Sweden employment compliance: a guide for employers

Sweden sets no minimum wage, and no collective agreement binds an employer that neither belongs to an employers’ association nor signed one. What trips employers up is the detail in the acts underneath that freedom. A relapse into sickness within five calendar days continues the same sick-pay period instead of starting a new one. And it is the employer, not the employee, who must report a sick employee to the Swedish Social Insurance Agency, by a hard calendar-day deadline.

Key takeaways

• Only membership of an employers’ association or the employer’s own signature binds an employer to a collective agreement. An agreement that is standard in the sector does not bind an employer on that basis alone.
• Within 7 calendar days of a new hire’s start, the employer confirms the core terms of employment in writing. The remaining terms follow within one month.
• Annual leave is 25 days a holiday year. An employee who started work after 31 August gets 5 days that year instead, and a separate formula decides how many of those days are paid.
• Sick pay is 80 percent of pay for the first 14 calendar days. A waiting-period deduction of 20 percent of an average week’s sick pay is taken once. The employer reports the case to the Swedish Social Insurance Agency (Försäkringskassan) by day 15, and 21 at the latest.
• For most employers, the employer tax return and payment are due by the 12th of the month after payment.
• Ending a permanent employment contract needs an objective ground and a notice period that runs from one month to six months by seniority.

What must an employment contract in Sweden include?

An employment contract can take any form, but the employer must confirm certain terms in writing on a fixed schedule.

Three more rules shape the employment contract itself:

• Probation lasts six months at most, and becomes permanent employment automatically if neither party ends it before the deadline.
• Fixed-term contracts come in only three forms: a special fixed-term contract, a temporary replacement, or seasonal work. A special fixed-term contract becomes permanent once the same employer has used it for more than 12 months in total within a rolling five-year period, or across consecutive fixed-term contracts each starting within six months of the last one ending. A temporary replacement becomes permanent after more than two years in the same five-year window.
• A collective agreement can change this. A central union can sign an agreement that reshapes probation length, the fixed-term conversion timeline, and several other rules above.

Put both written-terms deadlines on each new hire’s onboarding checklist, because they fall three weeks apart.

Does a collective agreement bind the employer?

No, not on its own. Nothing binds an employer just because an agreement is standard in its sector.

Under the Co-Determination Act, an organization’s agreement binds its members, within the agreement’s scope. Only two things bind an employer: membership of the employers’ association, or its own signature on a stand-alone agreement signed directly with a union (hängavtal). Sweden has no mechanism that makes a sector agreement generally binding on employers outside it.

An unbound employer still has to bargain with the union before a redundancy dismissal or a business transfer, and still has to keep unions with members among its staff informed. The duties compare like this:

For more information, see collective agreements in Sweden.

What must an employer do before a new employee’s first day?

Some of this has to be arranged before the first hour of work, because registration and withholding both depend on it.

1. Employer registration. Before paying wages to anyone who has not been approved for F-tax status (F-skatt), the employer registers with the Swedish Tax Agency (Skatteverket) through its employer registration service, or on paper form SKV 4620.
2. Work-injury insurance. It is funded automatically through the employer contributions the employer already pays on every salary. There is nothing separate to arrange.
3. Preliminary tax withholding. Until Skatteverket has issued the employee’s own tax-table decision, the employer withholds at an increased rate of 110 percent of the applicable tax table.
4. Occupational pension. Not a legal requirement. It exists only where a collective agreement covers the employee, or the employer has separately signed an individual pension contract for them.
5. The employment contract and its written terms. The employer confirms the core terms within seven days, covered under contracts.

One exception applies narrowly. A daily staff log (personalliggare) is mandatory only in six named industries: construction, vehicle service, body and beauty care, food or tobacco wholesale, restaurants, and laundry services. Most employers never need one.

Register with the Swedish Tax Agency before the first payday, since the withholding and reporting steps in payroll assume that registration is already in place.

Which labor laws are specific to Sweden?

Sweden has no statutory minimum wage. Pay floors exist only inside a collective agreement, and where none applies, pay is a direct agreement between employer and employee. The rest of the country-specific rules concern working time.

• Records are mandatory. The employer keeps records of on-call time, overtime and additional hours worked. Employees and workplace unions can inspect them.
• Almost all of this can be varied by agreement. A collective agreement signed or approved by a central union can change most of the limits above.

Check that on-call time and overtime are logged for every employee as they happen, since both overtime ceilings are measured on a rolling four-week or monthly basis rather than reset once a year.

How does an employer set up payroll in Sweden?

Once the employer is registered (before the first day), each payday follows the same steps.

1. Withholding. The employer deducts preliminary income tax from gross pay, following the employee’s tax table, or 30 percent for a side income.
2. The employer tax return (AGI). Every payment is reported monthly, per employee.
3. Payment. For employers with turnover up to 40 million kronor, the return and the payment of withheld tax and employer contributions are both due by the 12th of the month after payment. The deadline moves to the next banking day when the 12th falls on a weekend or public holiday.
4. Larger employers. An employer above 40 million kronor in turnover files on a fixed 26th, but still pays the withheld tax and employer contributions by the 12th, or the 17th in January.

