Living and working in Sweden

Actors and institutions

Trade unions, employers’ organisations and public institutions play a key role in the governance of the employment relationship, working conditions and industrial relations structures. They are interlocking parts in a multilevel system of governance that includes European, national, sectoral, regional (provincial or local) and company levels. This section looks into the main actors and institutions and their role in Sweden.

Public authorities involved in regulating working life

Public authorities facilitate dispute resolution and make sure that laws are followed. They do not interfere with the collective bargaining tradition between social partners. The Ministry of Employment is responsible for labour market policy, working life policy and integration in Sweden. Important public authorities that lie under the Ministry of Employment are the Swedish Labour Court (Arbetsdomstolen), which rules on labour-related disputes, and the Swedish Work Environment Authority (Arbetsmiljöverket), the labour inspectorate that monitors and promotes health and safety measures at work. The Swedish National Mediation Office (Medlingsinstitutet) also lies under the Ministry of Employment. Its role is to mediate in labour disputes and promote efficient wage formation processes.

Representativeness

In Sweden, industrial relations are based on trust and mutual understanding and the tradition of a self-regulating system of collective agreements is firmly established. The government’s legislative role is limited and there is no formal procedure for recognising employers’ or employees’ organisations. Instead, decisions regarding participating parties in bargaining processes are made through custom and practice.

More information on representativeness of the main social partner organisations can be found in Eurofound’s representativeness study of the cross-industry social partners or in Eurofound’s sectoral representativeness studies.

• Topic: Representativeness

Trade unions

About trade union representation

Trade unions have a traditionally strong role in the Swedish labour market. The right to become a member of a trade union is regulated in the Codetermination Act. Since the 1938 Saltsjöbadsavtalet agreement, trade unions and employers have had the right to negotiate wages and working conditions in collective agreements.

While trade union membership has declined since the beginning of the twenty-first century, trade union membership in Sweden is still high by international standards. At the start of the twenty-first century, trade union density was around 80%. However, there was a large membership loss in 2007 when the government increased fees for the unemployment insurance funds, which are connected to the trade unions. According to the new regulations, the fees were to be based on the level of unemployment among the members. This meant that unions with higher levels of unemployment had higher fees.

In addition, unemployment rose more among blue-collar workers than among white-collar workers during the European financial crisis, meaning that blue-collar union fees increased disproportionately to those of white-collar workers. As a result, blue-collar union membership fell by seven percentage points between 2008 and 2014, whereas white-collar union membership rose by two percentage points over the same period (Kjellberg, 2018). The fee differentiation was abolished again in 2014. Since 2008, the overall trade union density has been stable at around 70%.

Trade union membership and trade union density

Source: OECD/AIAIS (2021); Kjellberg (2019a, b, 2021b)

Note: membership data only covers active members. That means unemployed members are included but not pensioners, students or self-employed (except from 2015 and onwards when self-employed people organised by The Swedish Confederation of Professional Associations (Saco) are also included in the data).

Main trade union confederations and federations

On the employee side, there are three main peak-level social partner organisations:

• The Swedish Trade Union Confederation (Landsorganisationen i Sverige, LO) had 1.25 million active members in 2017. LO is mostly associated with blue-collar workers.
• The Swedish Confederation of Professional Employees (Tjänstemännens Centralorganisation, TCO) represented 1.09 million active members in 2017. TCO is mostly associated with white-collar workers.
• The Swedish Confederation of Professional Associations (Sveriges Akademikers Centralorganisation, SACO) represented around 533,500 active members in 2017. SACO is mostly associated with university graduate employees.

Main trade union confederations

Source: Kjellberg (2019a)

Trade unions are demarcated by sector. There are approximately 60 trade unions, most of which are members of one of the three major trade union confederations mentioned above.

Employers’ organisations

About employers’ representation

Membership in an employers’ organisation is voluntary and usually includes the signing of a collective agreement, although exceptions exist (e.g. in the commerce sector). In contrast to the trade unions’ declining memberships, employers’ organisations have not experienced any similar membership loss and have remained at a stable level for the past two decades. Today, employers’ organisation density is at a higher level than trade union density (Kjellberg, 2019).

