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The Swedish rules around hiring and firing that could spark a political crisis

What are the Swedish employment law changes that are being argued about – and why could they spark a government crisis? The Local explains.

Published: 3 June 2020 11:35 CEST
Updated: 2 October 2020 16:02 CEST
The Swedish rules around hiring and firing that could spark a political crisis
Currently, the most recently hired employees are at biggest risk of redundancy. Photo: Isabell Höjman/TT

What's the Employment Protection Act?

This is the law that is under review. It outlines the rules for hiring and firing within Swedish businesses, and also contains regulations for employment contracts. In Swedish, it is called Lagen om anställningsskydd, and is usually referred to simply as LAS. 

One of the key principles is 'last in, first out' when it comes to redundancies. In other words, if a company needs to restructure or cut jobs, they should work from the principle that the most recently hired person is the first to go. There are exceptions, such as if that employee performs a key role that can't easily be done by someone else.

The government ordered a review into the law, the results of which were shared in June. They've been welcomed by centre-right parties and businesses, but received criticism from trade unions and the Social Democratic Prime Minister as well as other left-of-centre parties.

Why is it being reviewed?

It was part of the so-called January Agreement, a deal drawn up between four parties to ensure that Sweden's government could rule and put an end to post-election deadlock.

In order to get the passive backing of their former centre-right rivals the Centre and Liberal parties, the centre-left Social Democrat-Green government agreed to a review of the employment law.

In the agreement, the government pledged to “modernise the Employment Protection Act to adapt to the present-day labour market while maintaining a basic balance between the actors in the labour market”.

“The law should give businesses flexibility and protect individuals against arbitrary dismissal,” the January Agreement said. 

Specifically, it asked for proposals giving clear exceptions from the 'last in, first out' rule, to reduce the costs of dismissal for small businesses, lay out the responsibility of employers for skills development, and create a balance in job protection for people on different kinds of contracts. 


Photo: Lieselotte van der Meijs/imagebank.sweden.se

What did the review say?

The review suggested that all companies, regardless of size, should be able to exempt up to five employees from the 'last in, first out' principle during any rounds of layoffs. Currently, companies with more than ten employees may exempt up to two, and smaller companies must follow the principle.

And age would no longer be a factor. In cases where two employees have been at the company an equal length of time and one must be laid off, currently the youngest employee has to leave. Under the new proposals, the employer would be able to make their own decision.

It also suggested making the rules stricter when it comes to giving an employee a new position rather than lay them off. Instead of being allowed to take new qualifications, as is allowed under the current rules, the person would need to be able to take on their new responsibilities straight away.

Another big proposed change was that in small companies, those with fewer than 15 employees, it would not be possible for a dismissal to be declared invalid. That means that in the case of any disagreement, the company would not have to pay the salary of the affected employee until the issue was resolved, as is the case today. For larger companies, they would only have to pay out the salary in the event of a court decision declaring the dismissal invalid, and not during the time of the dispute.

WORKING IN SWEDEN:

What are the arguments for and against?

The 'last in, first out rule' may lead to less labour market mobility. For example, it could dissuade employees from changing jobs because they would then risk being the last person in. And it means that the highest performing individuals aren't necessarily those who keep their jobs in times of difficulty. Företagarna, an organisation representing business-owners, welcomed the proposals, saying current rules hinder company growth and give flexibility. 

But there's a risk that giving managers the say in who is affected by layoffs could lead to discrimination, or would go against the government directive to protect individuals from arbitrary dismissal.

Sweden's trade unions are very strong, and generally say they prefer to negotiate employment terms themselves. The Swedish Trade Union Confederation has said that the new proposals make it more difficult for them to carry out negotiations.

Prime Minister Stefan Löfven of the Social Democrats was critical of the proposals. 

“The balance between [employers, employees and unions] has not been upheld,” he told Aftonbladet at the time.

What happens now?

The January Agreement stated that if the different parties involved in the labour market were satisfied with the proposals, they would come into force from January 2021. But if no such agreement was reached, it stated that instead the government would put forward proposals on the basis of the other parties' suggestions.

Negotiations between The Swedish Trade Union Confederation and the Confederation of Swedish Enterprise broke down in the early hours of October 1st, so the matter is currently in the hands of the politicians.

This could spark a government crisis, with the Left Party vowing to put forward a vote of no confidence in parliament if the ruling Social Democrats press ahead with the matter. But if the Social Democrats do not do so, they risk angering their Centre and Liberal partners.

At the time of writing, all three latter parties have said that they would be open to allowing the unions and businesses more time to work out an acceptable compromise, so it is currently unclear what will happen.

Have you got a question about working in Sweden, or want to share your own experience? Perhaps you were a victim of the 'last in, first out' principle, have experienced discrimination at work, or have set up your own business? The Local is here to help you navigate life in Sweden and raise your voice, so please get in touch.

Member comments

  1. It’s ok to update articles but please clearly mark what’s the updated part. I read this article when it came out in June and now I couldn’t understand which one is the new part or what is the new information that the update means to deliver.

  2. Hi Renato, that’s great feedback, thank you! We’ll keep that in mind for the future. In this case, most of the updates are in the “what happens now” section, so we now know that negotiations between the labour market groups have broken down (whereas in June they hadn’t yet got under way).

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For members

READER INSIGHTS

How to find a job in Sweden: Five tips from those who’ve been there, done that

The Swedish job market poses unique challenges for newcomers. The Local's readers share their best tips for cracking the career code.

Published: 10 April 2024 11:32 CEST
Updated: 13 April 2024 15:50 CEST
How to find a job in Sweden: Five tips from those who've been there, done that

Network, network, network!

A statistic that often gets tossed around is that seven out of ten jobs in Sweden are obtained through personal connections, and there’s no doubt that a good network is crucial to your job hunt, making the labour market extra challenging for newcomers to the country.

