Government commissions review of labour legislation

In July 2000, the Swedish government commissioned the National Institute for Working Life to conduct a study to examine a possible overhaul of certain important aspects of labour legislation relating to job security, in the light of changes in the labour market and economy, such as the growth of "atypical" work.

On 13 July 2000, the government decided (N2000/2486/ARM) to launch a study of certain aspects of labour legislation concerning rules on job security, and gave the commission to the labour law department at the National Institute for Working Life (Arbetslivsinstitutet). The government wants to find out whether or not the existing rules meet employees' demands for security and influence within the framework of a flexible and effective labour market. The study is to be carried out in cooperation with the social partners and should be completed before 31 December 2001 .

The parliamentary labour market committee reported (1999/2000:AU5) in autumn 1999, in connection with the debate on a new wage formation system (SE9912110F), that the conditions for reaching the goal of making working life fairer and more secure may have altered. Major economic changes have recently occurred in society and private business; shorter-term and looser forms of employment have developed at the expense of full-time, open-ended jobs; and more and more workers have ceased to be employees and are being treated as self-employed by employers. These developments in the labour market might have led to a increasing number of people no longer being covered by job security legislation, the committee reasoned.

The new study commissioned by the government will take into account the report of the parliamentary committee, exploring employees' demands for security and influence in working life, and examining the increase in less traditional, "atypical" employment forms (such as fixed-term work) and the continuous need for training of the employees involved. The research is to start from the viewpoint of the current changes in the direction of "knowledge-based work and of internationalisation", and will take special account of small and medium-sized enterprises (SME s). The study will also examine changes within Swedish and international markets for goods and services. Specific issues to be covered include:

  • whether any possible changes to regulations should take place through legislation or collective agreements, and how such changes would influence new SMEs;
  • new complexities in the relationship between the employer and the employee;
  • the increasing number of fixed-term employees during the 1990s, and the possible consequences of this development;
  • the consequences of decreasing differences in job security and employment conditions between permanent jobs and fixed-term jobs;
  • how the security and predictability required by the Act on Employment Protection (anställningsskyddslagen) can continue to be provided, and the effects for enterprises;
  • clarifying and developing the mutual rights and duties of the employer and employee under the employment contract;
  • whether the existence and use of unfair competition and secrecy clauses in employment contracts could be restraining growth through limiting flexibility on the labour market; and
  • whether the legal distinction between notice of dismissal on grounds of a shortage of work and on grounds of "personal reasons" is adequate or not under today's changed circumstances.
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