Employers’ organisations – membership and density

* Percentage of employees working in an establishment that is a member of any employers’ organisation that is involved in collective bargaining.

Main employers’ organisations

On the employer side, there are three main confederations: one for the private sector and two for the public sector. The largest private employers’ organisation is the Confederation of Swedish Enterprise (Svenskt Näringsliv), representing approximately 60,000 small, medium and large companies, with around 1.9 million employees.

The Swedish Association of Local Authorities and Regions, SALAR (Sveriges Kommuner och Landsting, SKL) is the largest employers’ organisation for the public sector, representing 290 municipalities and 20 regions (previously county councils) with over 1 million employees.

The Swedish Agency for Government Employers, SAGE (Arbetsgivarverket) is the membership organisation for government agencies. SAGE represents approximately 250 public authorities and agencies for the 250,000 government employees.

Most employers with a collective agreement are also members of an employers’ organisation. If the employer wishes to sign a collective agreements without becoming a member of an employers’ organisation, they can opt for a voluntary extension agreement (hängavtal) directly with the trade union.

Main employers’ confederations

Source: National Mediation Office (2020)

Agreements between the confederations (peak-level organisations) are known as central agreements (centrala överenskommelser) . These generally concern negotiating procedures. Collective wage bargaining is done at the sectoral and local level.

Tripartite and bipartite bodies and concertation

Tripartite negotiations are rare in Sweden. Sweden has a tradition of discussion and cooperation between the social partners that establishes the terms of collective bargaining. The social partners do not welcome intervention by the government, and the tradition of self-regulation through collective bargaining by social partners is strong.

Negotiations tend to start a few months before the current collective agreement is set to expire. Social partners in the manufacturing industry are usually the first ones to start bargaining as the main collective agreement in that sector sets the benchmark for other sectors. The Swedish Trade Union Confederation generally coordinates its member organisations to put forward a joint bid. Many collective agreements are signed and set to expire in the same period, which makes for big and intense ‘bargaining rounds’.

An important bipartite body is the Swedish Labour Court. This is a special court set up to rule on labour-related disputes. Both employer and employee interests are represented in the court. In addition, a significant development in recent times was the formation of the National Mediation Office in 2000, which was set up in order to help social partners reach agreements and promote a well-functioning wage structure.

Sweden also has around 10 job security councils (trygghetsråd), of which the three largest are Trygghetsrådet (TRR) for the private sector, Trygghetsfonden (TSL) for parts of the private sector and Trygghetsstiftelsen (TSN) for the central government sector. The job security councils are bipartite bodies that help employees and employers handle labour market transitions. The job security councils are based on collective agreements. They help employees who have been made redundant find new employment.

Main tripartite and bipartite bodies

Workplace-level employee representation

• Trade unions: Trade unions are the most common form of employee representation. They are present in almost all workplaces where there are collective agreements, either as local representatives or as a local branch of a trade union. Trade union representatives negotiate on issues between employers and employees. The Employment (Co - determination in the workplace) Act (1976:580) regulates employees’ right to join a trade union. The right to engage in union activities in individual workplaces is regulated in the Trade Union Representatives (Status in the workplace) Act (1974:358).
• Health and safety committees: Health and safety committees are present in nearly all workplaces, either in the form of a safety representative, a regional safety representative or a safety committee. The role of the health and safety representative or committee is to ensure that the employer follows work environment regulations, both physical and psychological. The Work Environment Act (1977:1160) states that each workplace with five employees or more must have a health and safety representative. It is the Swedish Work Environment Authority’s responsibility to ensure that the Work Environment Act. is followed.
• Board representation: Employees have the right to have representatives on the board of private companies with at least 25 employees in order to gain insight into and influence the board’s work. This is regulated in the Board Representation (Private Sector Employees) Act (1987:1245).

Regulation, composition and competences of the bodies