A review of the eligibility criteria was launched after it was discovered that the Sun Ray association, which had been granted pay subsidies and the Helsinki benefit for hiring employees, had been collaborating with an entity on the EU sanctions list.
Employment Services commissioned an external operator to carry out an investigation into the activities of a hundred organisations receiving pay subsidies. The procedures for granting subsidies were also examined. In the next phase, the investigation was extended to cover all organisations that had received subsidies after 1 January 2025. This phase covered roughly one thousand employers.
Employment Services updated its eligibility criteria and operational processes regarding pay subsidies and the Helsinki benefit as of 1 May 2026.
The focus in granting subsidies is on employment
Prior to the clarification of the procedures for granting subsidies carried out at the beginning of May, the guiding principle was that the aim of the subsidies was, first and foremost, to support the employment of the person to be employed, and that the subsidies should also be as easy as possible for small employers to apply for.
However, this has meant that the nature of the operations of the employers receiving the subsidies has not been sufficiently examined when making decisions. Subsidies have also been granted to organisations whose activities do not comply with the City’s ethical principles or regulations.
“We identified a need to improve our tools and clarify our guidelines. The new procedures introduced at the beginning of May are significantly improving the situation,” says Managing Director of Helsinki Employment Services Annukka Sorjonen.
Key findings of the external investigation
The investigation of a hundred employers, commissioned by the City and carried out by an external operator, revealed seven organisations receiving subsidies whose operations entail significant risks, five organisations whose operations entail medium-level risks, and two organisations whose operations entail a low risk level. Some of the observations were made after the subsidies had been granted. Furthermore, in the media monitoring carried out in connection with the investigation of a thousand employers, commissioned by the City and carried out by an external operator, 11 organisations were found to have been the subject of negative headlines.
In observations involving a significant level of criticality, the employer and its key personnel have been publicly associated with suspicions of issues such as radicalism, exploitation, human trafficking or financial crimes. The organisation or its key personnel have been the subject of a police investigation, a suspicion of a criminal offence or a criminal conviction.
In observations classified as involving a medium level of criticality, the employer, its key personnel or other employees have been publicly associated with suspicions of issues such as internal misconduct, unclear or ambiguous activities, or questionable links to Russia. The organisation or its key personnel have publicly denied the allegations made or taken appropriate measures, such as dismissing employees suspected of misconduct or reporting said misconduct to the authorities.
According to the external investigation, in observations classified as involving a low level of criticality, no allegations or suspicions have been levelled at the employer or its key personnel themselves, but the organisation or its key personnel have been in the public eye in connection with projects, recruitment processes or other matters that may involve unethical, unclear or questionable activities.
On the basis of the risk assessment, Employment Services has contacted the employers identified in the investigations and requested further details and a sanction declaration in order to determine further measures. Any penalties will be imposed in the early autumn, once further investigations have been completed.
All employers to undergo a risk assessment
Employment Services has already clarified its criteria for granting pay subsidies and the Helsinki benefit as of 1 May 2026, and has asked the Ministry of Economic Affairs and Employment to adjust its own procedures.
Today, employers are required to provide a more detailed account of the nature of their activities than before. Employers always undergo a risk assessment.
The subsidy is not granted if the previously used eligibility criteria are not met; comprehensive information on the employer’s operations is not available; the employer has been in operation for less than a year; the person to be hired with the subsidy would be the only employee in the organisation; the employer does not give an assurance that they will comply with the extended conditions; the nature of the employer’s activities or the duties of the person to be hired with the subsidy is such that there are no grounds for granting the subsidy (e.g. the employer’s financial difficulties or any criminal offences); or the employer is engaged in religious or party-political activities.
The plan is for the same conditions to also be applied to Employment Services’ other financial support forms and services, insofar as this falls within the City’s discretion.
The request for additional information complicates the process somewhat from the point of view of applicants. The aim is to implement the changes in such a way that small employers will continue to be able to apply for the subsidies in future.