Finnish President Sauli Niinisto has accepted the resignation of his prime minister, Antti Rinne. Niinisto has asked the current administration to remain as a caretaker government until a new one is in place.
The Finnish Center Party, part of the Nordic country's five-party ruling coalition, had lost confidence in Rinne, who had come under pressure over the government's handling of a two-week postal strike.
Rinne, who took office in June, met Niinisto at the presidential palace to hand in his resignation.
The announcement prompted the formal resignation of the Cabinet, made up of Rinne's Social Democrats, the Center Party, the Greens, the Left Alliance and the Swedish People's Party of Finland.
Niinisto accepted the resignation request but asked Rinne's Cabinet "to continue as a caretaker government a new government is in place."
Speaking to reporters on Monday, Rinne said losing the backing of Finland's Center Party led to his decision to resign.
"All of the governing parties have confidence in me, except the Center Party. When I was told they no longer have confidence in me, I made the decision to resign," Rinne said.
He added that the coalition is committed to keeping the administration. "If (my) being prime minister jeopardizes the government program, it is better that I steer clear of it," Rinne said.
Niinisto thanked Rinne for "the short, but many moments of good cooperation."
Postal service controversy: Rinne has faced heavy criticism in recent weeks over how he and a fellow party member dealt with a two-week strike in November involving workers of Finland's state-owned postal service. The strike also spread to the national airline, Finnair, and other industries before the dispute was settled last week.
Forced out: Earlier Tuesday, Finland's Center Party said it had lost confidence in Rinne. The move was directed at the prime minister, not at the Social Democrats. "Losing confidence" is not a formal procedure in Finland, like a vote of no-confidence one sees in other parliamentary-governed nations.
EU ramifications: The political crisis in Finland comes at an awkward time for the European Union. Finland, which holds the bloc's rotating presidency until the end of the year, has a central role in establishing a new EU budget.
What happens next: The Center Party is unlikely to push for new elections and has expressed its desire to remain in the coalition government. Instead, the Finnish parliament is expected to choose a new prime minister next week. Sanna Marin, a member of Rinne's Social Democrats and Finland's transport and communications minister, is seen as a frontrunner to replace the prime minister.