Two exceptions change the total, and a third removes it entirely.

No registration, withholding or reporting is needed at all if total annual payment to one payee stays under 1,000 kronor.

For the full calendar of payroll deadlines, see the Sweden HR compliance calendar.

Which benefits must an employer provide?

The statutory benefits in Sweden are annual leave, holiday pay, sick pay and parental leave, alongside the state pension contribution and work-injury insurance.

The same-pay rule is the default for a monthly-paid employee. The percentage rule applies to an employee without a fixed monthly salary. It also becomes mandatory for a monthly-paid employee once a variable pay component reaches 10 percent of total pay, a threshold that commission and bonuses can cross sooner than expected.

Days above 20 paid days can be saved for later use, but a saved day must be taken within five years of the end of the holiday year in which it was saved. Holiday compensation for annual leave left unused at termination is due without undue delay, no later than one month after employment ends.

Sick pay ends on day 14. The Swedish Social Insurance Agency takes over from day 15, provided the employer reported the case by then, and no later than day 21. A relapse within five calendar days continues the same sick period rather than starting a new one, and a medical certificate is required for sick pay to continue from day 8 onward. Illness during annual leave is swapped out and paid as sick pay instead, if the employee asks without delay, and the remaining leave is rescheduled in one block unless agreed otherwise.

An employee gives at least two months’ notice before parental leave starts, or as soon as possible where that is not achievable. Occupational pension (tjänstepension) is never a statutory requirement: it comes only from a collective agreement or an individually signed pension contract.

For more information, see annual leave and holiday pay in Sweden, sick pay in Sweden and sick leave during annual leave in Sweden, or calculate one employee’s paid days with the Semesterdagar-räknare.

How does an employer end an employment contract lawfully?

Ending a permanent employment contract always needs an objective ground: redundancy, or a reason personally attributable to the employee, such as conduct or performance.

The compliant steps:

1. Selection. Where redundancy affects several employees, selection follows seniority within each operational unit or collective-agreement area. The employer may exempt up to three employees of special importance to the business, regardless of how many selection groups exist.
2. Advance notice. A personal-grounds dismissal needs at least two weeks’ advance notice to the employee and, at the same time, to their local union if they are a member. A summary dismissal needs at least one week.
3. Written notice. The notice of termination is in writing. It states how the employee can challenge it and whether they hold re-employment priority.
4. Re-employment priority. An employee with at least 12 months’ aggregate service in the last three years holds priority for nine months after termination, if suitable work becomes available. Shorter service thresholds apply to a special fixed-term contract or seasonal work.
5. Notifying the union on non-renewal. A union is also notified when a fixed-term contract is simply not renewed.
6. Reporting a larger redundancy. A redundancy affecting 5 or more employees, or reaching 20 dismissals within any 90-day period, is reported to the Swedish Public Employment Service (Arbetsförmedlingen). The notice period for that report scales from two months for up to 25 affected employees to six months for more than 100.
7. Final pay. Holiday compensation for unused annual leave is due without undue delay, no later than one month after employment ends (see benefits).

Confirm the notice of termination states how the employee can challenge it and whether they hold re-employment priority, before it is sent.

Frequently asked questions

Sources

• Försäkringskassan (n.d.) Sjuklön (sick pay for employers).
• Försäkringskassan (n.d.) Om din medarbetare är sjuk i mer än 14 dagar (if an employee is sick for more than 14 days).
• Försäkringskassan (n.d.) Föräldrapenning (parental allowance).
• Medlingsinstitutet (n.d.) Ordlista (glossary).
• Pensionsmyndigheten (n.d.) Finansiering av pensionssystemet (financing the pension system).
• Pensionsmyndigheten (n.d.) Har du tjänstepension? (do you have an occupational pension?).
• Riksdagen (1974) Lag (1974:13) om vissa anställningsfrämjande åtgärder (Act on Certain Employment-Promoting Measures), SFS 1974:13.
• Riksdagen (1976) Lag (1976:580) om medbestämmande i arbetslivet (Co-Determination Act), SFS 1976:580.
• Riksdagen (1977) Semesterlag (Annual Leave Act), SFS 1977:480.
• Riksdagen (1982) Lag (1982:80) om anställningsskydd (Employment Protection Act), SFS 1982:80.
• Riksdagen (1982) Arbetstidslag (Working Hours Act), SFS 1982:673.
• Riksdagen (1991) Lag (1991:1047) om sjuklön (Sick Pay Act), SFS 1991:1047.
• Riksdagen (1995) Föräldraledighetslag (Parental Leave Act), SFS 1995:584.
• Skatteverket (2026) Arbetsgivaravgifter (employer contributions).
• Skatteverket (2026) När ska jag lämna arbetsgivardeklarationen (when to file the employer tax return).
• Skatteverket (n.d.) Registrera dig som arbetsgivare (register as an employer).
• Skatteverket (n.d.) Personalliggare (daily staff log).
• Skatteverket (n.d.) Skatteavdrag (tax deductions).

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