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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

Anonymous - 8 June 2021 at 21:15 CEST

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/

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INTERVIEW: 'A lot of people think Brexit is done, but it's not for Brits in Europe'

In the early days of 2021, after the United Kingdom had left the EU and completed the final stage of Brexit, many British citizens returned to their home countries in Europe only to face a grilling at the border.

Though the Withdrawal Agreement (WA) technically guaranteed their right to live and work in the countries they’d settled in before Brexit, there was widespread confusion about these fundamental rights and many were treated like new arrivals.

Over time, the chaos at the airports subsided as border officials and airlines were given clearer guidance on the treatment of Brits. But three years later, a number of Brits who live on the continent still face problems when it comes to proving their post-Brexit rights.

This was the reason campaign group British in Europe decided to set up their new EU-funded ICE project. Starting this year in March, it aims to build valuable connections between UK citizens abroad and mentor the next generation of civil rights advocates around the continent. The acronym stands for ‘Inform, Empower, Connect’ and the project’s organisers describe it as “the first project of its kind”.

“It’s a completely innovative project – especially the fact that it’s across so many countries,” Jane Golding, chair of British in Europe and one of the project’s founders, told The Local.

Bringing together groups from 11 EU member states, the project aims to train up volunteers to understand both the Withdrawal Agreement and EU Charter of Fundamental Rights, as well as learning skills like advocacy and communication, using real-life civil rights cases that are referred to British in Europe.

“The ultimate goal is to amplify the messages across the wider group,” said Golding. “You start with the volunteers, they go back to their groups, then the people that we train, they go back and train people. Then they pass on that knowledge to the wider groups, on their Facebook accounts and through social media, and hopefully it all snowballs, not just in their countries but across the EU.”

‘Far-reaching repercussions’

So many years after Brexit, it’s hard to believe that there’s still a need for a project like ICE that empowers Brits to protect their rights. Indeed, the future of groups like British in Europe and regional groups like British in Germany and British in Spain felt uncertain just a year or two ago.

But Golding says there are still serious issues cropping up for Brits in several countries around Europe – they just have a different quality to the problems that arose at the start.

“In some ways it’s needed even more because as we predicted right at the beginning, at the first stage of implementation, you’ve got the more routine cases,” she explained.

“What we’re seeing now is not as many cases, but when the cases come up, they’re complex. They can have such far-reaching repercussions on people’s lives. And of course, memories start to fade. A lot of people think Brexit is already done, but it’s not.”

Volunteers in British in Europe ICE project

The volunteers of the British in Europe ICE project pose for a photo at the kick-off meeting in Brussels on May 21st, 2024. Photo courtesy of Jane Golding

Though the rights set out in the Withdrawal Agreement apply across the continent, different countries have taken different approaches to implementing them.

That means that while in Germany, for example, UK citizens simply had to declare that they lived in the country, people in neighbouring Denmark had to apply for their rights.

This led to a notorious situation in Denmark in which as many as 2,000 Brits were threatened with deportation after not applying in time or completing the right application process. According to Golding, this had a lot to do with the fact that people who arrived in 2020 weren’t given the same information as other UK migrants who arrived before.

In Sweden, meanwhile, the situation is still difficult for many Brits who lived there prior to Brexit.

“There have been issues with an anomalously high numbers of refusals compared to other countries, and they seem to be taking a very strict approach on late applications,” Golding explained.

Portugal has been another difficult case. Although the country opted for a declaratory system where Brits could simply exchange old residence documents for a new ID card after Brexit, reports suggest that the authorities have taken years to issue these cards, leaving many of the some 34,000 Brits in the country in limbo.

“While people are still waiting to have their status confirmed and have their card in their hand, it’s difficult to access a whole range of services, like health services, or applying for jobs or dealing with the authorities, or even going to the bank,” Golding said. “All of these problems just affect people’s lives.”

A French border guard checks a passport at the border

A French border guard checks a passport at the border. Photo by DENIS CHARLET / AFP

There are also concerns about the EU’s new exit and entry system (EES), due to come into force in October, which is based on biometric documentation.

“We still do not have clear data on how many people in declaratory countries like Germany, where it wasn’t compulsory to apply for the card, don’t actually have a card,” Golding said. “How is that going to play out if it’s a document-based digitalised system?”

A lack of support

In the immediate aftermath of Brexit, funding from the UK’s Foreign, Commonwealth and Development Office (FCDO) was still available to support NGOs in Europe helping Brits with their migration and civil rights issues. But that temporary funding soon expired, leaving groups like British in Europe largely on their own.

“The whole point is people’s lives change at very different paces,” Golding said. “And now this project is really going to start to pick up some of those cases and report on those issues, which is really crucial and exciting for the precedent that it sets, and it’s very clearly necessary still, because people don’t just sort their lives in the 18 months that the FCDO chose to supply that funding.”

This feeling of being left alone and increasingly isolated from the UK is one that many Brits in Europe have felt in the aftermath of Brexit. But the upcoming UK election on July 4th could be a game-changer.

This time, following a change in the law, Brits who have lived abroad for more than 15 years will be able to vote for the first time.

Polling station in the UK

A polling station in the UK. Photo by Elliott Stallion on Unsplash

When it comes to the election, the message from British in Europe is clear: “Make your voice count now, make your vote count, make sure you use it,” Golding said.

With the June 18th registration deadline fast approaching, BiE is advising UK citizens abroad to apply for a proxy vote as soon as possible, rather than relying on a postal vote from abroad. Since the 15-year rule was abolished on January 16th, more than 100,000 British citizens have registered to vote, according to official statistics. It is unclear how many were registered before the change in the law.

With an estimated 5.5 million Brits currently living abroad – 1.3 million of whom are in the EU – this could have a significant impact on the electoral landscape, Golding says. But most significantly, the change is creating a feeling of connection and belonging that wasn’t there before.

Nurturing this sense of belonging is one of the main goals of ICE.

With these bridges being built, British in Europe hopes to create a network of support that spans across borders.

“Now we’ve met. We’re going to meet,” said Golding. “We know we’re going to meet again in Berlin in October and then we’ll meet again in the new year in 2025 as well. It means a huge amount because even British in Europe, our steering team, we’ve only met physically three times.”

This opens up the possibility of people sharing their knowledge from country to country, Golding explained.

“There is crossover and the reassurance of having that EU wide view and knowing that you’re not alone and knowing that in this country, we managed to get this solution,” she said. “And then you can go back and say to the authorities in your country, well, in that country they did that – all of that helps. It’s really good.”

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