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Sweden’s Employment Protection Act (LAS) – What the Current Rules Mean
Understanding Sweden’s Employment Protection Act (LAS)
The Swedish Employment Protection Act (LAS – Lagen om anställningsskydd) lays out the core rules that govern employment relationships in Sweden. It covers how employment begins and ends, and what rights and obligations apply during termination or dismissal.
A major revision to LAS came into force in 2022, introducing important changes that now apply to all employers and employees. Below is a summary of the most relevant rules in effect today.
1. Dismissals must be based on “factual reasons”
Employers must base terminations on clear and objective facts. Unlike the older standard of “objective grounds,” today’s legal requirement is a factual reason. This change limits the influence of personal assumptions or speculation about future behavior when justifying a dismissal.
2. New rules for redundancy order
The “last in, first out” rule still applies when layoffs occur. Previously, only companies with 10 or fewer employees could exempt two people from the redundancy order. Now, all employers, regardless of size, may exempt up to three employees – but only once every three months, and across the entire organization.
3. Full-time employment is the new default
Employment in Sweden is presumed to be permanent and full-time unless otherwise agreed in writing. This means that if no specific agreement is in place, an employee is considered hired on a full-time, permanent basis.
4. New obligations for employers using agency staff
If an agency worker has been placed at the same workplace for 24 months over a 3-year period, the host company must offer permanent employment or pay compensation equivalent to two months’ salary.
5. New model for fixed-term employment
The previous “general fixed-term employment” contract has been replaced with a “special fixed-term employment” model. These contracts automatically convert to permanent employment after 12 months within a five-year period, even across multiple contracts. (Previously, this threshold was 24 months.)
6. Higher compensation for wrongful terminations
Courts still decide damages, but standard compensation amounts have increased:
- Unlawful termination: typically approx. 135,000 SEK (up from 80,000 SEK)
- Unlawful dismissal: approx. 190,000 SEK (up from 125,000 SEK)
7. Relocation investigations simplified
If a dismissal is based on personal misconduct, the employer only needs to investigate the possibility of reassignment once. Even if the employee later repeats similar behavior, no second relocation review is required unless a long period of time has passed since the first.
8. Seniority rules apply to reduction of hours
When reducing working hours across multiple employees, the employer must follow redundancy order principles. Employees with shorter length of service must be offered changes first, before those with longer tenure.
9. New rules for dismissal disputes
If a dismissal is contested, the employment still ends at the end of the notice period. During the legal process, the employer is not obligated to pay salary. The employee can instead claim unemployment benefits. If the court later overturns the dismissal, back pay and increased damages will apply.
Summary
Sweden’s current employment law strengthens clarity for both employers and employees. With full-time, permanent employment as the standard, stricter rules on dismissals, and new frameworks for fixed-term work and agency staffing, the LAS law now provides a more predictable and balanced foundation for the Swedish labor market.