In the old days, Finns would take the whole month of July of from work, to recover from a hard winter and to enjoy the summer sunshine. Work in the entire country would drag to an almost full stop as the Finns pushed off to their holiday homes, etc.

If the summer had been great and the look of August being an Indian Summer was a prospect, many Finns would not turn up for work on the 1st of August.

The Finnish companies had a real problem as this is a small country and every person's input counted.

To counteract this trend, the employers started an incentive called "Holiday Money".

If the people came back from their holiday on the 1st of August, they got a bonus of a month's salary.

This practice continued till finally it became enshrined as a worker's right.

Soon, everyone was getting an extra month's salary as "Lomaraha".

For 11 month's work the Finns got 13 month's salary.

I do not know if this system is still prevalent, but all through my working life I did enjoy the extra month's salary.

In my case, as I did not take my annual holiday in July, I got an extra week's holiday in December. Instead of 4 weeks paid annual holiday, I got 5 weeks. With one week off for Christmas and New Year, that made it 6 weeks. As I planned to give some lectures in India or UK, I got one week extra as a working week off from work - making it 7 weeks. 13 months salary for 10 months and 1 week work!!!!

Of course, this old man is now on a perpetual holiday! :-)