Hire in Sweden

Employer of record in Sweden

If a lack of speed or local expertise are among your top concerns when expanding to or employing workers in Sweden, an employer of record may be the best option for achieving your global growth objectives.

An employer of record, sometimes known as an international PEO, enables you to quickly hire and onboard workers in Sweden ―often in as little as two weeks―without having to take on the cost and risk of establishing a local entity.

Learn about the hiring, employment, payroll and benefits requirements for workers in Sweden and how our employer of record service, EOR, and local HR experts can help you manage your international employment needs.

Hiring in Sweden

In Sweden, the employer in principle has the freedom to hire at will, although this independence is restricted to some extent by legislation on nondiscrimination, employment protection and public employment.

The employer must, within one week after the employee has commenced employment, inform the employee in writing of conditions of material importance to the employment relationship.

Swedish labor and employment law is concerned with contracts of employment, but not with contracts for the performance of work that are classified as a contract for services. Swedish law does not define the concepts of employee or employer, and it has fallen to the courts to establish definitions of these terms. The distinction between contract of employment and contract for services is crucial not only for the applicability of labor legislation but also for legislation such as social security and taxation.

Under the Employment Protection Act, contracts of employment are of indefinite duration.

Employment contracts in Sweden

As you look to hire employees in Sweden, here are some standard regulations you’ll need to know to create a compliant contract, as well as how an employer of record and PEO can provide support for your unique HR needs.

Working hours

Although working hours are often determined by collective agreements, the typical day lasts eight hours with a maximum of 40 hours per week. Employees are entitled to at least 11 hours of rest between workdays and at least 36 hours of rest each week. Employees are entitled to a break after five hours.

Compensation

As you consider the appropriate salary to offer new employees, keep in mind:

• There is no minimum wage in Sweden.
• Work done outside normally worked days or hours is considered overtime and is limited to 48 hours over four weeks or 50 hours per calendar month with a maximum of 200 hours per year. Collective bargaining agreements generally set the overtime premium at 50% or 100% of the ordinary hourly wage.
• Wages are usually paid monthly but are determined by collective agreements.
• Collective agreements may regulate the legal salary and overtime range.

As your employer of record in Sweden, we can provide you with resources and insights about employee compensation, so you are better equipped to make a competitive employment offer.

Bonuses

Sweden’s labor laws do not address bonuses.

Probationary period

Probationary periods are allowed as long as they do not last more than six months. Unless otherwise stipulated, probationary employment can be terminated at any time.

Termination and severance

Swedish law considers termination a last resort and requires employers to help employees correct unsatisfactory performance and/or improve the working relationship first.

When the employer gives notice of termination, whether it is due to redundancy or personal reasons, the required notice period varies according to the employee’s continuous length of employment, beginning at one month for less than two years of employment and increasing to a maximum six months for at least 10 years of employment.

Before giving notice of termination, the employer must under certain circumstances notify the employee and the local trade union of which the employee is a member.

Employees must give one month’s notice to terminate their employment.

There is no statutory requirement for employers terminating employees’ contracts to make any severance or redundancy payments, but such payments may be stipulated in the individual contract.

As your employer of record in Sweden, we can work with you to quickly handle the unforeseen event of an employee termination, providing legal guidance and a personalized process that ensures you stay out of labor court.

Employee benefits and paid leave in Sweden

When negotiating terms of an employment contract with a candidate in Sweden, here are some of the statutory benefits and paid leave requirements to keep in mind, as well as how an employer of record can support your company’s benefits strategy.

Maternity leave

Parents are jointly entitled to 480 days of parental leave when a child is born or adopted, and they may take it until their child is 18 months old. Multiple births mean additional days of leave. The leave entitlement can be shared equally between both parents, except for 90 days.

The mother can receive paid leave from 60 days before the due date until the child turns 12 years old, but only 96 days can be used after the child turns four. Parental leave pay is generally 80% of regular wages for the first 420 days if the employee has worked at least 240 days in Sweden.

Parents are also entitled to reduce their working hours by up to 25% until the child turns eight.

Vacation

Employees are entitled to 25 days of annual vacation. While on vacation, an employee is entitled to holiday pay if it has been accrued during the qualifying year, which runs from April 1 through March 31. The right to receive holiday pay must be earned during a qualifying year before being paid out the following year.

