In Sweden, there are no statutory definitions of white and blue-collar workers. Instead, these groups are defined by the applicable trade unions of which the workers are members and, therefore, different collective bargaining agreements (CBA) apply to these two groups. In some labour market areas, the CBA regulations are uniform and a categorisation of these two groups of workers is not necessary.

General regulations regarding employment protection are found in the EPA. Certain terms for employees in the public sector in Sweden are regulated through the Public Employment Act. However, the same rules essentially apply to private and public employees, and the Public Employment Act only contains a few specific rules for public employees.

The general rule is that an employment agreement is for an indefinite period, unless agreed otherwise. The EPA allows for a special fixed-term employment when the employer is in need of fixed-term employees. A fixed-term employment agreement may also be concluded for a temporary substitute employment and for seasonal employment. An employee who, during the past five years, has been employed either for a special fixed-term employment or as a substitute for an aggregate of more than 12 months, will have their employment converted into indefinite-term employment. A special fixed-term employment may also be converted into an indefinite-term employment if the employee has been employed in different consecutive fixed-term employments. A special fixed-term employment or a temporary substitute employment will not convert into an indefinite-term employment if the employee has reached the age of 67, or, if the employee was employed after 1 January 2020, the age of 68.

Note that CBAs may contain regulations deviating from the statutory rules governing fixed-term employment.

In Sweden, an employment agreement does not have to take any specific form in order to be valid. However, Sweden has implemented the Directive 2019/1152 on Transparent and Predictable Working Conditions in the European Union. An employer must provide certain information in writing to the employee concerning the principal terms of the employment within one month of the commencement of the employment. Failure to do so can result in an obligation to pay damages to the employee concerned.

The requisite information includes, inter alia, the name and address of the employer and the employee, the commencement date, the place of work, duties and title, whether employment is fixed or for an indefinite term, the length of the probationary period, periods of notice, payment and other employment benefits, the length of paid annual leave, the length of the normal working day or working week, and information on the applicable CBAs.

The maximum normal working hours are 40 hours per week. In addition to this, the Working Hours Act sets forth rules concerning overtime work as well as daily and weekly rest for employees.

Deviations from certain regulations in the Working Hours Act can be made by CBA, but not in individual employment agreements.

For part-time employees, the equivalent to overtime is called additional time, which comprises the working hours in excess of the employee’s regular working hours and on-call time. When there is a special need to increase the number of hours worked, an additional maximum of 200 hours may be worked per employee over a calendar year (general additional time). When there are special grounds, additional time in excess of general additional time may be worked up to a maximum of 150 hours per employee over a calendar year. Together, extra additional time and general additional time may not exceed 48 hours per employee over a period of four weeks, or 50 hours over a calendar month.

Overtime comprises working hours in excess of regular working hours and on-call hours. Where additional working hours are required, overtime hours may not exceed 48 hours over a period of four weeks or 50 hours over a calendar month, subject to a maximum of 200 hours per calendar year.

Statutory law does not contain regulations regarding overtime pay, which is normally provided for in CBAs. In general, employees may choose to receive overtime pay in terms of money or compensatory leave. If no CBA exists, the employee is not entitled to overtime pay unless agreed upon individually. If a CBA exists and provides a right to overtime pay, it may contain provisions that make it possible for the employee to waive the right to overtime pay and instead receive compensation in the form of compensatory leave. However, such waiver usually only applies to employees who have flexible working hours, or if special reasons apply.

There are no provisions regarding minimum wage requirements in Swedish law, but such provisions are often found in CBAs.

In Sweden, it is common for employers and employees to agree that part of the full salary will be paid as variable salary. The different types of variable salary vary and can be paid out, inter alia, as commission (eg, a certain percentage of the contractual sum for provided services) or bonus (eg, variable salary paid out in accordance with specific and determined targets with financial parameters of the performance of the employing company and/or personal performance of the employee). The payment of variable salary is not regulated in statute and is rather a matter of negotiation between the parties to the employment agreement. It is most common for the terms for payment of variable salary to be set out in the employment agreement, or for the variable salary targets and the payment of variable salary to be decided annually at the employer’s discretion. It should be noted that variable salary generally qualifies for the payment of holiday pay in Sweden.

