Summary of employment related news in Sweden as of January 2021

January 19, 2021 Corona/Covid-19

Short-time work, a new pandemic law and pending changes to the Employment Protection Act. Here is the latest employment related news in Sweden.

In March 2020, the Swedish government implemented short-time work in order to support businesses affected by COVID. Short-time work means that employers can reduce their employees’ working hours by up to 80% and receive financial support from the government to compensate for a significant part of the costs for retaining the employees while the employees keep most of their salaries. The short-time work legislation was prepared quickly. It is thus conceived as unclear and challenging to interpret and apply in practice for both authorities and companies. The system will be in place at least until June 2021.

The government has also implemented several other employment related regulations during the COVID pandemic. For example, currently the employer cannot, as usual, require sick employees to present a doctor’s certificate from day eight of their sickness in order to receive sick pay. In addition, a new pandemic law was adopted on 8 January 2021. It is intended to make it possible to more effectively prevent the spread of COVID by allowing the government to close businesses such as stores, gyms and shopping malls.

Apart from the COVID news, the most significant recent employment related event is the pending modernisation of the Swedish Employment Protection Act (the “EPA”). Recently some of the major Swedish social partners – employer organisations and trade unions – presented an agreement that is expected to result in a revision of parts of the EPA this year. The modernised EPA is expected to provide, amongst other things, greater predictability in relation to termination of employments for personal reasons, permit an extended number of exceptions from the order of selection for redundancy and simplify the transition from fixed-term employment to employment until further notice. Through the agreement, the social partners retained the so-called Swedish model, where the partners decide on regulation through collective bargaining agreements without government intervention.

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