SALARY PAYMENT IN Swedish Krona (SEK, kr)
CONTRACT LANGUAGES Swedish / English
PAYROLL TAX 31.42%
PAYROLL CYCLE Monthly
TIME TO HIRE 24 hours
Hire and pay talents
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Horizons provides compliance solutions to ensure your business in Sweden operates in line with Swedish labor laws and tax regulations. Businesses benefit from hiring in, investing in, or job outsourcing to, Sweden in a range of industries, from customer service, to accounting services, to software development. We also process monthly payroll, and, as a Sweden Employer of Record, absorb all local employer liabilities. Partnering with our Sweden PEO is the quickest and most cost-effective way to enter the Sweden market.
|PEO Platform Hire in Sweden, and pay employees through our platform or app.||PEO Cost Our Sweden PEO solution is the most affordable on the market.||Time-to-hire Fast onboarding in Sweden, hire in as little as 24 hours.|
|Contracts We draft labor contracts compliant with Swedish labor law.||Local Benefits We administer all mandatory benefits and contributions in Sweden.||180+ Countries It doesn’t stop with Sweden — we are an international PEO|
Sweden’s employment law can be complex, so it is crucial that you always understand the regulations when trying to expand and hire in the country.
In Sweden, employers are required to provide written employment contracts for all employees. These contracts need to clearly include all related information, such as wage/salary, vacation and other benefits, working hours, and more.
Furthermore, all contracts issued in the country should be provided in the Swedish language and use the local Swedish krona currency.
By partnering with our Sweden PEO, Horizons’ team of local experts can provide assistance for drafting strong employment contracts that are compliant with local regulations.
|Termination notice period||1 – 6 months, depending on length of service|
At completion of contract: None
Before end of contract: 1 – 2 months’ salary per year of service, depending on the reason
|Probationary period||0 – 6 months|
|Termination notice period||1 – 6 months, depending on length of service|
|Severance||1 – 2 months’ salary per year of service, depending on the reason|
Normal working weeks are 40 hours in Sweden. In addition, employees are required to have 11 hours off between shifts and a minimum of 36 hours of time off every seven days.
48 hours is the legal limit of a working week, after which overtime must be paid. Overtime is limited to 200 hours per year, and is generally paid at a rate of 1.5 to 2 x normal payment. Alternatively, it can be accrued as time off work in the future.
Quick, compliant hiring in 24 hours—no subsidiary required.
Swedish employees generally receive 13 days of public holidays every year. Some employers choose to offer further annual holidays, but it is not necessary and can be negotiated on a case-by-case basis.
The following days are commonly celebrated nationally:
|1 Jan Sunday||New Year’s Day|
|6 Jan Friday||Epiphany|
|7 Apr Friday||Good Friday|
|8 Apr Saturday||Holy Saturday|
|9 Apr Sunday||Easter Sunday|
|10 Apr Monday||Easter Monday|
|1 May Monday||May 1st|
|18 May Thursday||Ascension Day|
|27 May Saturday||Whit Saturday|
|28 May Sunday||Whit Sunday|
|6 Jun Tuesday||National day|
|23 Jun Friday||Midsummer Eve|
|24 Jun Saturday||Midsummer Day|
|4 Nov Saturday||All Saints’ Day|
|24 Dec Sunday||Christmas Eve|
|25 Dec Monday||Christmas Day|
|26 Dec Tuesday||Boxing Day|
|31 Dec Sunday||New Year’s Eve|
Employees in Sweden are entitled to at least 25 days of paid holiday each year. Many employers offer more, and employees may request a larger allowance. Usually, vacation days are ‘earned’ one year in advance, so there is no law requiring employers to offer vacation leave in the first year of employment. However, many still do. Up to five days can be carried over if not used one year, for as many as five years into the future.
In Sweden, employees are not paid for their first day of sick leave, but are paid a rate of 80% of usual salary/wage for the next two weeks of absence. Beyond this, employers will need to refer the case to the Försäkringkassan (a government office) to assume responsibility of sick pay. Parents who need to take time off to care for a child (under 12 years old) can also access sick pay support.
Employees who are absent for more than seven days need to provide a medical note as proof of sickness.
