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WORKING IN SWEDEN

Why you get paid MORE when you take time off in Sweden

Workers in Sweden enjoy relatively generous rights, especially when it comes to holiday. In fact, you actually get paid a bonus for not being at work.

Why you get paid MORE when you take time off in Sweden
It sounds too good to be true, but in Sweden you often get paid a (small) bonus when you go on vacation. Photo: Kristin Lidell/imagebank.sweden.se

OK, it’s not quite that simple. But most employees of Swedish companies receive an extra so-called ‘holiday supplement’ or ‘holiday salary’ when they take their annual leave.

Workplaces in Sweden must offer employees a minimum of 25 days’ paid annual leave, while many companies offer more, particularly for long-term employees. Each tax year, a minimum of 20 of those days must be taken as holiday, and employees can roll over the remainder (in other words, up to five days if they have the standard 25 days’ holiday, plus any extra days their workplace gives them).

This is paid vacation, so employees are paid their normal salary for those days, and they also get a small additional bonus.

This little extra, called holiday salary or semesterlön or semestertillägg, is calculated as a percentage of your monthly salary.

Depending on your employment contract, this might be paid out in a lump sum once a year or added on to your monthly payslip, usually the month after you take the holiday.

As for the why, there’s a historical reason and an economic reason. 

The semesterlön was first introduced for workers on a variable salary, such as hourly workers or workers on commission. A semesterlön of 12 percent their total annual salary was introduced for this category of employees to ensure that people on atypical contracts were still able to take vacation from work. This is generally paid annually for people with variable salaries.

In 2010, Sweden’s Annual Leave Act was updated and this included a provision for holiday pay for workers on fixed salaries so that they would not be disadvantaged.

For workers on a fixed monthly salary, by law the semestertillägg is 0.43 percent of the total monthly salary per holiday day, and this is typically paid the month after the leave was taken.

But many collective bargaining agreements stipulate that it should be a higher percentage of the total monthly salary, so if your workplace has such an agreement (called kollektivavtal in Swedish) it is these rules that apply. The way that Swedish laws on working conditions and holiday work means that collective bargaining agreements can override the law only if they offer conditions that are more advantageous for the employee.

By this point, holiday pay has become convention. It encourages employees to actually take their holiday, because there’s a financial incentive to do so. It is possible to cash in some of your unused holiday at the end of your employment, in which case you get a lump sum of semesterersättning (literally ‘holiday compensation’) which is equal to your pay for that day plus the semesterlön or semestertillägg

And of course, it may boost employee morale if they’re receiving a little extra spending money to use on their break from work.

As a worker in Sweden, the important thing is that you’re aware of your rights and that you make extra sure to check your payslip after taking your accrued holiday.

READ MORE: Everything you need to know about annual leave in Sweden

Why do Swedes take such long summer holidays? Find out in this episode of The Local’s Sweden in Focus podcast from 2021:

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WORKING IN SWEDEN

‘Hard to know your rights’: three quarters of foreigners in Sweden afraid of losing job

With Sweden's economy likely to dip into recession next year, more than three-quarters of respondents to a survey by The Local have said they are "slightly" or "extremely" worried about losing their jobs.

'Hard to know your rights': three quarters of foreigners in Sweden afraid of losing job

Out of 53 respondents to our (highly unscientific) survey, 28 said they were “slightly worried” about losing their job and 13 “extremely worried”, with the remaining twelve saying they were not worried at all. 

Most of the foreign workers who weren’t worried either work in industries or companies expected to weather any downturn or have skills, such as IT programming, of which there is a shortage in Sweden. 

“I work in an area of IT that helps businesses reduce costs, so I expect my employer to be busier,” wrote Geoff, who lives in Stockholm. “I keep myself updated with the latest trending technologies,” added Sachin, who like Geoff works in IT. 

“My skills are needed in both Sweden and all over the world, and the company I work for can use my skills on those contracts,” said one American software engineer. 

Those who were more worried mainly worked in other fields.

One employee for a Swedish religious aid organisation said that a tenth of the staff had recently been made redundant, with a further 25 percent resigning in protest, and that he, as a result, now felt his position was insecure.  

READ ALSO: How will Sweden’s Employment Act reform impact foreigners?

What measures have people taken to make their financial positions more secure? 

There was a clear division among the survey’s respondents between those who have permanent residency, Swedish citizenship, or EU citizenship, and those who are employed in Sweden on a two-year work permit. 

“I am still waiting for my permanent residence permit,” said one. “There is a rule that requires you to be a permanent employee both at the time you apply and when the Migration Agency makes a decision. Current processing times are around six months and this creates a lot of uncertainties. If you lose your job while waiting for a decision, you will lose your right to permanent residence and it’s not clear how much time you will have to find a new job.” 

Although many of those on work permits were still members of an a-kassa, Sweden’s heavily subsidised unemployment insurance organisations, they said that they feared they would not receive the full benefits if they were made unemployed, as they risked being forced to leave Sweden. 

“If you are a permanent resident or citizen, the employee benefits from a-kassa and unemployment insurance is quite good,” one wrote. “But this doesn’t apply if you are on a temporary work permit. In that case, you will still have to leave the country in three months if you can’t find a new job and I am not sure if you can continue receiving unemployment benefits once your work permit expires.” 

A few respondents said that they had taken out additional insurance on top of their a-kassa membership, so they would replace their full salary if made redundant, while others said that they had joined the union in their workplace. 

However, a significant number of the respondents said they were relying mainly on their own private protection, with several saying they had reduced their spending to build up a cash buffer, others saying they had built up an investment portfolio. 

In addition, many said they constantly sought to improve their value as an employee through in-work skills training, working hard and making themselves indispensable. 

How did respondents rate the employment protection in Sweden? 

In general, respondents rated the system of employment protection in Sweden quite highly, with the 53 respondents rating it at seven out of ten, on a scale from “poor” to “excellent”. 

Source: Typeform/The Local

Strong employee rights and a fairly equal health system are important elements of Sweden’s system,” wrote one respondent approvingly, while another said it was a comfort to know that “there is a process that is more or less in your favour”. 

Several respondents added, however, that the system was confusing and difficult to navigate for foreigners. 

“Coming from a country where employment laws are written to protect the employer, it’s hard to know all of your rights in Sweden, said one, while another said the employment protection laws were “hard to navigate as an immigrant”. 

Some questioned how useful Sweden’s unions were when employers were abusing the system, with the charity employee saying he was “not impressed with the Swedish union model” on the basis of his experience. 

“The effectiveness of the union depends too much on inexperienced, ineffective local staff, and unions do not have real teeth they can use in a case where an employer just ignores them,” he argued.

“As strange as it sounds, an employer that is not negotiating in good faith can just ignore and exhaust union demands and complaints. The union is reluctant to take things beyond sending written complaints to the employer. Even in cases where age discrimination occurs, the penalties are so small that claims are not worth pursuing.” 

Are foreigners planning on taking advantage of the new opportunities for retraining? 

Under new employment reforms which came into force in October, employees in Sweden are entitled to special loans for retraining courses, called omställningsstudiestödet. All employees can from this month apply for a loan for courses starting in January.

Nearly 70 percent of respondents said they would be interested in taking advantage of the new scheme. 

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