Light entrepreneurs are being concealed

“Nepalese people were working as light entrepreneurs at a major pipe renovation site in the capital region. They were international university of applied sciences students who were permitted to work an average of 30 hours per week in any field. They had found the job on social media.

The Finnish Construction Trade Union’s whistleblowing channel received a report about a construction site where no Finnish was spoken, and the workers had no visible identification cards. When union officials visited the site, it became apparent that the workers were using workwear, Valtti cards, and tools belonging to a construction company owned by an Estonian citizen. They were also working under the supervision of that company. At the site, it was difficult to ascertain who was the main contractor and what roles other companies had assumed. The union discovered that the Nepalese workers had been supplied to the construction site by a subcontractor of a secondary contractor. According to the Vastuu Group’s Luotettava Kumppani (Reliable partner) service, the financial statements for the subcontractor in question state that it has 0–4 employees, but 110 valid Valtti cards.

After speaking to the workers, it became clear that incorrect wage payment information had been reported for the construction site. In reality, the workers were light entrepreneurs and received remuneration of €15 per hour from an invoicing service company.

The light entrepreneurs were removed from the construction site. The Finnish Construction Trade Union submitted a request for an inspection to the Finnish Supervisory Agency’s Occupational Safety and Health department.”

You cannot rely on a Valtti card alone

Why weren’t the workers reported correctly for the site?

– There are usually several reasons. The contract agreement permitted the chaining of work to a single subcontractor, and that clause had been violated. Another probable reason was the low invoicing rate of 15 euros. The worker’s actual earnings were significantly below the minimum wage set out in the collective agreement, as that amount must also cover insurance and invoicing service fees, among other things, says senior specialist Markus Ainasoja from the Finnish Construction Trade Union’s international labour unit.

Sometimes foreign workers don’t even realise that they are light entrepreneurs. What was the situation in this case?

– They were aware that they were light entrepreneurs, but didn’t fully understand the concept of light entrepreneurship, or the responsibilities it involves.

How is it possible that Vastuu Group Valtti cards are awarded to more people than there are working at the company?

– There are such large numbers of workers that Vastuu Group is simply unable to check everyone. The newer Luotettava Kumppani 2.0 service is better in this regard; the service retrieves the company’s staff numbers from financial statements and the information is obtained again every year. Of course, staff numbers can vary over the course of a year, but not by hundreds, explains Ainasoja.

According to Ainasoja, clients should be aware that a Valtti card alone isn’t a reliable indicator of whether workers are actually employed by the company stated on the card.

– Responsible companies have to do a little more work. I recommend that contractors require use of the Luotettava kumppani 2.0 service.

Ainasoja also points out the risk that contractors are taking when such activity is detected on sites.

– The housing company took an enormous risk at this site. The Act on the Contractor’s Obligations and Liability when Work is Contracted Out stipulates that contractors must not agree on contracts that are clearly underpriced. The Act also requires that before an agreement is concluded, the contractor must obtain a trade register extract, a certificate of tax compliance, proof of registration on the register of employers and prepayment register, proof of VAT liability on the VAT register, pension insurance documentation, and documentation stating the collective agreement applicable to the work. As the contractor was entirely unaware of the use of light entrepreneurs, there is a risk that the authorities will issue a negligence penalty of up to €20,000.