Prolongation of Covid-19 support measures

Several Covid-19 support measures have been prolonged and will continue to apply during the spring of 2021, amongst others:

• The short-time work allowance will continue to apply until 30 June 2021.
• The restructuring support will continue to apply until April 2021. A prolongation to June 2021 is awaiting approval from the European Commission.
• The Swedish state will continue to bear the employers’ higher costs for sick pay until April 2021.
• The temporary abolishment of the requirement for employees to present a doctor’s certificate from sick day eight and onwards has already been prolonged until April 2021, as well as the abolishment of the qualifying deduction for sick pay (Sw. karensavdrag).

Several appeals regarding the short-time work allowance

The media has reported that the Swedish Agency for Economic and Regional Growth in several cases has not applied the law regarding short-time work allowance correctly and thereby made wrong decisions regarding allowances to companies during the pandemic. In at least 20 cases tried by the Administrative Court of Stockholm, the court has stated that the agency has not applied the law correctly and over 60 employers have had their appeal ruled in their favor. However, in a clear majority of the over 500 cases tried by the court so far, the court has ruled in favor of the agency. Over 5,000 appeals have been made to the Administrative Court of Stockholm and more can be expected.

Ruling from the Labor Court regarding the requirement to give notice of termination in person

In a recent case from the Labor Court, the court ruled that it was not reasonable to demand that the notice of termination, with mandatory information on actions to be taken in order to claim damages or invalidity, should have been given to the employee in person (as is the main rule). The court accepted that the employer had sent the notice in a registered letter to the employee’s last known address when the employee did not show up at the meeting with the employer because the employee had symptoms of Covid-19. Thus, the time limit had begun to run ten days after the employer had sent the registered letter to the employee, despite the fact that the employee did not collect the letter and thus did not receive any notice of action for invalidity. [AD 2021 nr 3]

Consequences of the employer not correcting misunderstandings regarding a termination

In a recent case from the Labor Court, the court tried whether an employee had been summarily dismissed or resigned voluntarily when she after a meeting with the managing director did not perform any work. The employee thought that she had been terminated during the meeting whereas the employer held that the employee had taken time off and thereafter did not show up for work. The court stated that where the employer has reason to believe that an employee perceives himself as dismissed, the employer must clarify the situation and correct any misunderstandings regarding the employment. The employer may not use any uncertainty or ambiguity to allow the employment to end. Since the employer had not corrected the misunderstanding, the court found that the employee had been summarily dismissed. Since there was not just cause for termination, the employer was obliged to pay damages in accordance with the Swedish Employment Protection Act. [AD 2021 nr 14]

If you would like more information or specific advice, please contact our L&E team.

Stricter rules on posting of workers

On 30 July 2020, stricter rules on posting of workers entered into force, thereby implementing the revised posted workers directive (Directive 2018/957). The new rules mean, among other things, that the remuneration that employee organizations may require in collective bargaining agreements is no longer limited to the minimum level, meaning that posted workers shall be entitled to a remuneration equivalent to that of locally employed workers in a comparable situation. Workers on long-term postings shall be entitled to the same terms and conditions of employment as apply to locally employed workers with only some exemptions.

Furthermore, employers must report the posting to the Swedish Work Environment Authority and appoint a contact person in Sweden no later than the date the posting begins and provide documentation to the recipient of service in Sweden that the posting has been reported. If the recipient does not receive any documentation from the employer, the recipient has an obligation to notify the Swedish Work Environment Authority.

Negotiations regarding a modernization of the Swedish labor law have stalled

On 1 June 2020, a special investigator presented its inquiry on a modernization of the Swedish labor law. The proposed bill has been much debated and widely criticized by employee organizations and the Left Party (Vänsterpartiet). The parties of the labor market were given a chance to work out an agreement before 30 September 2020 that would apply instead of the bill but have not yet managed to reach an agreement. The negotiations will therefore continue during the fall.

