Sweden: arrangement on new employment model for labour market entrants

14 March 2018 https://www.etui.org/ReformsWatch/Sweden/Sweden-arrangement-on-new-employment-model-for-labour-market-entrants

Based on an earlier deal between the social partners, the government and representatives of employees and employers have agreed on a new system of ‘entry agreements’. The aim is to help newly arrived immigrants and long-term unemployed people to become established in the labour market, and to facilitate future skills provision for employers.

In November 2017, the Confederation of Swedish Enterprise and the Swedish Trade Union Confederation (LO) reached an agreement in principle to make it easier for refugees and long-term unemployed to find jobs. With this deal the social partners demonstrated that they wanted to play an important role in ending long-term unemployment and in the successful introduction and integration of the large group of newly arrived immigrants. The proposed employment model was based on a fixed-term employment contract for a maximum of two years, which should be combined with Swedish for immigrants (sfi) and other short-term education, which had then to be transferred into permanent employment. This agreement became the starting point for negotiations with the government.

On 5 March 2018, the talks led to the conclusion of a tripartite agreement that will introduce a new employment model for labour market entrants. The new ‘entry agreement’ (‘etableringsjobb’) aims to help newly arrived immigrants and long-term unemployed to become established in the labour market, and to facilitate future skills provision for employers. In the letter of intent of the negotiation partners, it is said that the basic premise is that entry agreements should make it possible for newly arrived immigrants and long -term unemployed people to get a job with an employer covered by a collective agreement on entry agreements. The ambition is to cover at least 10,000 participants in the scheme.

Starting from 2019, an employer’s total payroll expenses for a position of this kind will amount to SEK 8,400 (826 euro) per month. In addition, the employee will receive a tax-free, individual state benefit amounting to at most SEK 9,870 (970 euro) per month in 2019. The government and the social partners have agreed that the salary and the individual benefit will follow wage developments. The individual state benefit can be claimed for no more than two years. The basic premise is that the size of the individual benefit should mean that there is an incentive for the individual to obtain regular employment. During the contract, which can last up to two years, the employees have the right to study Swedish during working hours without having their salaries docked. After two years, the employment should be turned into a direct contract. The intention is to start with entry agreements during the second half of 2019. The necessary legislative amendments will be submitted in a government bill to the parliament (‘Riksdag’) in March 2019. The government also will notify the European Commission of the planned legislation.