Read news from:
Austria
SHARE
COPY LINK
For members

POLITICS

What you need to know about the ‘biggest reform of the Swedish labour market in modern times’

The Swedish government is putting forward a proposal to change the country's labour laws, following long-running negotiations that sparked a significant political crisis.

Published: 8 June 2021 16:03 CEST
What you need to know about the 'biggest reform of the Swedish labour market in modern times'
One of the main changes related to Sweden's 'last in, first out' rule regarding lay-offs. Photo: Melker Dahlstrand/imagebank.sweden.se

The law under review is the Employment Protection Act, called Lagen om anställningsskydd in Swedish and usually referred to as LAS.

One of the key principles is “last in, first out” when it comes to redundancies. If a company needs to restructure or cut jobs, the most recently hired person should generally be first to go. There are exceptions, such as if that employee performs a key role that can’t easily be done by someone else, but the proposals would make this even more flexible.

Under the new proposals, employers would be allowed to exempt up to three employees from the “last in, first out rule”. That’s more than under current regulations, which allow small companies with no more than ten staff are allowed to exempt up to two employees.

“Having employees with the right skills is becoming ever more important,” Labour Market Minister Eva Nordmark told a press conference on Tuesday morning, presenting the proposals which she called “the biggest reform of the Swedish labour market in modern times”.

The centre-left government agreed to “modernise the Employment Protection Act” as part of its 2019 deal (the January Agreement) with the Centre and Liberal Parties, where these centre-right parties were given considerable influence in policies in order for the Social Democrats and Green Party to be able to govern.

So the government ordered a review of the law, presenting its first results in June 2020.

Under those proposals, the changes suggested were even more significant than those put forward this week: up to five employees would be exempted from the “last in, first out” rule, and it would not be possible for any dismissal from a small company (up to 15 employees) to be declared invalid.

The ruling Social Democrats criticised these proposals, as did many trade unions, so talks began between politicians, trade unions and employers’ organisations. But these collapsed, which meant that under the January Agreement, the responsibility fell to the government to put forward a new set of proposals.

That’s what it is now doing.

Another big change in the new proposals is that in the case of disputes over unfair dismissals, the employer would not always have to pay the salary of the affected employee until the issue is resolved, as is the case today (if a court rules that the dismissal was unfair, the employee would then receive their salary for the time the dispute was ongoing).

It would become more difficult in general for employers to dismiss employees for so-called personal reasons. And there would be greater opportunities for employers to get funds for adjustment and skills support for staff, even when they are not covered by collective bargaining agreements.

These proposals are currently set to become law on June 30th, 2022, and companies and organisations will be able to start applying the new rules from October 1st, 2022. However, they will need to be passed by parliament first.

There is broad consensus in favour of the latest proposals among employers’ organisations and trade unions, Swedish newswire TT reports, though smaller businesses and some unions represented by blue-collar trade union confederation LO have criticised the government’s suggestions as too inflexible for smaller companies.

Member comments

  1. Was part of the intention of LAS to help keep employers from firing their most highly paid employees (because getting rid of them would offer the greatest savings in labor cost)?

    Also, do these changes to LAS actually help this problem? –

    – “I didn’t speak any Swedish when I moved here so I got the first English-speaking job I could find, two months after landing here, in customer support for a tech startup in Stockholm. They laid me off two weeks before my six months were up, with no warning or cause.

    – “I thought that was obviously a one-off thing — shady company, shady people, bad luck, what have you. Two weeks later I got another English-speaking job, in Uppsala. Another tech startup but much longer established. The job was in one of my actual fields (marketing). A month after I started, another girl started as well, same department. It was a great job, an awesome place with lovely people all around. I loved it,” she said.

    – “Two weeks before my six months were up, they laid me off, citing costs and the pandemic. A month later, they also laid off the girl that started after me, also two weeks before her six months were up. *One month after we were both gone, they hired someone else.*

    All of the quotes are from this Local article:
    https://www.thelocal.se/20201023/either-in-or-out-why-swedens-strict-labour-laws-hurt-foreigners/

Log in here to leave a comment.
Become a Member to leave a comment.
For members

WORK PERMITS

Sweden’s Migration Agency rejects role in work permit salary threshold exemption plan

Sweden's Migration Agency has rejected a call for it to be responsible for drawing up a list of in-demand skills and professions exempted from the coming median-salary requirement for a work permit.

