Palkkakierrokselle

Palkkakierrokselle is a Finnish term used to describe the periodic process in which employee salaries are reviewed and adjusted within organizations. It is typically an annual cycle, though the exact timing can vary by sector, contract, and company policy. The aim of palkkakierros is to ensure compensation reflects the employee’s responsibilities, performance, experience, and the external market, while supporting internal pay equity.

The process usually involves collaboration between human resources, line managers, and, in many cases, employee representatives. Preparations include performance assessments, updates to job descriptions, and benchmarking of market salaries. Based on these inputs, decisions are made about salary increments, merit-based raises, or market adjustments. Outcomes can include a regular annual raise, a one-time adjustment, or a combination, and the specific amounts and timing differ across organizations and agreements.

Legal and sector context: In many Finnish workplaces, palkkakierros operates under a collective agreement (TES) that may set minimum increases, criteria, and steps in the process. Differences between private companies, municipalities, and government agencies are common, and some workplaces rely more on internal guidelines than on formal negotiations.

Impact and considerations: Palkkakierrokselle affects recruitment, retention, and motivation, and it can raise concerns about transparency and equity, including gender pay differences. Clear criteria, predictable timing, and open communication are often emphasized to maintain trust and fairness in the process.