Increasingly equal treatment and protection of posted workers in Sweden

Today, the Swedish Parliament accepted the Government’s proposed legislation to implement the revised EU Posted Workers Directive into Swedish law. The new legislation mainly contains rules on increasing the equal treatment and protection of posted workers, but also includes stricter employer obligations. The new legislation will come into effect 30 July 2020.

In 1996, the first EU Posted Workers Directive (EG 96/71) (the First Directive), was introduced, with an aim to establish main rules for mandatory minimum protection for posted workers within the EU. Ever since, it has been debated whether the First Directive creates the right balance between the freedom to provide services and equal conditions of competition; while protecting the posted workers’ rights.

In 2018, the EU adopted a revised Posted Workers Directive (EG 2018/957) (the Revised Directive; jointly the Directives) in addition to the existing First Directive. The Revised Directive mainly contained regulations to enhance equal treatment between posted workers and domestic workers in matters of pay and other working conditions. The Revised Directive also contains increased protection for hired posted workers and long-term posted workers.

The new Swedish legislation has the purpose to implement the Revised Directive into the Swedish Posted Workers’ Act (the Act) by increasing the equal treatment between domestic and posted workers in the Swedish labor market, and ensuring stronger protection in the event of posting.

The legislative amendments are described below.

Equal pay and certain reimbursements for posted workers

In accordance with the First Directive, posted workers to Sweden shall be entitled to at least minimum wages for the actual work. Since minimum wage is not statutorily regulated In Sweden, guidance should be sought in the relevant central collective bargaining agreement(s) (CBA) in place within the relevant sector. Sweden now enhances the conditions for posted workers in line with Swedish CBAs, by deciding that the salary levels throughout a posting no longer should be limited to the minimum wage levels. Instead, a posted worker shall be entitled to the same salary levels as a Swedish worker performing the same work.

Additionally, the new legislation clarifies how to determine whether a posted worker is paid properly throughout the posting. For example, any reimbursements paid to the posted worker relating solely to expenses arising from the posting itself should not be considered salary under the Act, but rather a one-off cost. This refers to, for example, relocation costs from the home to host country.

Better protection for temporary agency workers posted to Sweden

The protection for temporary agency workers posted to Sweden is increased as well, so that these individuals are granted conditions equal to those of Swedish temporary agency workers. The current provisions on equal treatment for Swedish temporary agency workers should apply for temporary agency workers posted to Sweden as well.

Postings exceeding twelve months

The protection for long-term postings will be strengthened. According to the new legislation, all standard Swedish terms and conditions of employment should apply to long-term posted workers; with the exception of inter alia formal requirements regarding entering and termination of employments, occupational pension schemes and post-employment restraints. Today, under the Act, a posted worker is only granted mandatory terms and conditions relating to the so called “hard core” which refers to minimum wage, maximum working hours and minimum paid vacation days as well as protection under relevant discrimination and working environment acts, among other things.

A posting is considered a long-term posting if exceeding twelve months. However, an exception can be applied for up to 18 months, meaning that a posted worker only is entitled to protection as if the posting is less than twelve months. This exception should be applied for in advance and at the latest by the day the posted worker has been in Sweden for twelve months, to the Swedish Work Environment Authority.

If such extension has been granted, all regular Swedish work and employment conditions are to be applied should the posting exceed 18 months.

With the new legislation it is further confirmed that a posting can be considered to be long-term if different workers’ periods of posting are added together.

Extension of the right to take industrial actions

Under the Act, trade unions may take industrial actions for purposes of ensuring that posted workers are granted the mandatory employment terms and conditions set forth under the “hard core”. However, such industrial actions cannot be taken for purposes of claiming terms and conditions of employment – such as salary levels – exceeding those levels stated in the applicable central CBA relevant for the sector.

According to the new legislation, the right to take industrial action is expanded to cover claims for reimbursement of expenses for travel, food and conditions for accommodation in Sweden as to mirror levels offered to Swedish workers under any relevant central CBA. This right is granted to posted temporary agency workers as well.

Stricter notification obligation for employers

Foreign employers who post workers to Sweden will be required to notify the Swedish Work Environment Authority regarding the posting and state the contact person in Sweden from the first day of posting. Currently, the obligation to register the posting does not apply for postings up to five days. Employers that post workers to Sweden will be required to provide documentation to the service recipients in Sweden showing that a declaration has been made to the Swedish Work Environment Authority.

If the foreign employer does not fulfil these obligations, an administrative penalty can be imposed with an amount of SEK 20,000.

What will happen now

The legislative amendments will come into force on 30 July 2020; in accordance with implementation phase of the Revised Directive. Do not hesitate to contact us if you have questions or require assistance.

Marie Liebich, Sevim Güven, Faria Safari and Hanna Julin

 

Contact
Marie Liebich
+46 72 573 12 40

 

Contact
Sevim Güven
+46 72 230 95 20

 

Contact
Faria Safari
+46 70 961 78 36

 

Contact
Hanna Julin
+46 72 500 73 73