In Sweden, a 13th-month payment is not normally applied, but some employers do choose to award their employees with an annual bonus, paid at the company’s discretion, if the company has performed well during the year. Such a bonus is paid as a gratuity and normally does not qualify for the payment of holiday pay or occupational pension contributions.

There is no general government intervention on compensation and salary increases in Sweden, but such matters are often regulated in CBAs. It should be noted that compensation in connection with holiday, parental and sick leave is statutorily regulated.

Holiday and Holiday Pay

Holiday entitlement is regulated by the Annual Leave Act, which distinguishes between holiday days and holiday salary, and between a "holiday year" (1 April to 31 March) and a "qualifying year" (the 12-month period prior to the holiday year). The normal and minimum vacation entitlement is 25 days per year. An employee earns his or her entitlement to vacation salary during the qualifying year and is entitled to use his or her paid vacation during the vacation year. CBAs or employment agreements generally contain rules entitling employees to a longer period of annual leave – up to 30 paid days – if the employee is not entitled to overtime pay. This is normally the case for white-collar employees.

Employees are entitled to take a continuous four-week holiday during the period from June to August, unless there are circumstances justifying other arrangements. Employees who have been given a period of notice of termination of less than six months cannot be required to take their holiday entitlement during the notice period, unless they agree to do so. Under certain conditions, employees are entitled to exchange annual leave that has already been scheduled for sick leave or parental leave, for example. It is possible for employees to carry over their entitlement to paid holiday days to the next holiday year (but not unpaid holiday days), but only if the employee has earned more than 20 days of paid holiday, and only for those days that exceed 20 days.

Deviations from certain regulations in the Annual Leave Act can be made by CBA.

Holiday pay is usually paid out in connection with the employee’s use of their accrued holiday. According to the Swedish Annual Leave Act, holiday pay may be calculated in two ways: according to the same salary rule or the percentage rule. The same salary rule applies to employees whose remuneration is calculated on a monthly or weekly basis, while the percentage rule applies to employees whose remuneration is not calculated on a weekly or monthly basis or has a high variable element. If the variable elements of the salary amount to at least 10% of the total salary during the year, the percentage rule shall be used.

According to the same salary rule, the employee is paid their regular salary plus a holiday supplement of 0.43% of their monthly salary per day. For variable parts of the salary, the employee is paid 12% of the variable salary if he or she is entitled to 25 days of holiday. According to the percentage rule, the holiday pay for employees is 12% of the total salary during the accruing year when the employee is entitled to 25 holiday days.

If the employment ends before the employee has taken paid annual leave to which he or she is entitled, the employer must pay the employee in lieu of the unused holiday pay entitlement.

Required Leave

An employee may go on parental leave until their child is 18 months old. Thereafter, the employee is entitled to leave for as long as he or she receives compensation from the state. Compensation is paid by the state for a total of 480 days per child. The compensation may be paid until the child reaches the age of 12 years, but only 96 days may remain when the child reaches the age of four years.

In addition to parental leave, the mother is entitled to parental allowance during the 60 days prior to the expected birth of the child. The father of the child may also be on paternity leave for ten days in connection with the birth of the child.

The entitlement to parental days is divided equally between the parents, but the parents have the right to transfer their entitlements to each other, with the exception of 90 days; these 90 days will be forfeited if they are not used. As a result, one parent may use a maximum of 390 days, during which the allowance is capped at 80% of the employee’s salary up to a certain salary level. If a CBA is in force in the workplace, the employee may be entitled to compensation from the employer in addition to the compensation from the state. A parent is also entitled to parental leave and temporary parental benefit if their child is sick.

An employee is entitled to mandatory sick pay payable by the employer, provided that the employment is expected to continue for more than one month or that the employee has been working for more than 14 consecutive days. During days 1-14 of the sick leave, the employee is entitled to 80% of the estimated salary and employment benefits the employee receives during a normal week. From the sick pay, a deduction of 20% is made (karensavdrag). If the employee falls ill again within five days, the previous sick leave period will continue and no further deductions will be made. From day 15 in the sickness period, the employee may be entitled to compensation payable by the state. The entitlement to such compensation is based on strict rules and is decided by the Swedish Social Insurance Agency. There is no obligation for the employer to provide any supplementary sick pay, unless such is provided for in an applicable CBA or individual agreement.