Employees in Sweden can access up to 16 months (480 days) of parental leave, with mothers entitled to at least seven weeks before and after birth. The partner of the mother can take ten days of leave for the birth. The 480-day allowance can be shared between either parent, but 60 days of it are reserved for each parent specifically.
In terms of remuneration, employers are not required to cover parental leave payments (but many do), and parents can usually access government-funded support of 80% of normal salary. This is limited depending on the type of leave being taken, and is reduced to a significantly lower payment after 390 days of leave.
A further form of parental support allows parents with children under the age of eight to work part time at 3/4 hours (or more).
In Sweden, employers must inform employees of termination two weeks in advance of giving notice. Employees can then enter negotiations, where reasons are provided and may be requested in writing.
Notice periods depend on the length of employment, with employees of less than two years requiring one month of notice. This increases by one month for every additional two years of employment, with a maximum of six months after ten years. Employees are entitled to normal payment and full benefits throughout the notice period in most cases.
Employees who think they have been terminated wrongfully can sue, and may be entitled to damages of 1.5 to 2.5 years of salary. In many cases, employers also need to speak with an employee’s union.
Severance payments are not required in Sweden, but many employment contracts will include agreements to pay them.
Navigating employee terminations and handling severance packages can be complicated for companies expanding overseas for the first time. Horizons’ Sweden PEO can mitigate risk for foreign companies and provide guidance through this process.
In Sweden’s progressive taxation system, taxes are deducted by employers before salaries are paid. There is a municipal income tax of 32% (the average across municipalities) which applies to all employees regardless of income, and a national income tax of either 0% or 20%, dependent on income level.
As of 2020, the corporate tax rate in Sweden is 21.4%, but this is set to fall slightly in 2021.
Social benefits are funded in part by employers. Employers are required to pay around 30% of salary in contributions to a social insurance fund, which covers several social benefits like pension funds and sick leave payments.
The healthcare system in Sweden is universally available and funded by the government, so employers are not expected to offer private health insurance. However, some employers may choose to offer it as part of a benefits package to attract employees.
Sweden has a different minimum wage system to most countries, as there is no universal minimum rate. Instead, unions work to establish minimums on an industry or job-type-basis. For jobs that aren’t covered in this way by unions, an agreed wage should be established and written into the employment contract.
|Minimum Wage Country Comparison Chart||(Per month in USD)|
Establishing a Swedish benefits system for employees can be difficult. With a different language and a unique set of employment laws, building a comprehensive and compliant benefits system can take a long time and come at significant cost.
At Horizons, we specialize in building and running Swedish employee benefits systems. We’ll handle everything, using our experience to ensure you are ready to commence your Sweden operation as quickly as possible.
With Horizons, you get quick service, transparent pricing, and expert support.
A Sweden PEO and a Sweden EOR are two types of companies which specialize in providing human resources services to businesses in Sweden.
The main difference between a Sweden PEO and a Sweden EOR is in the scope of their services.
Sweden PEOs provide a full range of HR services, including payroll, benefits administration, and employee recruiting—all under one roof as a co-employer. Engaging a Sweden PEO is essentially outsourcing your HR duties in Sweden.
Sweden EORs actually take over as the legal employer of your employees based abroad. Sweden EORs become responsible for labor compliance for your employees in Sweden.
At Horizons, we offer both PEO and EOR services in Sweden. Get in touch now and let us know what service you are seeking.
A PEO in Sweden can feasibly hire both local and foreign nationals to work in Sweden.
However, the ability of Horizons to sponsor your foreign national employee in Sweden may be limited due to visa quotas practiced in many countries.
Contact us with your requirements and our Global Mobility team with review the case and get back to you within 2 business days.
In most cases, Horizons’ Sweden PEO can hire & onboard your employee within 24 hours. The actual start date of the employee will depend on their notice period obligation to their previous employer as well as any relevant hiring rules in Sweden.
It is possible to get a work visa in Sweden. Horizons’ Global Mobility team is a dedicated team of work visa experts. They assess the details of each case to determine feasibility and costs before Horizons applies for the work visa on behalf of your employee. If the Global Mobility team determines that your case is feasible, the process is smooth and transparent. Visa spots in Sweden are limited, however—get started today to secure your employees’ visa spot.