Effortless Hiring in Sweden

Employment Contracts

• Swedish law mandates that employment contracts be in writing, detailing essential terms such as:
• Job responsibilities.
• Compensation.
• Working hours.
• Leave entitlements.
• Employers must provide this written contract within one month of the employee's start date to ensure clarity and mutual understanding.

Probationary Period

• Employers may implement a probationary period of up to six months. During this time, either party can terminate the employment with a shorter notice period, as specified in the employment contract.

Payroll Frequency

• Employees are generally paid on a monthly basis, with payments made at the end of each month.

Minimum Wage

• Sweden does not have a statutory minimum wage. Instead, wages are determined through collective bargaining agreements between employers and trade unions, which set industry-specific wage standards.

Overtime

• Standard working hours are typically 40 hours per week. Overtime is compensated at:
• 125% of the regular hourly rate for the first two hours.
• 150% for additional hours thereafter.
• Overtime is regulated by collective agreements and the Working Hours Act, which stipulates compensation rates and maximum allowable overtime hours.

Employee Contributions

1. Social Security: Employees contribute to national insurance schemes covering benefits like old-age pensions and unemployment.
2. Income Tax: Sweden employs a progressive income tax system with rates ranging from 9.28% to 49.5% depending on income levels and municipal tax rates.

Employer Contributions

1. Social Security: Employers are required to pay social security contributions, which cover benefits such as pensions, health insurance, and unemployment insurance.
2. Pension Contributions: Employers may be required to contribute to employee pension schemes, especially if mandated by a sector-specific pension fund.

Types of Leave in Sweden

1. Annual Leave

• Employees are entitled to a minimum of 25 days of paid annual leave per year (based on a five-day work week).

2. Holiday Allowance

• Employees receive a holiday allowance of at least 8% of their gross annual salary, typically paid in May or June.

3. Sick Leave

• Employees are entitled to sick leave with pay for up to 14 days; after this period, the employer pays at least 70% of the salary during sick leave for up to two years.

4. Parental Leave

• Each parent is entitled to 480 days of parental leave per child, with a portion compensated by the Social Insurance Agency.

Social Security Benefits

• The social security system provides various benefits including health care, pensions, unemployment insurance, and family allowances. Both employers and employees contribute to these programs.

Pensions

• Sweden has a comprehensive pension system comprising national and occupational pensions, ensuring financial security for retirees.

Notice Period

• The statutory notice period varies based on the employee's length of service:
• Up to 6 months: 1 day per month of employment.
• From 6 months to 1 year: 6 days plus an additional 2.5 days for each additional month.
• Over 1 year: At least 1 month.

Severance Pay

• While not mandatory by law, severance pay may be stipulated in collective agreements or individual employment contracts.

Dismissal Procedures

• Employers must have "just cause" for termination, which can relate to personal reasons (e.g., misconduct) or economic reasons (e.g., redundancy). Specific procedures must be followed, including consultations with trade unions.