The Labor Court clarifies that a probationary period may be extended under certain circumstances

On 30 September 2020, the Labor Court ruled in a case where an employer had decided that a probationary employment would not be transferred into a permanent employment because the employer did not consider itself able to assess the employee’s performance because he had been on parental leave for most of the probationary period. The reason for the parental leave was mainly that his wife had suffered from postpartum depression. The case concerned whether the employee had been subjected to discrimination on the basis of sex or disadvantaged in violation of the Parental Leave Act.

The Labor Court held that the employee had not been discriminated against since the employer’s decision was unrelated to the reason why the employee took parental leave. However, the Labor Court found that the employee had been disadvantaged due to his parental leave in violation of the Parental Leave Act. In its ruling, the Labor Court clarifies that the Employment Protection Act does not hinder an employer and an employee, in a situation where the issue of terminating the employee’s probationary employment has been raised due to the employee being absent from work during large parts of the probationary period, to agree to extend the probationary period with a period corresponding to the absence. [AD 2020 nr 53]

Cecilia Bergman, Associate

If you would like more information, or specific advice, please contact our L&E team.

More and more employers now offer their employees antibody tests for the purpose to find out whether the employees have been ill with covid-19 or not. The tests are often carried out by a private care provider, even so the employer may come to process personal data on employees’ health. This article briefly guides you on what employers should have in mind in such situation.

What is health data?

All data related to the state of an individual’s past, current or future physical or mental health constitute health data. “Health” shall therefore be interpreted broadly and includes everything from illnesses to broken joints and vitamin deficiency. According to the GDPR, health data merit specific protection.

The following are examples of personal data that, directly or indirectly, constitute health data:

• Result from an antibody test that indicates if a person has or lacks antibodies against covid-19.
• Data from a survey in which the employee answers questions regarding its health, such as questions on symptoms or if the employee belongs to a risk group.
• Data that is not by itself a health data but linked to a health data.

When can I process health data?

The main rule is simple, processing of health data is prohibited, however there are a number of exceptions. An employer may for instance process health data if necessary to fulfil its obligations under the Swedish employment legislation. The employer’s work environment responsibility entails, for example, that they shall investigate possible risks for employees to be exposed to infection as well as prevent infection and spread of infection.

An employer shall in accordance with the principle of data minimisation only process relevant personal data and within the scope of the purpose. The employer should, if not necessary, avoid using the names of employees that have tested positive for antibodies against covid-19. If an employee is working from home due to the result of the antibody test, the employer should avoid informing internally about the reason why the employee does so.

What information should I give to the employees?

Employers have an extensive responsibility to provide information. Data subjects shall amongst other have been informed of the processing, its reason and how the data is processed. If the employer wishes to process personal data for a purpose other than it was originally obtained, employees must usually be informed of this before this second processing is carried out.

Some practical tips

• Inform about the processing of personal data.
• Have routines for how health data should be processed, e.g. who can access them.
• Instruct those who process health data on how to treat such data.
• Ensure safety during the processing, e.g. note that health data may not be sent over open networks in unencrypted e-mail.

If necessary, carry out an impact assessment before initiating the processing.

New rules limit the right to take industrial actions

On 18 June 2019, the Parliament passed a bill to expand the peace obligation in workplaces with a collective bargaining agreement in place, and in disputes, through amendments to the Employment (Co-Determination in the Workplace) Act (1976:580). In order for an employee to participate in an industrial action against an employer who is bound by a collective bargaining agreement, the purpose must be to achieve a collective bargaining agreement and the trade union must have negotiated its demands with the employer. Further, it will not be allowed for an employer or an employee to take industrial actions to exert pressure in a dispute.

The new rules will enter into force on 1 August 2019.

