Sweden
A gem of Northern Europe, Sweden is home to some great remote talent. If you’ve found someone in Sweden you’d like to hire, you’re in the right place. In the next few minutes, we’ll teach you how you can hire in Sweden (without getting tied up in legal red tape and thousands in fees).
Country snapshot
CURRENCY
Swedish Krona (SEK)
EMPLOYER TAXES
31.42%
PAYROLL FREQUENCY
Monthly
OFFICIAL LANGUAGE
Swedish
It’s the fastest way to hire globally
Hiring employees takes months, at the minimum. When you hire with Thera's locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.
It’s a lot cheaper
It costs just $0 to sign up for Thera, then $25 per month to hire your contractors with Thera. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.
It’s more flexible for you & your team
Can be less risky than hiring employees
Hiring employees is a bigger commitment, and can open you up to increased liabilities and regulations. When you hire contractors overseas, your biggest risk is misclassification—but laws surrounding contractor classification are often significantly more straightforward.
Some people want to be employees
The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.
You might not have as much control over your talent
Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.
So you want to hire in Sweden. That’s great. But you should know that hiring in Sweden is different from hiring in your home country. There’s a whole laundry list of labor laws to catch up on, lawyers to contract, compliance issues to navigate… And it can get complex. So we’ll break it down in simple terms.
Hire talent as contractors
Hire talent as employees
If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in Sweden than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in Sweden.
Employer tax
Health Insurance
Parental Insurance
Retirement Pension
Survivors Pension
Labor Market Fee
Occupational Injury
General Payroll Tax
Individual tax
Up to 519,400 SEK - 0%
Above 519,400 SEK -20%
Paid Time Off (PTO)
Employees are entitled to 25 days of paid vacation each year after one year of work at the company. Once accrued, vacation days can be held for up to five years.
Vacation pay accounts for 12% of an employee's gross annual salary.
Public Holidays
There are 13 public holidays in Sweden.
Sick Days
An employer is responsible for paying 80% of an employee’s salary for the first 14 days of sick leave.
After 14 days employers report to the Swedish Social Insurance Office, and the employee applies for the benefits. Social insurance pays for sick leave starting on day fifteen.
Maternity Leave
Mothers receive 240 days of paid leave with the right to start 60 days before the expected birth.
Paternity Leave
Fathers are entitled to 240 days of paid leave.
Parental Leave
Swedish parents are entitled to 480 days of paid parental leave with each parent having an exclusive right to 90 of those days. Leave shouldn’t be taken at the same time, except for the first 10 days following the birth. Single parents are given the full 480 days.
Bereavement Leave
10 days
Termination Process
The employer must have a valid reason to terminate an employee.
Before termination, an employer must try to find the employee a different role in the company before terminating the employee.
For companies with more than five employees, employers are obligated to notify the Employment Service. Companies are also obligated to negotiate with trade unions if relevant.
After negotiations, the employer must provide a termination notice in writing and in person. If this is not possible then a registered letter may be sent to the employee’s address.
Notice Period
Notice periods in Sweden are determined by employment contracts, collective agreements, or by the Employment Protection Act.
Employers:
With a collective agreement – Notice periods should be agreed upon between employer and employee and stated in the employment contract. The most common notice period is one month.
Without a collective agreement –
- Less than 2 years – 1 month
- 2 years but less than 4 years -2 months
- 4 years but less than 6 years – 3 months
- 6 years but less than 8 years – 4 months
- 8 years but less than 10 years – 5 months
- 10 years or more – 6 months
Employers may dismiss employees without notice if they have grossly misbehaved.
Employees:
With a collective agreement – Notice periods should be agreed upon between employer and employee and stated in the employment contract. The most common notice period is one month.
Without a collective agreement – According to the Employment Protection act notice period is one month.
Severance Pay
Companies have no obligation to pay any severance pay but it may be included in an employment agreement.
Working Hours
Full time employment is considered 40 hours weekly. Workers are entitled a break after 5 consecutive hours of work, and an 11 hour break for every 24 hour period.
Overtime
Overtime should not exceed 48 hours over a four-week period, 50 hours per month, or 200 annual hours. Overtime rules should be in a collective agreement or employee contract, and typically compensated with pay or leave. For overtime worked before 8pm on weekdays, overtime allowance is the monthly salary divided into 94 for each hour. For overtime worked after 8pm or weekends, allowance is the monthly salary divided into 72 for each hour. Employees who are excluded from overtime pay include, employees who hold managerial or comparable positions, those who organize their own working time.
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