Limitations on Confidentiality

An employee’s obligation not to reveal confidential information about the employer’s business follows from the employee’s duty of loyalty during the employment. However, according to the Trade Secrets Act, a disclosure of a company’s trade secret by an individual for the purpose of making public or revealing to a public authority or other authorised body a matter that may reasonably be suspected of constituting a criminal offence punishable by imprisonment or that is deemed to constitute another serious irregularity in the company’s business activities is not considered an unlawful disclosure. A comparable principle is found in the Whistle-Blowing Act. As a main principle, there are no limitations on confidentiality agreements in terms of time, but such an agreement may be considered unreasonable and unenforceable by a court if it is too burdensome for the employee.

Non-disparagement clauses are not that common in Sweden, but the duty of loyalty includes a duty not to be disloyal towards the employer by way of disparagement. However, an employee has a right to put forward critique towards the employer when it is justified, as mentioned above.

Employee Liability

The main principle is that the employer is responsible for all damage caused by the employee in the employment. For damage that an employee causes through fault or negligence in his or her employment, the employee is responsible only to the extent that there are exceptional circumstances with regard to the nature of the act, the employee’s position, the interest of the injured party and other circumstances, according to the Tort Liability Act.

The main rule is that post-employment restrictive covenants are valid only if they are reasonable, taking many different factors into account, such as whether employees receive some kind of compensation for the restriction, whether the restriction is limited to certain companies, whether the restriction is limited geographically, etc. An overall assessment of all relevant factors has to be made in each individual case.

According to CBAs and market practice, employers are obliged to pay approximately 60% of the monthly income from the employer as compensation for inconvenience caused by the non-competition clause. However, a general assessment of the reasonableness of a non-competition clause must be made in each individual case, which means that other types of compensation may also be accepted as long as they are linked to the non-competition clause.

Post-termination covenants are valid under certain circumstances. Covenants regarding confidentiality are normally used for all kinds of employees. However, non-compete covenants should normally only be used for employees whose position in the company makes such restrictions necessary. In principle, the period of a non-compete covenant should not exceed nine months, or, under certain conditions, a maximum of 18 months.

Non-compete covenants are normally combined with a contractual penalty, which must be reasonable in relation to the employee’s salary. Such a penalty is usually set at between three and six months’ salary for each breach. Furthermore, restrictive covenants may also be combined with a continuing penalty, and the employer can also be entitled to further damages if the damage caused by the employee exceeds the amount of the contractual penalty.

For employees, there is no limitation in time for non-solicitation covenants, but they generally follow the same time limitations set forth in non-compete covenants. A clause regarding the non-solicitation of employees does not usually need to be combined with any compensation in order to be considered reasonable (unlike non-competition clauses) but should be limited, eg, to colleagues that the employee has worked with. A general assessment of the reasonableness of a non-solicitation clause must be made in each individual case.

With reference to customers, there is no limitation in time for non-solicitation covenants, but they generally follow the same time limitations set forth in non-compete covenants. Furthermore, in the same way as non-competition clauses, a clause regarding the non-solicitation of customers needs to be combined with compensation in order to be considered reasonable. However, a general assessment of the reasonableness of a non-solicitation clause must be made in each individual case.

The General Data Protection Regulation (GDPR) is applicable in Sweden and provides protection for individuals against violation of their personal integrity by the processing of personal data. Accordingly, there are restrictions on employers’ use of data regarding employees, former employees and applicants. There are certain basic requirements for any form of processing of personal data that is fully or partly computerised, according to the GDPR.

Personal data may only be processed if it is lawful to do so. The personal data must be collected for specific, explicitly stated and justified purposes. The collected personal data needs to be relevant and necessary for the purpose stipulated and may not be stored for longer than necessary with reference to the specified purposes. It must also be accurate and processed in a manner that ensures appropriate security of the personal data. The GDPR also stipulates situations in which personal data may be processed if the individual has not given his or her consent to the processing. For example, personal data may be processed in order to satisfy a purpose that concerns a legitimate interest of the employer, provided that this interest outweighs the interest of the registered person in protection against violation of their personal integrity.

Certain types of personal data are considered special categories of personal data; for example, information about employees’ or applicants’ race or ethnic origin, genetic data, political opinions, religious or philosophical beliefs, membership of a trade union, or personal data concerning health or sexual preference. Special categories of personal data may only be processed in special circumstances.

