New temporary unemployment insurance rules adopted

In adopting new temporary unemployment insurance rules, the government has responded to trade union criticism regarding the increase in membership fees to the unemployment insurance funds and the reduction in unemployment benefit payments in 2006 and 2007. The government has now reduced the membership fees and made it easier for people to receive unemployment benefits. However, the trade unions consider that the changes are insufficient.

The Swedish government has once again changed the rules in terms of unemployment insurance (SE0702029I). The government decision to amend the rules governing the unemployment insurance system is partly due to the global economic crisis, which has caused a significant increase in the unemployment rate in Sweden. In July 2009, according to Eurostat, some 9.2% of the economically active population in Sweden and 27.3% of young people under the age of 25 years were unemployed. The current amendments to the unemployment insurance system are also related to the fact that about 450,000 people have left the unemployment insurance funds in the past few years, due to increased monthly membership fees and reduced amounts of benefit payments in 2006 and 2007 (SE0807019I).

The Swedish parliament decided in the spring of 2009 that the government proposal (in Swedish, 632Kb PDF) for new rules in relation to membership fees and qualification criteria for receipt of unemployment insurance benefits should enter into force on 1 July 2009. The changes, however, are only temporary and will be valid until 31 December 2009. They relate to the following aspects:

  • the membership fee is reduced by SEK 50 (€4.86 as at 5 September 2009) a month;
  • up until now, a worker had to be a member of the unemployment fund for more than 12 months to be entitled to unemployment benefits – this waiting period has now been reduced to six months;
  • the requirements for a minimum amount of working time in the year preceding unemployment in order to receive benefits have also been abolished;
  • a member of an unemployment fund can lodge an appeal to the administrative court against a fund’s decision on whether or not they are entitled to benefits.

This initiative is a way for the government to respond to the heavy criticism that it has received from the trade unions in relation to the unemployment insurance system in recent years.

Social partner reactions

Over the past year, the trade unions have been actively calling for reform and changes to the regulation of the unemployment insurance system.

Trade unions criticise membership fees

The main issue that the trade unions have been criticising relates to the membership fees of the different unemployment insurance funds, which were calculated on the basis of the number of unemployed people in 2006. The trade unions believe that this system of determining the membership fees is unjust and discriminates against the funds’ members. For instance, the economic sectors that are affected by high unemployment have greater membership fees. Several unemployment funds have had or will have to raise the membership fees in the autumn of 2009, due to high unemployment.

The Union of Metalworkers (IF Metall) states that the reduction in membership fees of SEK 50 (€4.86) a month is too small to have any effect in the manufacturing sector, which has been severely hit by the global economic crisis and which has seen a significant increase in the number of unemployed people. Some unemployment funds are obliged to increase the membership fees due to the high unemployment rate in certain economic sectors; therefore, the effect of the reduction will not be noticeable for members in these unemployment funds.

According to an article in the financial daily newspaper Dagens Industri on 17 July 2009, most trade unions consider that membership fees should be the same, regardless of the unemployment fund of which a worker is a member.

Campaign for increased unemployment benefits

The trade unions – namely, the Swedish Trade Union Confederation (Landsorganisationen i Sverige, LO), the Swedish Confederation of Professional Associations (Sveriges Akademikers Centralorganisation, SACO) and the Swedish Confederation of Professional Employees (Tjänstemännens Centralorganisation, TCO) – have launched a campaign with the goal of raising the ceiling of unemployment benefit payments, which they think is too low. The campaign consists of collecting names from Swedish citizens and presenting this list to the government with a request for raising the ceiling of unemployment benefit payments. More than 100,000 signatures have been collected in the campaign so far.

The trade unions point out that the ceiling for calculating unemployment benefits has not been adjusted since 2002 and is still at SEK 18,700 (€1,819) a month. The unions argue that 75% of the workforce who are members of an unemployment insurance fund are underinsured and only receive benefits amounting to half of their salary in the event of unemployment. The trade unions jointly demand that the unemployment funds should pay at least 80% of the members 80% of their last salary – a level that the trade unions consider decent, according to an article in Dagens Industri on 2 July 2009.

TCO has made a great effort during the year to influence the government to reform the unemployment funds. The trade union confederation claims that the government has to do much more in order to improve the unemployment funds, according to a press release on 12 May 2009.

Employer organisation critical of government decision

The Confederation of Swedish Enterprise (Svenskt Näringsliv) is critical of the government decision to reduce the membership fees of the unemployment insurance funds. The employer organisation believes that the current ceiling for unemployment insurance fund membership fees at SEK 300 (€29) should be abolished.

Karolin Lovén, Oxford Research

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