Rights on the Swedish labour market

In Sweden, laws regulating the labour market are complemented by collective agreements, negotiated by trade unions and employers. This collective agreement is of great importance to the employee, as it stipulates wage rights and employment terms. Collective agreement coverage in Sweden is 90 percent of the workforce.

The value of a collective agreement

The collective agreement sets an important minimum standard for terms and conditions at your workplace. It deals with, for instance, holidays, wages and compensation in relation to overtime, parental or sick leave. The agreement serves as a floor, not a ceiling. You can always negotiate an even better deal in your employment contract.

No collective agreement – where does that leave me?

Without the collective agreement the employer can require you to work overtime without any compensation. Furthermore, Sweden has no legal minimum wage system, giving employers room to set wage levels as low as they wish. A collective agreement protects you from these issues. The employer is only bound by the law and does not have to give any employee benefits; such as extra holiday, additional parental pay or beneficial insurance schemes combined with pension and health plans, to mention just a few examples.

Union membership – welcomed by the employer

Sweden has a longstanding tradition of democracy, inclusion and transparency.  The Swedish model is the concept whereby employers and trade unions work together to maintain good working conditions. The model is a cornerstone and equally cherished by both parties. Hence, if your employer has entered into a collective agreement, your decision to join us will never be questioned and you should not fear any kind of reprisals. 

Work environment

Your work environment covers all conditions in the workplace: physical, organisational and social. 

The Swedish Work Environment Act stipulates that the employer is ultimately responsible for your work environment. The employer should take any actions necessary to prevent employees from being exposed to ill health or accidents. Even though the employer is fully responsible, the employees also have a responsibility to draw attention to potential problems, risks or possible improvements. 

Under the law, employers with staff numbers exceeding five must appoint a working environment representative; who shall monitor the work environment efforts of the employer. The main purpose being to ensure the wellbeing of you and your colleagues.

Working hours 

Your employment contract should give details of your working hours, generally regulated by the Working Hours Act, but can also be affected by a collective agreement. 

The law stipulates an overtime limit, a regular working week of maximum 40 hours and the right to rest during a working day.

Within the collective agreement between Finansförbundet and BAO (Banking Employers Organisation) a regular working week should not exceed 37,5 hours. This collective agreement applies to nearly 90 percent of our members.  

Gender equality and diversity

Gender equality and diversity are the concepts that Finansförbundet use when working with the seven grounds of discrimination (sex, transgender identity or expression, ethnicity, religion or other belief, disability, sexual orientation and age) covered by the Discrimination Act.   

The law says that no one should be exposed to harassment or discrimination in working life. Employees on parental leave are also protected against discrimination through the Parental Leave Act. It is the employer’s responsibility to ensure that discrimination is not taking place.

A simplified description of discrimination is: when a person experiences disfavourable treatment or when a person experiences that his or her human dignity is being violated.  

Parental leave

In addition to your legal rights concerning parental leave, it is possible that your company has further benefits. Ask your HR department or your trade union representative. 

These are your rights

  • You influence the way you organise your entitled parental leave. 
  • If you are included in our collective agreement with BAO or Svensk Handel, you receive additional pay, beyond the statutory parental pay, from Försäkringskassan (Swedish Social Insurance Agency).  
  • Your employer is obliged to keep you updated with bigger changes that take place during your absence.  


The Swedish pension system consists of three different pillars:

1) National Public Pension: Payed by the state and is an income related pension. 

2) Occupational Pension: The pension you receive when working for an employer that has a collective agreement. 

3) Own savings: If you like to complement your national public pension or occupational pension with personal savings, there are various favourable ways; such as Investeringssparkonto (ISK).  


All employees are entitled by law to five weeks’ of paid holiday per year. You might be entitled to additional leave according to your collective agreement or your employment contract.  

The employer is obliged to make sure that you take your holiday annually. You are entitled to four consecutive weeks between June – August.
As a general rule, holiday leave is your chance to rest, thus you have the right to cancel this under certain circumstances, for example due to illness.  


When falling sick, you are eligible for statutory sick pay (from the employer) and after 14 days you can apply for sickness benefit (from Försäkringskassan). If you are coved by a collective agreement, you are probably eligible for an extra percentage to complement the sickness benefit.