Published: 25 June 2024 12:02 CEST
Sweden's Migration Agency rejects role in work permit salary threshold exemption plan

In the conclusions to a government inquiry into setting the median salary threshold, judge Ann-Jeanette Eriksson proposed that the Migration Agency be made responsible for drawing up annual national and regional lists of professions which should be exempted from the threshold.

The list of proposed exemptions could then, she recommended, either be passed to the government for a final decision, or else apply immediately. 

In its response to consultation, the Migration Agency said that it did not believe that it was the right agency to draw up the list. 

“The Migration Agency considers that the task of preparing these proposals should be given to the Swedish Public Employment Service which is the expert agency on labour market issues,” the agency said. 

“As the expert agency, the Swedish Public Employment Service has much broader competence when it comes to judging the demand for labour.”

The employment service could then consult the Migration Agency and other relevant agencies before passing the list to the government, it recommended. 

READ ALSO:

The Swedish Public Employment Service did not echo the Migration Agency’s call in its own response. 

It did, however, recommend an alternative system proposed by Eriksson, under which the Migration Agency, rather than the government, would have the final say on which jobs should be exempted. 

“The alternative proposal would mean a simpler process and shorter handling time”, the service said. 

The Migration Agency, however, said it did not support this alternative proposal, without giving any reasons for this.

It did call for a consideration over “whether it might be necessary to consult with other authorities before the proposals are made to the government”.

The agency also called for more specific language on what “considerations around migration law” it should apply when deciding on which professions to exempt. 

In some of its comments on the detail or proposals, the Migration Agency highlighted that the law should specify that work permit applicants need to be offered a salary that meets or exceeds Sweden’s median salary “at the time of application”, and also called for more specifics on how to define a “monthly salary”.

  • Don’t miss any Swedish work permit news from The Local by downloading our app (available on Apple and Android) and then selecting Work Permits in your Notification options via the User button

Eriksson also recommended that Migration Agency be tasked with deciding which industries should be entirely excluded from the work permit system because they have historically had problems with the exploitation of labour migrants and abuse of the work permit system.  

“The possibility of excluding certain groups of jobs is an important tool in the work against exploitation in the workplace,” the agency said of this proposal.

But it said that to carry out this task properly, it would need more information on what criteria should be applied when making such exclusions as well as increased powers to cooperate and share information with other agencies involved in combatting exploitation and abuse in the workplace. 

“For this work to be even more effective, more tools are needed that enable more thorough controls. This is both about developing regulations that provide the Migration Agency with wider powers to carry out checks that facilitate cooperation and information exchange between relevant authorities and organisations,” it said. 

When it comes to the impact of the proposals on its own internal workings, the agency said it agreed broadly with the Eriksson’s judgement that they would not increase the workload at the agency.

The extra work required to carry out its new tasks would, it said, be largely offset by the lower work load following from the proposed abolition of the spårbyte, or “track change” system which allows rejected asylum seekers to stay in the country and apply for work permits. 

It did warn, however, that the changes could lead to even longer processing times for work permit applications. 

“The Migration Agency would like to highlight that the proposed changes to the law, and in particular the salary threshold and the regional and national exemptions from this threshold might affect handling times for work permit cases,” it wrote. 

“The regulatory framework around labour migration is already complex today and involves several decision points. Judging whether an application concerns a job for which there is a national or regional shortage will require a new decision point which will require education and preparation.” 

To reduce the extra demand on resources, the agency called on the government to make the regulation “as precise as possible”, leaving as little room as possible for different interpretations, which would then allow the agency to speed up processing and even digitalise some decisions. 

If the plans to raise the work permit salary threshold from 80 percent of the median salary to 100 percent go through, the idea is that they would come into effect in June next year (although work permit holders renewing their permits would get a one-year grace period).

But the proposal has received a slew of criticism from Swedish business organisations, which argue that it would make it harder to fill essential roles and attract international talent.

SHOW COMMENTS