New rules of the Swedish Employment Protection Act - October 2022
The most comprehensive employment law reform in a very long time is expected to enter into force on 30 June 2022, to be applied for the first time on 1 October 2022. The new reform will entail many changes as regards Swedish employment law, but the changes that will probably affect most employers are the following:
Termination of employment due to objective reasons
Termination of employment by the employer will require "objective reasons" instead of "objective grounds", which is the case today. The idea of this change is that it will be more predictable (easier) for the employer to be able to assess whether it has the right to legally terminate an employee’s employment. However, as long as there is no case law from the Swedish Labor Court, we don’t really know what this change will entail in practice. This remains to be seen.
More employees may be exempted from the order of priority
In the event of termination of employment due to redundancy, all employers, regardless of size, will be able to exempt 3 employees from the order of priority. Today, an employer with a maximum of 10 employees is allowed to exempt 2 employees, while larger employers may not exempt any employee at all from the order of priority.
Shorter time period for fixed-term employments
The employment form "special fixed-term employment" (Sw. särskild visstidsanställning) will replace the current "general fixed-term employment" (Sw. allmän visstidsanställning). A special fixed-term employment will be automatically converted to a permanent employment already after 12 months during a 5-year period. Today, a general fixed-term employment is converted to a permanent employment after 24 months during a 5-year period. In practice, this means a limitation on how long an employer may employ someone for a fixed-term.
Employees who have had at least 3 special fixed-term employments during a month may also credit the time between these employments as employment time. Employers who apply so-called hourly employments should pay extra attention to this change.
The employment is terminated despite an ongoing dispute
An employment will terminate after the end of the notice period, even if a dispute should arise regarding the validity of the termination. Today, the main rule is that the employment remains until the dispute has been resolved by the court, which can take a very long time.
Employees at temporary-work agencies
An employee who is employed by a temporary-work agency, and placed at a customer company, is entitled to a permanent employment at the customer company if the employee has been placed there for more than 24 months during a 36-month period.