- Overview: Sweden
- Global HR Compliance
- Global PEO and payroll
- Work permit for hiring expats via PEO
- Expand without a company set up
- Contractor vs. employee: which is better?
Global HR Compliance in Sweden
If you hire an international workforce, or plan to hire, then Hiring and Firing Workforce in Sweden Guide below will help you understand the nuances of labor legislation in the country.
When the company is planning to enter a new foreign market of Sweden and has a need to employ a local national there, the first question to answer is how it is going to make local hires.
We have designed a Global Employer of Record service to help you outsource global employment of your foreign workforce to companies like ours.
This solution helps you employ your global sales force in Sweden as well as in other countries of the world, and provide pay and benefits to your employees, as well as administer any business expenses with our help.
Our solution is different from other hiring modes in that it helps you engage your foreign workforce in full compliance with the local labor legislation. This means you are protected from any non-compliance and employee misclassification risks while we bear all employment risks, not you.
So, it looks very much like hiring your in-house sales force in your home country. However, you focus on only on your global business development while we admin your global HR. In addition, you don’t need to open your own entities in the foreign countries and can leverage our infrastructure in Sweden instead. With our service, you can become a global company with reduced costs and minimized time and effort on your end.
Your employed foreign sales force will devote 100% of their time to your company product and may stay with you longer than foreign independent sales reps.
Global Employer of Record solution is 100% compliant solution that guarantees you and your employees fully compliance with local legislation in Sweden .
We are experts in global workforce employment in Sweden, and our goal is to become your single provider. Instead of working with numerous local staffing agencies and legal advisors, Acumen International can solve your global business challenges and save you time, costs, and resources.
Our team of English-speaking professionals frees you from working through language nuances. Acumen International works 24/7 and can assist you whenever you need, regardless of time zones. Our goal is to create tailored labor solutions for you that are managed legally and in full compliance with the local employment laws.
With our knowledge and deep understanding of local nuances, you easily satisfy your need for skilled professionals in your global industry. With our qualified local partners, you can trust that your global workforce satisfies all local tax, social security, and immigration requirements in Sweden.
Hiring and Firing Workforce in Sweden Guide
Sweden is a safe haven for IT companies, manufacturing companies and in fact any enterprise that seek a safe and a rewarding market to invest their money. According to Forbes report, Sweden is placed in the front rank as one of the best places to do business in the world. Sweden has a world-class infrastructure that is favorable to business operations, provides a gateway to substantial number of consumers in more than 27 markets, has a highly skilled workforce and most interestingly, is very receptive to foreign business partners.
To succeed with your plans of doing business in Sweden, it is essential that you acquaint yourself with the ins and outs of its business framework. Here are some of the basics you will need to know about what conducting business in Sweden entails:
# Employment Contracts
Contracts can be concluded orally or in writing. Based on the type of employment, a contract can either by temporary or permanent (indefinite). Whichever is the case, the employer is required to specify the terms of the employment in writing. In effect, contracts are considered to be permanent unless is it explicitly agreed otherwise. A fixed term employment may be of at least one month’s and at most twelve months’ duration. Through a collective bargaining agreement it might be agreed to allow for shorter or longer fixed term employments. According to Teknikavtalet IF Metall any agreement between the employer and employee relating to fixed term employment must be in writing. The most important thing is that the employer should provide in writing the relevant information about the type of employment, employee’s position and responsibilities, expected commencement date, notice periods, benefits/compensation, including the payment periods, and when applicable, the relevant collective agreement. The employer must inform the local employees’ organization of any fixed term employment.
# Minimum statutory employment rights
# Hours of work
The normative working hours per day is 8 hours and 40 hours per day, though employers have been trying out in recent times a 6-hour working days. The Employment Act made provision for some instances where an employee can be allowed to work an average of 40 hours a week up to a maximum of 4 weeks. Working hours are mostly regulated by statute and in collective bargaining agreements.
# Trial period
Swedish Employment Protection Act allows a trial period of up to 6 months. This means that an employer has the right to give his/her employee as least as 1-day and as high as 6 months’ probationary period before he/she is fully employed. Employees during the period of probation are entitled to a pay for the works done. An employer or the employee can terminate the contract during or after the probation period. For the contract to be terminated, the initiator (in most cases, the employer) is required to notify the other party no less than 2 weeks before he/she ends the contract. if it is the employer that wants to end the contract, he will be required to inform the applicable labor union if the employee belongs to any. A probationary contract naturally translates to an indefinite contract if not cancelled after the agreed period.
# Annual leave
All the workers in Sweden have the right to take a time off during any of the national holidays, as well as the de facto holidays. In addition to that, employees are entitled to at least 25 days’ paid vacation annually or a compensation instead. It is a common practice for the employer and the employee or labor union (with the employer having the upper hand in case of disparity) to agree on the actual days of vacation. Employees love and are entitled to have part of their vacation any time between June and August. Employees can accumulate up to 25 days of their annual leave over the period of 5 years with the maximum of 5 days per year. These accumulated days must be used up within the first 5 years of its accumulation. In the event of the contract being terminated before the employee can use up his/her vacation, he will be entitled to a payment instead.
# Parental leave
Sweden has one of the most generous parental leave in the world. No doubt the standard procedures for getting the parental leave benefits can be complicated, but the basic thing you need to be eligible for the entitlement is a residency.
All working parents in Sweden are entitled to 480 days leave at childbirth or child adoption. Either of the parents are also entitled to an additional 10 days after the child is born, while multiple births or adoption usually attracts extra 20 days making it a total of 490 or 500 paid days. Both parents have the right to share this 480 days’ period between themselves, but must ensure that each of them have at least 60 days to him/herself. Employees on parental leave are eligible to receive from the Social Security Department, a parental benefit which is approximately 80 percent of their salary for the first 390 days and up to 180 SEK for the days left.
# Sick leave
A sick employee is required to inform his/her employer about his/her state of health as a prerequisite to claiming the sick leave benefits. During a sick period, the employee is entitled to a paid sick leave, 14 days of which will be payable by the employer in amount of 80% of the employee’s salary and the rest by the Social Insurance Agency. Sick benefits entitlement start to count from the second day of the sick period. However, the employee can be paid by the state from the first day of his/her sick period if the employer fails to pay his/her own part of the benefit.
The number of overtime an employee can work is usually regulated by the collective agreement. According to the Employment Act, an employee can work up to 200 hours of overtime during a calendar year. Overtime is compensated for with a pay (usually between 50% and 100% premium) or time off. It is important to note that Swedish employees do not attach so much importance to working overtime, especially if it is on the account of time mismanagement.
# State minimum salary
There is no state minimum salary in Sweden. The law provides for the workers the rights to form and join independent unions to bargain wages collectively, and it prohibits antiunion discrimination.
# Employment termination
Contract that ends on their due dates do not require a notice period before the employment relations can officially end. If either of the parties wishes to end the contract before agreed date, he/she will be required by law to provide the other party with a notice. Coming from the employer, he will be required, in addition to the notice, to provide in writing the reasons for the termination. The length of the notice of termination can take from one month for employees who have worked for about two years in the company, to six months for those who have worked up to 10 years. The employee on the other have must give his/her employer a notice period of one month before he can end the contract.
Having considered the major setbacks for penetrating or expanding your business activities in Sweden, Acumen International has set up an express global Employer of Record solution that will help to not only set your global expansion plan in train but also to bring it to fruition.