The GDPR sets forth certain rights for the registered individuals, such as the right to information concerning the processing of their personal data, the right to access, and the right to rectification, erasure and restriction of processing.

Citizens of countries outside the EU must have a work permit to work in Sweden. In order for a person to obtain such a permit, the employer must have prepared an offer of employment and advertised the job in Sweden and the EU for ten days (this applies to new recruitment). The person applying for a work permit must also be able to show a signed written employment agreement. The terms of employment must be equal to or better than those provided under a Swedish CBA or that are customary for the occupation or sector. In addition to this, the employee shall be entitled to health insurance, life insurance, industrial injuries insurance and occupational pension insurance. The employee must also earn enough from the employment to be able to support himself or herself, the gross salary should be at least SEK13,000 per month and the relevant trade union must have been given the opportunity to express an opinion on the terms of employment.

The Posting of Workers Act applies to posted workers in Sweden.

EU and EEA citizens do not need a visa and have the right to work in Sweden without work permits or residence permits. People who have a residence permit in an EU country but are not EU citizens can apply to obtain the status of long-term resident in that country, thereby enjoying certain rights similar to those of EU citizens.

The increase in mobile work imposes new demands on the work environment. The employer's responsibility for the work environment is regulated by the Work Environment Act, which requires employers to take all necessary measures to prevent workers from being exposed to ill health or accidents. The employer must therefore systematically plan, direct and monitor activities in a manner that ensures that the work environment meets the prescribed requirements for a good work environment. The employer's responsibility for the work environment applies even when employees work remotely. However, the employer and employees must co-operate to create a good work environment. In the case of mobile work, when the employer's insight into the work environment is limited, employees must consequently alert the employer to any deficiencies in the working environment. The employer’s responsibilities include the physical work environment, such as equipment, as well as the social work environment, such as working hours. Furthermore, the rules regarding working hours in the Working Hours Act must be complied with even when an employee is working remotely. Employees are therefore entitled to a minimum rest period of 11 consecutive hours in any 24-hour period (“daily rest”), as well as a rest period of 36 consecutive hours per 7-day period (“weekly rest”).

GDPR applies to mobile work and the protection of personal data must be upheld in accordance with the GDPR, regardless of where the work is carried out.

An employee working remotely is entitled to the same social security as an employee performing work at a fixed location. This means that the same rights to sick pay, parental leave and holiday pay apply.

The term sabbatical is not used in Swedish labour law. However, employees may be legally entitled to leave of absence depending on the purpose of the leave. The leave of absence entails unpaid leave for a period of time. An employee is not entitled to general leave, but the employer may choose to grant it. Under certain conditions, an employee may be entitled to necessary leave from his or her employment to receive education. Pursuant to the Employee Leave (Education) Act, this applies if an employee has been an employee of the employer during the most recent six months or for a total of not less than twelve months during the last two years. An employee may also be entitled to leave from work for a maximum of six months in order to pursue a business activity by themselves or through a legal entity. However, the employee's activities must not compete with the employer's business. Employees may have a legal right to leave of absence for family-related reasons as well, for instance because of a family member’s accident or to care for a seriously ill relative.

Gig work or platform work is becoming increasingly common. Gig work involves individuals working through platforms, such as an application, and receiving orders for tasks. This type of work is not separately regulated in Swedish law. An important issue that arises in connection with gig work is whether the individuals working are to be regarded as "employees" in the context of the law, or as independent agents. To be covered by the protection of Swedish labour law, the person carrying out the work must be considered an employee. There is no legal definition of the term employee; instead, the court must decide in each individual case whether a gig worker is to be considered an employee. Note, however, that gig work may be regulated in the future, for instance by the proposed EU directive on improving working conditions in platform work.

Almost one out of ten employers in Sweden are members of an employers’ organisation and approximately 70% of employees in Sweden are members of a trade union. There are approximately 110 different trade unions and employers’ organisations on the Swedish labour market. The parties have agreed on more than 650 CBAs, so trade unions are very prevalent on the Swedish labour market. The “Swedish model” of industrial relations is characterised by a high degree of organisation, even though trade union density is currently falling.

The Co-Determination Act contains the general provisions governing the relationship between employers and the trade unions in areas such as association, information, negotiations, industrial actions and labour stability obligations.

