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29.05.2023 09:00

Logistics pay scale system updated

PAM and the Finnish Commerce Federation have been jointly working on an update of the pay system for logistics, clerical employees and ICT employees in the commerce sector. Amongst other things, minimum wages in the collective agreement for logistics employees will in future be staggered according to job complexity. Long development work went into this…

Traditional warehouses have seen a rapid transformation. In addition to the automation of logistics, the Covid pandemic accelerated change in the commerce sector. E-commerce increased considerably, and logistics became even more important with purchases having to be delivered right to customers’ homes.

The flow of goods through a modern logistics centre to stores and customers is rapid and cost-efficient. Logistics operations are digital and automated. Employees no longer necessarily sit in a forklift truck, and work more with digital devices and robots.

“So far the collective agreement has only recognised one pay group even though job complexity can vary a lot. Logistics sites increasingly need people who are able to operate digital devices and monitor processes”, says the Finnish Commerce Federation’s chief labour market specialist, Antti Huotilainen.

Bringing the collective agreement up to date

In the midst of this transformation, the one and only wage scale in the old collective agreement has for some time been out of touch with the reality of new job descriptions in the sector.

“It isn’t all that fair if the collective agreement stipulates the same minimum wage for basic logistics centre roles and logistics process management, for example”, says PAM’s collective bargaining specialist Jyrki Sinkkonen.

The new pay system developed jointly by PAM and the Finnish Commerce Federation addresses this need.

Pay scales at four different levels

From the beginning of next year, there will be four complexity categories in logistics roles.

  • Professional role
  • Demanding professional role
  • Specialist professional role
  • Expert role

Minimum wages apply to the first three levels and the fourth level, the most demanding, is agreement-based.

The new pay system is based on an appraisal of the work role, not the employee.

The pay of logistics employees, therefore, is no longer determined by the job title, rather it is based on the skills required in the role. Job complexity factors include, for example, the use of discretion, how independent the work is and the nature of interaction required in the role.

Analogously to logistics roles, the pay systems for clerical employees (formerly office employees) and  ICT employees in the commerce sector are also being updated. In these, the changes mostly consist of updated complexity categories.

Visibility for training and career pathways

Antti Huotilainen, who has studied pay in the commerce sector through company interviews, says that employers have already been building their own pay systems that recognise various elements of job complexity. This has also been vital in being able to get skilled workers committed to their company.

Now the changed nature of work is being made part of the collective agreement and is reflected in the new pay system in the agreement. Huotilainen thinks a particularly good feature is that the new pay system in the collective agreement highlights various training and career pathways in the sector.

The new pay system is a pull factor

Jyrki Sinkkonen at PAM  figures that the updated pay system in the collective agreement will make the sector more attractive. The updated collective agreement is a way of marketing the sector to young people planning their future.

“Young people could be motivated to take a vocational qualification in logistics, since the collective agreement lists several pay scales and you can plan your career from basic roles up to expert and management positions.”

Having spent years representing the interests of warehouse employees, Sinkkonen remembers a time when turnover was high among warehouse workers. Now employers want to hold on to employees since it can take many months to get a new employee trained up.

Employers and shop stewards evaluate job complexity together

The reform will progress as follows: this year employers will review job descriptions together with shop stewards (or other staff representative/ representatives).

A description of every role at the workplace will be drawn up so that the role can be placed in a job complexity category.

Jyrki Sinkkonen is pleased that shop stewards and employers will put the reform into practice in partnership.

“Close interaction between staff and employers at workplaces can only be a good thing and in everybody’s interests. There should be more joint efforts to develop working life. This new pay system will keep the dialogue going since work is changing rapidly and requires constant vigilance to keep job descriptions up to date.”

Sales assistants’ pay system to be updated next

The wage criteria for sales assistants are next up for an update during the current agreement period. The analysis and planning work has already started in the associations’ joint working group.

Antti Huotilainen from the Finnish Commerce Federation says it’s a similar exercise as for logistics. The  analysis will look particularly at those elements of complexity in sales assistants’ work roles that are not yet picked up by the collective agreement. Does a role for example require product knowledge, interaction skills, or knowledge or application of a process.

“It’s fair to reward skills, job complexity and performance. The collective agreement provides a basis and a minimum level. Companies will have to identify what elements of complexity are used in a work role and build their system accordingly. This will give employers more discretion and place additional demands on management.”

PAM’s collective bargaining specialist Sirpa Leppäkangas says that both commerce firms and staff representatives will also be involved in developing the pay system for sales assistants. The logistics update sets an example and shows the way.

“Once we get the logistics systems in place, we will learn more about the operability and procedures of a complexity classification, where roles are placed in complexity categories. This knowledge is important because in the world of sales and sales assistants, more than in commerce logistics, there are different companies and within these very different job profiles.”

Leppäkangas says that the development work together with the employers’ federation is about daily contacts and continuous understanding of each other’s objectives and needs.

“Our focus is firmly in the future. Where the world is heading and how to respond to that at workplaces. How can commerce sector workers do well and businesses prosper.”