The employment protection is extended until the employee reaches the age of 69

On 18 June 2019, the Parliament passed a bill on extended employment protection until the employee reaches the age of 69. The employment protection provided for under the Employment Protection Act (1982:80) is intended to give employees security in their employment and protect the employee from being terminated without just cause. Today, employees have a right to remain in their employment until they reach the age of 67. Through amendments to the Employment Protection Act (1982:80), employees will have a right to remain in their employment until they reach the age of 69. After that, it will become possible to terminate the employee by a simplified termination procedure and without just cause. Other rules in the act, such as notice periods and priority right to re-employment, will also be affected by the new age limit.

The new rules will enter into force gradually; on 1 January 2020, the new age limit will be 68 years and on 1 January 2023, the age limit will be 69 years.

Special investigator appointed to review the Swedish labour law

The Government has decided to appoint a special investigator to investigate a modernization of the Swedish labor law. The directives are to focus on four sub-assignments and the inquiry shall be presented to the Government by 31 May 2020. In short, the sub-assignments entails that the special investigator shall prepare legislative proposals on extended exemptions from the rules on the order of priority, employers’ responsibility for competence development and employee adaptability, lower termination costs, and consider legislative proposals in order to create a better balance in the employment protection for employees with different employment conditions.

The inquiry and its given directives are based on the January Agreement, a political agreement between the Social Democrats, the Centre Party, the Liberals and the Green Party. According to the January agreement, amendments to the Employment Protection Act (1982:80) shall be implemented by 2021.

Reduction of employers’ contributions for persons under the age of 18

On 18 June 2019, the Parliament passed a bill on reduced employers’ contributions for persons under the age of 18. According to the new rules, the employers’ contributions for employees who are 15-17 years of age with a maximum salary of SEK 25,000 per month shall be 10.21 per cent. The aim is to provide opportunities for young people to receive summer jobs and part-time jobs during their studies so that they get work experience and become attractive for future employers.

The new rules will enter into force on 1 August 2019 and shall apply to all remuneration paid after 31 July 2019.

Cecilia Bergman, Associate

If you would like more information, or specific advice, please contact our L&E team.

Director-general wrongfully terminated by the state

On March 6, 2019, the Labor Court found that the state had wrongfully terminated Maria Ågren, the former director-general of the Swedish Transport Agency. In connection with an outsourcing arrangement between the agency and IBM, Maria Ågren decided to deviate from Swedish laws by giving foreign technicians working for IBM access to the agency’s IT systems containing confidential information, even though the technicians had not undergone security clearance checks. The state first transferred Maria Ågren to the position as director-general in the Government Offices, but after she accepted a summary imposition of a fine (fine of SEK 70,000) for being “careless with secret information”, the state terminated her employment with immediate effect. The Labor Court found that Maria Ågren, without fault of her own, had been put in a difficult situation as a newly appointed director-general. The court therefore came to the conclusion that Maria Ågren – despite the serious criticism that can made against her actions as director-general of the Transport Agency – had not breached her obligations in such serious way that it justifies a termination with immediate effect from her employment in the Government Offices. The termination was therefore declared null and void. [AD 2019 nr 15]

Reasonable notice period for a managing director

On February 20, 2019, the Labor Court granted an interim order prohibiting a former managing director who had resigned to compete with his former employer until the notice period expired. The court held that the managing director shall observe a reasonable notice period of six months since no notice period had been agreed upon between the parties. Managing directors are normally exempted from the Swedish Employment Protection Act which contain statutory provisions on notice periods for both the employee and the employer. Instead, managing directors and their employers are free to agree upon the terms and conditions of employment in accordance with general principles of contract law. According to case-law, a notice period of six months is reasonable in case the employer wants to terminate the managing director in a situation where no notice period has been agreed upon. From this ruling, the conclusion can be drawn that six months’ notice is also reasonable in case the managing director wants to terminate the employment and no notice period has been agreed upon. [AD 2019 nr 12]

New guide by the Equality Ombudsman regarding active measures

In January 2017, the rules regarding active measures in the Discrimination Act became stricter. The Equality Ombudsman is now launching a new digital guide to support employers’ work with active measures to prevent discrimination and promote equal rights and opportunities. The guide will give employers guidance on how to work with active measures and an insight into the various areas covered by the law. During 2019, the guide will be supplemented with more tips and examples.

http://www.do.se/om-do/pressrum/aktuellt/aktuellt-under-2019/ny-guide-hjalper-arbetsgivare-forebygga-diskriminering/

Cecilia Bergman, Associate

If you would like more information, or specific advice, please contact our L&E team.