If the first year of employment begins after August 31, the employee is entitled to five days of vacation during the first holiday year.

Employees can waive any annual leave that is not combined with holiday pay.

Collective agreements often stipulate that the holiday year and qualifying year must coincide, so vacation is earned the same year it is taken.

Employers can decide when employees take vacation if at least four continuous weeks are provided during June, July, or August unless otherwise accounted for in a collective agreement.

Vacation pay equals 12% of all wages earned during the qualifying year.

Employees accrue vacation pay during the following periods of absence during the qualifying year:

• Illness not exceeding 180 days
• Parental leave not exceeding 120 days
• Education leave not exceeding 180 days
• Military training not exceeding 60 days

An employee with more than 20 days of accrued leave may carry forward one or more days for up to five years after the qualifying year. When employment ends, employees are entitled to payment in lieu of vacation days not taken. Unless the employee agrees, an employer may not schedule vacation leave during a notice period of termination.

Holidays

Employees are entitled to the following paid public holidays:

• New Year’s Day
• Epiphany
• Good Friday
• Easter and Easter Monday
• Walpurgis Night
• Labor Day
• Ascension
• National Day
• Whit Sunday
• Midsummer Day
• All Saints’ Day
• Christmas Eve
• Christmas
• Boxing Day

Public holidays that occur on a weekend are not moved. Overtime pay is not required for working on a public holiday.

Sick leave

Employers must pay sickness benefits equal to 80% of an employee’s salary for the first two weeks of an employee’s absence. If the absence continues beyond two weeks, sickness benefits are paid by the Social Insurance Agency. Employees cannot be dismissed on the grounds of illness.

Health coverage

The legal retirement age is 65.

Employers must pay a social insurance contribution for employee pension and health insurance at 31.42% of an employee’s gross salary. Employers are required to make these payments for any employee or contractor who earns 1,000 krona or more per year. For employees under 26, employers pay a reduced social security contribution rate.

There is no ceiling on employer contributions to the social security system. Employee contributions of 7% of wages or salaries, however, are capped at an amount adjusted annually.

Generally, collective agreements provide that employers take out additional insurance for their employees covering benefits like supplementary pensions and group insurance.

Additional benefits

In addition to healthcare benefits, employees in Sweden are entitled to pension, which is funded by government tax revenues, as well as workers compensation, which is covered through mandated employer insurance.

Employer social costs will cover a large portion of employee benefits in Sweden, but we can consult with you about supplemental coverage options, such as additional pension contributions or life insurance if needed.

Updated: February 12, 2024

Employee onboarding with an employer of record in Sweden

We write and validate all local employment contracts, streamlining the onboarding process for you and your Swedish employees—all you have to do is provide relevant information and review and approve the employment agreement. As your employer of record in Sweden, we will:

• Schedule a welcome call to discuss HR and employment information for Sweden, as well as answer any questions 
• Prepare a customized employment contract in English and Swedish (or other local language)
• Share the employment contract and benefits information with the new employee for signature and review
• Gather tax and banking information from the employee to set up payroll 
• Provide a local point of contact to the employee to answer any questions regarding their employment, local HR or payroll

The entire onboarding process for the employee is often completed in as little as two weeks.

Partner with Safeguard Global as your Sweden employer of record and PEO

With over a decade of service, we are the longest-serving employer of record and PEO provider in the international market. Organizations around the world rely on EOR, our employer of record solution, to expand and hire in over 170+ countries around the world, quickly and compliantly. 

We’ve seen just about every global employment circumstance imaginable—and with our extensive knowledge of local law and culture, we know what it takes to get employment right in Sweden. We provide written contracts in the local language, salaries in the local currency and HR support in your employees’ time zone.

Additionally, as a global payroll provider we support payroll administration—including payments, filings and other calculations— all around the world and can accommodate the payroll outsourcing needs of any size organization. 

Whether you’re looking to hire as part of a strategic expansion or to meet specific talent needs, our global solutions advisors can walk you through your international hiring options so you can make the right choice for your organization. Contact us today.

Disclaimer

The information provided on or through this website is for informational purposes only and does not constitute legal advice. Safeguard Global expressly disclaims any liability with respect to warranty or representation concerning the information contained herein, including the lost essence, interpretation, accuracy and/or completeness of the information in transit and language translation.