In fact, networking was the main tip mentioned by The Local’s readers.

“The job market is quite hot in Sweden, and talent is in short supply. People hiring do not have a lot of time to find the right talent, and tips from friends, colleagues and former colleagues are the way to first, find out organisations are hiring, and secondly, get your CV on the short list,” said Kyle, a Canadian reader who works in innovation management in Gothenburg.

“If you are going for a major employer like Volvo, network gets you in the door, as HR does not have much to do with hiring… the hiring managers do all of it and have no time, due to the insane number of consensus meetings. If you are looking for smaller organisations, they have even less time to find people, and networking is their primary way to find talent,” he added.

NETWORKING IN SWEDEN:

Some of the networking tips readers mentioned were going to job fairs, getting an internship to help you establish connections in your preferred field, joining clubs (this could be anything from your local gardening association to meetups for coders, but focus on clubs that may be popular among people working in your chosen field), and drawing on your organic network of friends, neighbours and others.

Don’t neglect the groundwork

The saying “dress for the job you want, not the job you have” is getting worn out (and people may look at you funny if you turn up to interviews in a Batman suit), but there’s truth to the notion of making sure you know what you want – and preparing for it.

In other words, don’t wait for a job ad to appear before you start to customise your CV and figure out what skill set you need. Create your CV now so that you’re ready to tweak it to your dream job – you could even have a general look at job ads in your field to see what requirements are needed. And don’t forget to spruce up your LinkedIn profile so that it fits with your career goals.

“I believe that several factors contribute to successfully landing a desirable job in Sweden. It’s essential to prepare to meet the requirements beyond just having a university degree. Many individuals realise these requirements only after completing their studies when they start searching for a job, which can be too late,” said Adnan Aslam from Pakistan, who works as a food inspector.

“I recommend identifying the job advertisements for positions you aspire to hold in the future and then preparing for those requirements during your studies. For me, acquiring a basic level of proficiency in the Swedish language and obtaining a Swedish driving licence were crucial. I pursued these goals during my studies and was able to secure a desirable job before graduating,” he added.

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Felipe Cabral even has a GPT assistant trained on his own CVs and old cover letters, and said the set-up only takes ten minutes if you already have your documents. “With that in place, you can give instructions like: Read this job description and create a tailored version of my CV and letter for it. (…) Remember to always review and ask it not to create data aside from your documents.”

Be flexible and ready to adapt

Moving to a new place inevitably means having to learn not just the practicalities such as how to write a CV or which websites to use to look for job openings, but also learning how to navigate a new culture with all its unspoken expectations.

Swedish workplaces are generally less hierarchical than many other countries, but that doesn’t mean you can say whatever you want whenever you want without anyone raising an eyebrow. Swedes are usually direct, but be careful of being too abrasive or boastful: raising your voice, even during a spirited argument, or banging your own drum to show off your skills may not go down well.

“Talk, deliberate, complain like a Swede and you’ll come across like you know what the job entails, so your trustworthiness increases,” said an Indian data analyst who preferred to remain anonymous.

“Office politics are just as strong in Sweden as anywhere else. The flat hierarchy is deceiving as social hierarchy is enforced quite a bit in that lack of formal hierarchy. Take your time in learning these dynamics wherever you work before revealing your talent and capabilities. Expect those internal politics to happen, and they won’t hurt so much when they do,” said Kyle, the Canadian reader in Gothenburg.

This article about Swedish office politics may be useful.

Stay true to yourself

Adapting to your surroundings is one thing. Completely changing who you are is another.

For one thing, your happiness is as important as your career progression, and for another, your foreignness need not be an impediment: it’s also a skill that sets you apart from the rest. It means you have unique experience, and also, in the right setting, provides an opportunity to sometimes violate those social rules we mentioned above, because people assume you will, anyway.

“Trust is key. Build trust in your network, work with integrity. It’s OK to violate jantelagen if you are maintaining integrity. Sometimes your outsider and more honest/open opinion will burn bridges, especially those that may feel threatened by talent. But it will build trust with other colleagues who see it as brave and more trustworthy to work with,” said Kyle from Canada.

Hunker down for the long haul

We don’t want to scare you, because there are plenty of examples of people who quickly find their dream job in Sweden and settle into their new workplace, enjoying perks such as long summer holidays, generous parental leave and the famous work-life balance.

But if you do find it tougher than you expected: know that you’re not alone.

Several readers who responded to the survey said they were still trying to find a job in Sweden.

“I found jobs all over Europe but not here. They say they have a lack of experienced senior engineers but the don’t seem to be doing much to solve this,” said a Brazilian in Gothenburg.

A reader from Bangladesh said she was “at a loss” as to how to make a career change from her current AI role in Stockholm, despite many years of experience as an IT project manager.

“Over the past 18 months, I’ve submitted over 600 applications to various organisations. Unfortunately, despite being overqualified for some positions, I’ve faced rejections at every turn, from both large and small companies. The job market here, especially for foreign-born women, feels overwhelmingly challenging,” she said, adding that the struggle had impacted her mental health.

The Local has on several occasions reported on foreign residents’ struggle to get a foot on the Swedish job ladder, with many facing hurdles such as employers’ unfamiliarity with international degrees, discrimination, or a lack of network that can provide paths into a company.

So during the job hunt, don’t forget to care for yourself. Share your concerns with fellow job-seekers, ask for help and join networking groups – this is good not just for creating new contacts, but also in terms of your social well-being and meeting people who are in a similar situation.

And finally, as one British reader in Stockholm advised, keep looking: “Be open-minded with the opportunities that present themselves. It isn’t an easy market to enter and doesn’t feel inclusive.” But he added, “don’t give up”.

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