Migrant construction workers are modern slaves

By Minna-Riikka Härkönen and Petra Piitulainen, group 4

EU enlargements to Eastern Europe have led to structural change in construction industry all over Europe. Migrant workers from Estonia are conquering field of construction in Finland, while every fifth Finnish construction worker is jobless, but at the same time for example Romanian and Polish work at Estonian construction sites.



The President of The Finnish Construction Trade Union Jukka-Pekka Simpanen estimates that there are approximately 15 000 Estonian workers in Finland. There are no exact figures because numerous employees are working illegally. They make inspections, visits and raids to construction sites and collect information. Authorities do not have effective system to supervise underground economy.


Illegal employees are facing many troubles

  • Unrestricted working hours or days
  • Salaries under minimum wage
  • No overtime or holiday compensations
  • No occupational health care
  • No protection against unilateral


Some of the companies in underground economy are foreign, registered mostly in Estonia. Nevertheless some of those companies have Finnish shareholders, because they could have a standstill in Finland. These companies convey Estonian workers to Finland.


Free movement of labour in EU have made easy for work force to move to other country. As a side effect, underground economy in construction industry has bloomed. In Helsinki the situation is getting out of portion, but the same phenomenon is spreading to whole country.



Inadequate supervision

The share of underground economy of Finnish GDP has increased remarkably from nineties. According to latest reports of Tax Administration it is 5,5 – 7,5 percent, 10 – 14 billion euros. Finnish government has determined to decrease underground economy one of the key issue in their program. There is going to be more strict supervision within the construction business. All workers, Finnish and foreign, are going to need individual tax numbers and ID cards with picture when they work in construction sites. That way authority is getting statistic information in the future.


In this story there are no winners. Estonian construction workers bargain their manpower at the expense of their social security. The state is losing remarkable amounts of tax incomes. The states supervision is inadequate compared to the extent of the phenomenon.



Statistics Finland: http://www.stat.fi > Yksityisen sektorin kuukausipalkkaisten säännöllisen työajan ansio oli 3 255 euroa lokakuussa 2010

Statistics Estonia: http://www.stat.ee > In the 4th quarter the average monthly gross wages (salaries) and the real wages grew

The Finnish Construction Trade Union: http://www.rakennusliitto.fi > Tilannekatsaus koko maa

EUR-lex: Regulation (EEC) No 1612/68 of the Council of 15 October 1968 on freedom of movement for workers within the Community

Finnish Tax Administration: http://www.vero.fi > Harmaan talouden tilannekuva 4/2011

Jukka-Pekka Simpanen, The President of The Finnish Construction Trade Union


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