New temporary employment legislation does not affect provisions in collective agreement for painters

On 2 October 1997, a Swedish arbitration board ordered a small decorating business to pay damages for having hired two workers on a new form of temporary employment contract which had been provided for in the Employment Security Act. This was a breach of the collective agreement which was in force before the Act was amended.

According to the Employment Security Act workers are, as a rule, employed on permanent contracts. However, in certain situations specified in the Act temporary employment contracts are permitted. Many collective agreements contain provisions that specify the conditions under which temporary employment contracts can be used.

As from 1 January 1996 a new form of temporary contract - the so-called "agreed temporary employment" - was instituted in the Act. The trade unions were strongly opposed to this change, and refused to modify their collective agreements in order to allow the new form of temporary employment to be introduced. The employers' point of view was that the new Act superseded the old collective agreement, so that they had a right to use it anyway.

In February 1997, a small decorating firm hired two painters on agreed temporary employment contracts. The Painters' Union (Målareförbundet) sued the company for breach of the collective agreement. The trade union claimed that the collective agreement itself regulated all forms of temporary employment in this sector, and that only when the collective agreement had been modified to provide for new forms of temporary employment could such temporary employment contracts be introduced.

The trade union won the case. On 2 October 1997, an arbitration board ordered the employer to pay SEK 5,000 damages to the trade union for breach of the collective agreement. Two cases concerning similar agreements are pending in the Labour Court.