According to the Co-Determination Act, an employer has certain consultation and information obligations towards the trade unions. For example, prior to any decision to reorganise the business or terminate employment contracts, the employer must call for and conduct consultations with the trade unions under the applicable CBAs (at both local and national level, if applicable). Even if the employer is not bound by a CBA, they are obliged to consult the trade union of which the employee concerned is a member regarding the planned reorganisation and potential redundancies.

The Act also contains certain interpretation regulations, to the benefit of the trade unions. Generally, these rules give the trade union the right to interpret the CBA until the matter has been finally decided by court and are therefore important in the case of disputes.

The local trade unions usually elect one or more representatives to represent the employees at a workplace, under the provisions of the Trade Union Representatives Act. Employees who are trade union representatives may not be prevented from carrying out union work during working hours, may not be discriminated against due to their union activities and are entitled to a reasonable leave of absence to carry out their union activities. The local trade union representative shall manage questions relating to labour at the specific workplace – issues of salary, work environment, reorganisations, etc, are normally covered. A trade union representative enjoys extended protection in a redundancy situation.

Furthermore, the Board Representation Act entitles employees of private companies that are bound by CBAs and have at least 25 employees to appoint two ordinary and two deputy employee representatives to the board of directors. Employees of companies that have at least 1,000 employees and are engaged in different industries are entitled to appoint three ordinary and three deputy employee representatives to the board of directors.

Moreover, Sweden has implemented the European Works Council Directive (Directive 2009/38/EC) and the Directive establishing a general framework for informing and consulting employees in the European Community (Directive 2002/14/EC).

Lastly, in a workplace where at least five employees are regularly employed, one or more safety representatives should be appointed, in accordance with the Working Environment Act. If the employer is bound by a CBA, the safety representatives are appointed by the trade union; otherwise, they are appointed by the employees.

The Swedish system is based on the principle that law and CBAs together shall provide a comprehensive framework.

Through membership in an employers’ organisation, the employer is bound by the CBAs applicable to that organisation. The employer is also obliged to apply the terms and conditions of the CBA to employees that are not members of a trade union. It is also possible for an employer to sign a CBA directly with one or more trade unions.

Once a collective bargaining agreement has been entered into and is in effect, an obligation to refrain from industrial action comes into effect and prohibits strikes or lock-outs. Breaking the peace obligation will incur liability for damages on the breaching party.

A dismissal must be based on objective reasons, which are not defined by statute or case law but can relate either to redundancy or to the employee personally. Redundancy covers all reasons attributable to the employer, such as reorganisations, shortage of work or the economic situation of the employer, while personal grounds are all grounds attributable to the employee, such as the employee’s conduct or performance.

An overall assessment of all the factors involved must be made when determining whether there are objective reasons for dismissal. A dismissal with notice will never be considered as being based on objective reasons if there were other alternatives available to the employer, such as relocating the employee elsewhere within the business. Thus, an employer must investigate whether there are any vacant positions within their business that the employee can be offered before a notice of termination is given.

Dismissal Procedure

The procedure for dismissing employees varies to some extent, depending on whether the dismissal is due to redundancy or personal reasons. The procedural requirements to follow are laid down in the EPA. Prior to terminating an employment agreement due to redundancy, the employer may be obliged to conduct consultations under the Co-Determination Act if the employer is bound by a CBA or if the employee is a member of a trade union.

The basic principle to be applied when the labour force has to be made redundant is that the employee with the longest aggregate period of employment with the company should be entitled to stay the longest: the employer must select those to be laid off on a “last in, first out” basis. A condition for continued employment is that the employee has sufficient qualifications for one of the available positions that may be offered.

Prior to terminating an employment agreement on personal grounds, the employer must notify the employee concerned in writing and the trade union, if the employee is a trade union member, two weeks in advance. If an employer wants summarily to dismiss an employee without notice, the information must be given one week before the actual dismissal. The employee or the trade union may request consultations with the employer concerning the dismissal, within one week of receiving the information.

The employer must observe certain formal rules set out in the EPA when serving a notice of termination to an employee. Notices shall always be made in writing and must state the procedure to be followed by the employee if they wish to claim that the notice of termination is invalid or to claim damages as a consequence of the termination. The notice shall also state whether or not the employee enjoys rights of priority for re-employment. Several statutes contain limitation periods for bringing employment claims, including the Co-Determination Act, the Annual Leave Act and the EPA. Furthermore, the Limitations Act stipulates limitation periods for salary and pension claims.