Read our latest newsletter in the area of banking and finance here: Supreme Court decides on enforceability of electronic promissory notes.

New ruling re a job seeker who refused to shake hands during interview

On 15 August 2018, the Labor Court ruled in a case regarding discrimination during a recruitment process. During a job interview, a job seeker refused to greet the company’s representative by handshake because her interpretation of Islam does not allow such greeting with a person of the opposite sex. The company cancelled the interview and the recruitment process and the job seeker then sued the company for discrimination. In the Labor Court, the company referred to its policy, which aims to prevent, among other things, discrimination based on sex and requires all employees to be able to greet persons of the opposite sex by handshake. The Labor Court came to the conclusion that the policy discriminated women who, because of their religious belief, do not shake hands with men and that the policy is not appropriate, necessary and proportionate in order to achieve the legitimate objectives. The cancellation of the recruitment process thus constituted unlawful discrimination under the Discrimination Act and the company was liable to pay damages. [AD 2018 nr 51]

New ruling re non-competition clauses in employment contracts

In a new ruling, the Labor Court has considered, inter alia, the reasonableness of non-competition clauses in employment contracts and the limits of employees’ duty of loyalty. The case concerned four employees who resigned to engage in a competing business. Question arose whether the four employees had breached their duty of loyalty during their employment and if two of them had breached a non-competition clause in their employment contract. As regard the two-year long non-competition clause, the court found that it was reasonable in relation to one of the employees. The employee had breached the clause and was therefore liable to pay liquidated damages in accordance with the contract. The court considered, among other things, that the employee had agreed to the non-competition clause in connection to an asset transfer where she had received consideration also for goodwill and that she personally had many of the licenses required to conduct the business. In relation to the other employee, however, the court found that the non-competition clause was unreasonable and therefore not enforceable since the employee, among other things, had not received any compensation or had a significant role in the company. The ruling confirms previous case law that non-competition clauses are generally unreasonable if the employee does not receive any financial compensation for the undertaking. Further, the Labor Court found that one of the employees, and probably another as well, had breached their duty of loyalty during the employment but no damages were imposed as the company had not proved the financial damages it had suffered due to the breach. [Arbetsdomstolen 2018 nr 49]

New rulings re non-solicitation clauses in employment contracts

The Labor court recently gave its ruling in two cases regarding non-solicitation clauses in employment contracts. The cases concerned three employees working with game development who resigned to engage in competing businesses and question arose whether the non-solicitation clause in their employment contracts prevented them from hiring employees of the former employer.

In its ruling, the court held that when assessing the reasonableness of a non-solicitation clause, consideration shall be given to whether the employer has a legitimate purpose with the clause. If the sole purpose with such clause is to prevent that a former employee encourage other employees to leave their employments, for instance to start working for a competitor, the limitation can only be justified for a short period of time. The court held that at the time of the trial, 6, 15 and 18 months had passed since the termination of employment and the employer’s legitimate interest of maintaining the clause should have subsided.

The court noted that the restriction was not limited to any category of employees, such as employees who the former employees had worked with, had certain knowledge about or employees of the company or group company with specific skills or knowledge. Further, the clause was not limited to active recruitment by the former employees, they were not allowed to employ employees of the company or group company that turned to them for new employment without their encouragement.

