From Substitutive to Supplementary: Institutional Interplay between Public and Occupational Sickness Benefits in Finland, 1947-2016
| DOI | 10.1177/1388262720988295 |
| Date | 01 March 2021 |
| Published date | 01 March 2021 |
| Subject Matter | Articles |
Article
From Substitutive to
Supplementary: Institutional
Interplay between Public and
Occupational Sickness
Benefits in Finland, 1947-2016
Laura Ja
¨rvi
PhD Candidate in Department of Social Research, University of Turku, Turku, Finland
Abstract
In the context of the Finnish welfare state, this article examines the role of occupational welfare in the
interplay between public and occupational sickness benefits from 1947 to 2016, to analyse how the two
sickness benefits have interacted over time and th e role occupational welfare has played in sickness
provision. Previous research has noted that occupational benef itsmay support or compensate for the
much-debated declining welfare state. Hence, it is important to acquire greater knowledge about the
public-occupational interplay. The study uses in-depth individual-level analysis from a retrospective
point of view, which has been rare in previous research, and examines the public-occupational
interplay in the Finnish sickness benefit system from the first national collective agreements to
2016. Based on the reforms made to the public system, the article identifies and utilises six different
phases of theFinnish sickness allowancesystem in the main analysis.The institutional developmentof
sickness provision is investigated by analysing the compensation rate and benefit period, using
metalworkers as a representative example of blue-collar workers. The results indicate that occupa-
tional benefits are strongly institutionalised in the Finnish sickness benefit system. The interplay
between statutory and occupational sickness benefits has taken different forms over time, and
occupationalbenefits have been re-negotiated as the statutory system hasbeen reformed. The article
providesvaluable information on thehistorical developmentand relevance of occupationalwelfare, in
terms of notonly understanding its significance for individualsbut also comprehendingthe logic of the
interplay in the public-private mix of welfareprovision.
Keywords
Occupational welfare, sickness benefits, welfare state development, Finland
Corresponding author:
Laura Ja
¨rvi, Department of Social Research, FI-20014 University of Turku, Finland.
E-mail: laura.jarvi@utu.fi
European Journal of Social Security
2021, Vol. 23(1) 62–80
ªThe Author(s) 2021
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DOI: 10.1177/1388262720988295
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1. Introduction
In most welfare states, social provision is based on a multi-tiered system comprising a mix of
actors, including the state, employers, social partners, and individuals. The different layers of the
mix have developed over time, forming an interplay unique to each country and time and place.
The role of the state and the markets lies at the heart of the ongoing discussion of how to provide
welfareinthefutureandtowhom.Recently,researchershavestartedtopayattentiontotherole
of occupational welfare, an important factor in many countries, in either supplementing or
substituting public provisions. Occupational arrangements may play an important role in
ongoing welfare state transformations, such as by compensating for the gaps in, or cuts to, public
welfare provision (e.g. Johnston, Kornelakis, & d’Acri, 2011; Trampusch, 2006, 2007a, 2007b;
Yerkes & Tijdens, 2010; Natali, Pavolini, & Vanhercke, 2018a). It has even been argued that
social policy based on collective agreements can support and accelerate welfare state retrench-
ment policies and can thus form part of Pierson’s (1996) ‘new politics of the welfare state’
(Trampusch, 2006).
Despite the growing interest in occupational welfare, the information available is still relatively
narrow, largely due to limited data. Information on different kinds of occupational schemes is
either not readily available or available but scarcely comparable. In general, the tendency has been
to analyse occupational welfare in a broader context, for example by examining macro-level data
such as social expenditure on occupational welfare (e.g. Greve, 2007; Natali & Pavolini, 2014;
Natali et al., 2018a). These studies have provided important insights into the general trends in the
public-occupational interplay in Europe; however, in-depth individual-level analysis has been rare,
especially from a retrospective point of view. This article aims to fill this gap. A retrospective
study enables us to investigate the development of the interplay over time in a way that is not
possible in cross-sectional research. This article examines the public-occupational interplay in the
Finnish sickness benefit system over an exceptionally long period of time, from the first national
collective agreements in 1947 to 2016.
Most of the research on occupational welfare has focused on occupational pensions (e.g. Shalev,
1996; Rein & Wadensjo¨, 1997; Ebbinghaus, 2011; Pavolini & Seeleib-Kaiser, 2018; Natali et al.,
2018a), though some studies have examined other social policy fields such as family policies (e.g.
Seeleib-Kaiser & Fleckenstein, 2009, 2011; Chung, 2018; Wib& Greve, 2019) and unemployment
(e.g. Natali et al., 2018a). This article focuses on one aspect of social policy that has received less
attention (see Jarvi & Kuivalainen, 2013; Grees, 2015): the role of occupational welfare in the
sickness benefit system. In most European countries, sick pay arrangements are among the occu-
pational benefits that are most commonly negotiated through collective agreements, and sickness
provision forms a field of social policy where interplay usually exists.
The importance of occupational welfare varies between countries and the social policy field in
question, but it has grown in almost everywhere in Europe (Natali, Pavolini, & Vanhercke, 2018b).
This is also the case in the Nordic countries, which have traditionally been characterised by a
strong state, a high degree of universalism, social rights, and corporatism (e.g. Esping-Andersen,
1990). Occupational welfare has implications for inequality by increasing dualisation not only
between those in and out of work but also between people participating in the labour market (e.g.
Seeleib-Kaiser, Saunders, & Naczyk, 2012). Research suggests that this is also true to some extent
in the Nordic welfare states, as occupational welfare affects the key principle of universalism
(Kvist & Greve, 2011; Jarvi & Kuivalainen, 2013; Greve, 2018). However, more knowledge is
needed about the precise role of occupational welfare in these welfare states.
Ja
¨rvi 63
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