Dismissal of Multiple Employees

In Sweden, there is no principal difference between a termination due to redundancy involving one employee or such a termination involving 150 employees. Hence, the Co-Determination Act does not recognise the term “collective redundancies”. In contrast to many other European countries where the obligation to consult collectively is triggered only if there are several redundancies, the provisions on obligations to consult according to the Co-Determination Act are applicable even if the redundancy concerns only one employee (please see the outline for termination due to redundancy described above).

If more than five employees are subject to a redundancy situation and their employments are being terminated, the employer is obliged to notify the Swedish Employment Agency a certain period in advance, depending on how many employees are being terminated. This also applies if the total number of notices of termination is expected to be 20 or more during a 90-day period. Failure to observe this notification obligation may result in a liability to pay a special fee to the state.

Statutory notice periods from the employer’s side vary between one and six months, depending on the length of the employment term, as described below:

• one month if the length of the employment term is less than two years;
• two months if the length of the employment term is at least two years but less than four years;
• three months if the length of the employment term is at least four years but less than six years;
• four months if the length of the employment term is at least six years but less than eight years;
• five months if the length of the employment term is at least eight years but less than ten years; and
• six months if the length of the employment term is at least ten years.

The length of the notice period may be extended by virtue of CBAs or individual contracts. During the notice period, the employee is obliged to perform work for the employer and is entitled to salary and all other employment benefits. It is possible for an employer to release the employee from the duty to perform work during the notice period.

The minimum notice period in the case of a termination from the employee’s side is one month but can be extended by a CBA or an individual employment contract.

There are no statutory provisions regarding severance pay. However, an employee may be entitled to severance pay in accordance with an employment agreement or an exit agreement.

Please see 7.1 Grounds for Termination regarding union consultations and union representation where the employee is a member of a trade union.

Summary dismissal may take place where the employee has grossly neglected his or her obligations to the employer.

The summary dismissal may not be based exclusively on circumstances of which the employer was aware either longer than two months prior to the notice of summary dismissal or, should such a notice not be issued, longer than two months prior to the summary dismissal.

Prior to summarily dismissing an employee, the employer must notify said employee in writing and the trade union, if the employee is a trade union member, one week in advance. Within one week of receiving the information, the employee or trade union may request consultations with the employer concerning the dismissal.

The summary dismissal shall be in writing and shall be given to the employee personally. In the notification of summary dismissal, the employer shall state the provisions with which the employee must comply if he or she wishes to bring legal action alleging that the summary dismissal is invalid or to seek damages on the grounds of the summary dismissal.

Upon the employee's request, the employer shall state the circumstances invoked as reasons for the summary dismissal, in writing if the employee so requests.

Summary dismissal shall be deemed effected when the employee receives the notification of summary dismissal.

Summary dismissal means that the employee is not entitled to any notice period or other termination benefits, according to the employment agreement.

The employer and employee are free to enter into a final settlement in a termination agreement. Hence, the employment may be terminated disregarding the strict rules of the EPA. Consequently, an employee may waive his or her contractual rights. As a rule, an employee cannot waive rights laid down in mandatory law that are not yet accrued, but an employee is free to waive rights that are already accrued. Normally, the employee is financially compensated in order to enter into an exit agreement with the employer that includes a full and final release. There are no specific procedures or formalities to consider when entering into a termination agreement with an employee.

There are no specific requirements for termination agreements in Swedish law. However, all agreements can be deemed unreasonable and amended or declared invalid by a court, according to general contractual law.

Dismissals that are considered discriminatory according to the Discrimination Act are prohibited. Furthermore, several other regulations protect employees from unfair dismissals. For instance, an employee may not be dismissed for reasons related to parental leave or leave of absence for educational purposes, or part-time employment. Trade union representatives also have specific protection against dismissal and against discrimination based on their union activities.

A trade union representative may not be given less favourable working conditions or employment terms and conditions as a result of his or her activities. Upon termination of his or her duties, the employee shall be ensured the same or a comparable position in respect of working conditions and employment terms and conditions as if he or she had no trade union-related duties. Furthermore, in conjunction with a termination due to redundancy and in conjunction with lay-offs, the union representative shall be given priority for continued work, provided it is of specific importance for trade union activities at the workplace.