The court came to the conclusion that the non-solicitation clause in the employment contracts was unreasonable and therefore not enforceable. [AD 2018 nr 61 and AD 2018 nr 62]

In the light of these rulings, employers should review their use of non-solicitation clauses and consider the following; (i) can the restrictive period be shortened? (ii) could the category of employees be limited? (iii) can the type of forbidden actions be limited, for instance only cover active recruitment by the former employee?

Cecilia Bergman, Associate

If you would like more information, or specific advice, please contact our L&E team.

The parties of the labor market present a bill on a restriction of the right to take industrial actions

In response to an ongoing review of the right to take industrial actions and possible implementation of restrictions assigned by the government to a special investigator, the parties of the Swedish labor market (i.e. employers’ associations and trade unions) have agreed upon a restriction and presented a bill to the government. According to the bill, it shall no longer be permitted to take industrial actions that are not intended to achieve a collective bargaining agreement. The Swedish Minister for Employment and Integration has described the bill as well-balanced and announced that the government plans to go forward with it.

Exemption from discrimination regulations for small-scale businesses are withdrawn

When inadequate accessibility was initially established as a form of discrimination under the Swedish Discrimination Act (2008:567) in 2015, businesses within the areas of retail and services with less than ten employees were exempted. As of 1 May 2018, this exemption is withdrawn, with the consequence that these small-scale businesses now have an obligation under law to adapt their services and premises to ensure accessibility for persons with impairments.

The right to perform inspections at the workplace by the police is extended

Through an amendment to the Swedish Aliens Act (2005:716), the Police Authority’s right to perform workplace inspections to check that employers do not employ individuals without required permits is extended. The workplace inspections do not require a concrete suspicion but is limited to industries where there is a greater risk of such employments. The fine for hiring individuals without required permits have also been increased. The amendments entered into force on 1 July 2018.

New requirements on rehabilitation plans

As of 1 July 2018, employers with an employee who can be expected to be absent from work for more than 60 days due to sickness are obligated to prepare a written plan for the employee’s return to work (a “rehabilitation plan”). Such plan shall be prepared within 30 days calculated from the first day of the employee’s sick leave, however, failure to prepare a rehabilitation plan is not associated with any specific sanction. The purpose of the rehabilitation plan is to support the work carried out in the workplace to enable the employee to return to work.

Cecilia Bergman, Associate

If you would like more information, or specific advice, please contact our L&E team.

Please read our latest newsletter in the area of banking and finance here: New information requirements for bond prospectuses and other financial instruments.

Employers’ right to require a copy of candidates’ criminal record will be reviewed

It has become more and more common for employers to request candidates to present a copy of their criminal record. The Swedish government has therefore appointed a special investigator to investigate the need for a prohibition for employers to require candidates to present a copy of their criminal record, unless it is required by law. The review shall be completed on 31 January 2019.

Contractors’ responsibility for wage claims in the construction industry

On 16 February 2018, the Swedish government proposed a bill on greater responsibilities for wage claims for contractors. The purpose with the proposed bill is to protect the salaries of employees and to counter unfair competition on the market.

According to the bill, an employee working for a subcontractor and who does not get paid for his work shall be able to direct his wage claim towards the subcontractor who engaged his employer or the head contractor. The new rules are proposed to enter into force on 1 August 2018.

New act on trade secretes presented to the Parliament

On 8 February 2018, the government presented a bill on a new act regarding strengthened protection against the misappropriation of trade secrets. The bill is based on an EU directive and was submitted to the Parliament on 21 March 2018. The proposed act will make it possible to claim damages in more situations and more actions will be regarded as misappropriation of trade secrets.

The act shall not limit employees’ right to report any misconducts (whistleblowing) and companies will have a greater responsibility to inform employees of what they consider to be confidential information. The new act is proposed to enter into force on 9 June 2018.

Cecilia Bergman, Associate

If you would like more information, or specific advice, please contact our L&E team.