Fixed-term contracts and changes to the Foreign Posting of Employees Act

On 7 July 2011, the Swedish government proposed some amendments to the Employment Protection Act regarding the use of fixed-term contracts and to the Foreign Posting of Employees Act regarding a reporting duty to the Swedish Work Environment Authority.

Fixed-term contracts

As reported previously, in Spring 2010 the Swedish government were criticised by the EU Commissioner László Andor over the Swedish Employment Protection Act’s treatment of fixed-term employment. He expressed  the opinion that the Swedish regulations, intended to prohibit abuse of fixed-term contracts, were unclear and in need of change. Fixed-term contracts should not, according to  EU-directive 99/70/EC,  follow on from each other without a limit on total time being set. When the limit has been reached, the fixed-term contract becomes a contract for permanent employment. To date, Sweden has imposed a limit on the use of successive fixed term contracts for each of the various different categories of fixed term contracts but this limit does not come into play when different categories of fixed term contracts are used in combination with each other.

Taking into account this criticism, the Swedish Government proposes to amend the Employment Protection Act so that an employee can seek a judicial declaration that a fixed-term contract is permanent if different categories of fixed-term contracts have been combined in such a way that it could be seen as abuse by the employer.  If the amendment is approved, it will come into force on 15 June 2012.

Reporting duty: foreign posting of employees

The Swedish Government is also proposing amendments to the Foreign Posting of Employees Act to require foreign employers who post employees in Sweden for more than five days to report the posting to the Swedish Work Environment Authority as well as appointing a contact person in Sweden.

The proposal has come about because authorities, such as the Swedish Work Environment Authority, the Police Authority, the Swedish Tax Agency and employee organisations, are currently unable to obtain information about employees who are posted in Sweden by foreign employers. Consequently, Sweden is not fulfilling its obligations under the Posting of Workers Directive (96/71/EC). It is proposed that the changes will take effect from  2 July 2012.