Viktoria Hybbinette Sanna Wedding September 7 2022 Employment Protection Act reforms offer more flexibility and predictability to employers and employees Wistrand | Employment & Immigration - Sweden Viktoria Hybbinette, Sanna Wedding Employment & Immigration IntroductionTermination of employment by employers requires objective reasonGreater possibility for employers regarding rules of priorityNew rules for disputes on validity of employment terminationFull-time employment as main ruleGeneral fixed-term employment is replaced by "special fixed-term employment"Requirement to offer employment to staff from staffing and recruitment companiesMore information for employeesCommentIntroductionAt the beginning of June 2022, the Riksdag adopted several amendments to employment law, primarily the Employment Protection Act. The idea behind the reforms is, among other things, to give employers more flexibility and possibilities to make organisational adjustments for the benefit of the business.On the other hand, the amendments provide employees with increased predictability regarding employment conditions, such as regarding working time and forms of employment. New rules regarding employer's termination of employment due to personal reasons have also been enacted increase predictability for employers.This article provides an overview of some of the recent changes to the Employment Protection Act.Termination of employment by employers requires objective reason Employment terminations by employers must be based on objective reasons instead of objective grounds, which applied under the previous rules. The purpose of this change is increase predictability for when terminations can be used for personal reasons (ie, the employee's behaviour). The change is not intended to affect terminations based on redundancy.Where there are personal reasons, the employee's interest in retaining their job or consideration for how they may behave in the future are no longer relevant factors that may protect an employee from termination.Greater possibility for employers regarding rules of priorityThe rules of priority that applied for termination of employment based on redundancy have also been changed. All employers will be able to exempt three employees from the redundancy priority list, in contrast with the previous rule that restricted employers with a maximum of 10 employees to exempt only two employees from such a list.New rules for disputes on validity of employment termination Employment ends when the notice period expires, even if there is a dispute about the validity of the termination. This means that employers will no longer have to pay salaries and other employment benefits while the dispute is ongoing, which in the past has been considered a burden for employers and presented financial risks. Should the court eventually invalidate the termination, the employer will be obliged to pay the salary and other relevant remuneration for the time that the dispute has lasted.The levels for damages due to employees for unlawful termination have also been increased.Full-time employment as main ruleFull-time employment becomes the main rule when nothing else is specifically agreed between the parties. Anyone who is not a full-time employee is entitled to a written explanation from the employer within three weeks.General fixed-term employment is replaced by "special fixed-term employment"Fixed-term employment will, among other things, be converted into permanent employment when the employee has been employed in a special fixed-term employment for more than 12 months in total during a five-year period. Before the amendments, the transformation of general fixed-term employment took place after 24 months, meaning that it would automatically occur within a significantly shorter period.Requirement to offer employment to staff from staffing and recruitment companiesThis rule did not previously exist under Swedish law. The new rule means that, in some cases, a client company will be obliged to offer staff hired from an external party a permanent job or pay the individual fixed financial compensation. This is if an individual has been placed in the same operating unit at the company for more than 24 months over a three-year period.More information for employeesEmployees are given the right to more detailed information about their employment and employment conditions, based on EU law. Additional information to be provided to employees includes:information about the workplace;remuneration methods and frequency;conditions for overtime work;working hours and planning of working hours and drafting of schedules; andrules on termination of employment.It is likely that such information will be part of written employment agreements.CommentThis article has provided an overview of some legal changes to the Employment Protection Act. The full impact of the amendments will become clearer when the law is applied and through case law. At the same time, previous precedents and methods of application could still be relevant to various extents. Different transitional rules may apply for the amendments and the old rules may remain effective in some cases. This, and the application of the rules in general, should be assessed on an individual basis.For further information on this topic please contact Viktoria Hybbinette or Sanna Wedding at Wistrand by telephone (+46 31 771 21 00) or email ([email protected] or [email protected]). The Wistrand website can be accessed at www.wistrand.se.