In the case of wrongful termination of employment, the termination could be challenged by the employee as not having an objective reason and could be declared invalid by the court. If the termination is declared invalid, the employer may be obliged to pay salary and benefits during the court proceeding, as well as punitive damages, compensation for economic losses and the costs of the litigation.

Anti-discrimination legislation consists of the Discrimination Act, which prohibits both direct and indirect discrimination as well as harassment in working life based on sex, ethnicity, religion or other belief, disability, sexual orientation, transgender identity or expression, and age.

Furthermore, employers may not discriminate against part-time or fixed-term employees, nor may they treat an applicant or an employee unfairly for reasons related to parental leave under Swedish law. Trade union representatives are also protected from discrimination based on their union activities.

Where a person who believes that they have been subject to discrimination or reprisals proves facts that give cause to believe that they have been subject to discrimination or reprisals, the defendant must prove that there has been no such discrimination or reprisals.

A party who violates the prohibitions against discrimination or reprisals, or who fails to fulfil its obligations to investigate and take measures against harassment or sexual harassment under the Discrimination Act, shall pay compensation for discrimination for any humiliation and personal indignity resulting from the violation. When compensation is decided, the specific purpose of combating such violations of the Act shall be taken into consideration. The compensation shall be paid to the person offended by the violation.

An employer who discriminates against an employee, applicant, etc, or breaches the provisions regarding prohibition against reprisals shall also pay compensation for the loss incurred. However, this does not apply to loss that is incurred in conjunction with a decision pertaining to employment or promotion, nor to loss incurred as a result of discrimination in the form of insufficient access.

Furthermore, if someone is discriminated against by a provision in an individual contract or in a CBA in a manner that is prohibited under the Discrimination Act, the provision shall be modified or declared invalid if the discriminated person requests it.

Digital court hearings have become more frequent. However, no new legislation has been implemented that specifically regulates digital court proceedings. It is common for a party to a court hearing or a witness to participate digitally. Pursuant to the Swedish Code of Judicial Procedure, the court may decide that a participant in a hearing should be present via video if it is appropriate and there are specific reasons for doing so. Digital participation in court hearings is in general in compliance with the right to a fair trial in Article 6 of the European Convention on Human Rights, which is incorporated into Swedish law. Digital trade union consultations have become more common as well. There is no regulation on the possibility of digital trade union consultations; instead, it is up to the parties involved to decide how a consultation should proceed.

The Labour Court is the first and only instance for employment disputes concerning a CBA or in accordance with the Co-Determination Act, or if a CBA applies between the parties. Other employment disputes are resolved in the district courts, with the Labour Court as the first and final instance of appeal.

Negotiations and consultations between employers and organisations can be held at both a local and a central level.

Regarding judicial disputes, since a trade union organisation has the right to bring an action before the court – regarding a dispute of CBA, for example – this constitutes a form of class action. According to the Class Action Act, an organisational class action can be commenced by a non-profit association that, according to its statutes, will protect the interest of its employees. Class action claims are uncommon in Sweden.

Further, the right to resort to industrial action is a constitutional right laid down in the Instrument of Government, which applies only to trade unions, employers or employers’ organisations. Restrictions of this right are set forth in the Co-Determination Act, which stipulates that an employer and an employee that are bound by a CBA may not initiate or participate in industrial action if an organisation is party to that agreement and has not duly sanctioned the action.

Normally, the employee is represented by a union representative in court if they are a trade union member. Hence, the employee bears no costs for his or her representation in court, as the costs are borne by the trade union. Employers are also sometimes represented by their employers’ organisation, but more often they are represented by an in-house legal representative or by a law firm.

The employer and the employee may agree in an employment agreement that any future disputes shall be settled by arbitration. Such a clause may be deemed unreasonably burdensome for the employee and set aside by the courts, particularly if the employee does not occupy a managerial or comparable position.

Dispute resolution regulations may also be specified in CBAs.

For employment disputes, the main principle regarding liability for litigation costs is found in the Swedish Code of Judicial Procedure, namely that the losing party shall be ordered to bear the prevailing party’s litigation costs. However, according to the Labour Disputes Act, each party may be ordered to bear its own litigation costs if the losing party had reasonable grounds to bring the action. However, this rule is normally only applied in collective bargaining disputes.