Employer Record in Sweden

Basic information

Capital: Bern

Time zone: GMT+1

Languages: German, French, Italian and Romansh

Currency code: CHF

Human Resources at a Glance 

Contract Terms

  Contracts must be in writing and signed by both parties.

  A contract must include:

  • Name
  • Start date
  • Length of the employment
  • Job description
  • Salary
  • Termination conditions
  • Benefits insurance

Guidelines Regarding Probation Period/Trial Period

Probation periods are mandatory for indefinite term contracts. The maximum probation period is 90 days (3 months).

Regulations and Rules Regarding Working Hours

Standard working hours are 8 hours per day, 40 hours per week. The standard workweek is from Monday to Friday. The standard workweek can vary from 38.5 to 42.5 hours.

Overtime payment is not mandatory and may be included in the salary, depending on what’s agreed in the employment contract. Employees can work a maximum of 45-50 hours of overtime. For additional hours, employees can be paid:

  • 125% of the hourly rate, up to 45 hours per week for industrial sector employees, office workers, technical employees, and sales staff.
  • 125% of the hourly rate, up to 50 hours per week for other sectors.

Minimum Wage Requirements

In Switzerland, there is no national minimum wage by law. However, the minimum wage for a fulltime employee established by the Collective Bargaining Agreement is CHF 59,296.12 gross a year. Some cantons apply minimum hourly wages:

  • Canton of Neuchâtel – CHF 20.77
  • Canton of Jura – CHF 20.60
  • Canton of Geneva – CHF 24
  • Canton of Ticino – CHF 19
  • Canton of Basel Stadt – CHF 21

Termination 

Grounds

Terminations in Switzerland can be complex and depend on the contract terms and what’s agreed on between the parties.

  Compliant terminations include:

  • Voluntarily by the employee
  • By mutual agreement
  • Unilaterally by the employer based on:
    • Probation period
    • Objective grounds
    • Disciplinary dismissal
    • Performance of the employee
  • By the expiration of the contract

  Uncompliant terminations include:

  • Fixed-term employment contracts before the end date.
  • Termination while the employee is ill or had an accident, they will be protected according to the length of the service:
    • 30 days during the first year of service
    • 90 days from the second to the fifth year
    • 180 days from the sixth year

The employer must wait until the employee returns to work before leaving in all these cases. However, the employee can terminate their contract during the protection period.

Notice Period

  The minimum notice period is 30 days and will be increased according to the length of the employment.

  • 30 days if the length of service is one year
  • 60 days if the length of service is between the second and the ninth year
  • 90 days if the length of service is more than ten years.

  During the probation, the notice is seven calendar days.

Severance Pay

There are no statutory provisions in Sweden regarding severance pay. However, an employee may be entitled to severance pay in accordance with an employment agreement, a collective bargaining agreement or a separation agreement.
At least in midsize to large companies, it is standard practice to include a severance payment on top of the notice period for a managing director (who would typically not be covered by employment protection) in the employment agreement. This normally corresponds to six to 12 months’ fixed salary.
In a specific termination situation, it is common that the employer pays a severance payment in addition to notice in a settlement agreement. This applies especially if it is unclear whether “just cause” for termination exists or if there are other issues (e.g. failure to comply with the “last in, first out” rule.

Payment & leave Compensation & Holidays 

SalaryPayment

Salaries are usually paid into a bank account at the end of the month. Employers have an obligation to deduct tax at source. This tax includes all social insurance contributions except unemployment insurance contributions.

Payslip 

Employees are entitled to receive a written salary specification showing their salary and the deductions made. Employers must also provide an annual income statement (‘kontrolluppgift’) to the employee and to the Swedish Tax Agency.

Annual Leave

Employees under the age of 20 or over the age of 50 are entitled to 25 days of vacation a year as established by the Collective Bargaining Agreement.

Sick Leave

Employees are entitled to paid sick leave for up to 730 days in a 900 day period. Sick leave in Switzerland is managed in 2 ways. The employer has sickness daily benefit insurance: 0-30 days: paid at 100% of the employee’s regular salary by the employer 31-730 days: paid at 100% of their regular salary, 80% by insurance and 20% by the employer.

The employer does not have sickness daily benefit insurance: Paid at 100% of the employee’s regular salary, with limits on sick leave entitlement depending on how long the employee has been working at the company. 1st year of employment: 3 weeks 2nd year of employment: 1 month 3rd and 4th year of employment: 2 months 5th – 9th year of employment: 3 months 10+ years of employmentL 4 months

Maternity & Parental Leave

Pregnant employees who have worked for 270 consecutive days are entitled to 14 weeks (16 weeks in the Canton of Geneva) of paid leave. Eight weeks must be taken after the child’s birth. The employee will receive 80% of the salary during this period, capped at CHF 196 per day, and Social Security will be responsible for this pay. The employee can extend leave additional 14 days unpaid.

In Switzerland, no law covers parental leave. However, employees may be entitled to maternity leave and paternity leave.

Tax and Social Security Information

Personal Income Tax

The individual income tax ranges from 1% to 24%. Income tax is calculated according to progressive rates, location (canton) of the employee. Multiple additional factors may impact overall rates such as the household status and the number of children.

Social security

Sweden has one of the most highly developed welfare systems in the world. Employers deduct social insurance contributions from employee wages on a monthly basis and remit them to the Swedish Tax Agency using the pay-as-you-earn (PAYE) system.

Employee Social Security Contributions – Employees must make a 7% contribution towards the public social security system with a cap at an annual income of SEK 538,700 (maximum contribution SEK 37,700).

Insurance Employer Contribution (%) Employee Contribution (%) Cap (CHF) 
Old age, Survivors’ and Disability insurance5.35.3No cap
Unemployment Insurance1.11.1148,200
Family Compensation Fund0.420.0No cap
Occupational Accident Insurance0.730.0148,200
Non-occupational Accident Insurance0.00.1146148,200
Occupational Pension SchemeDepending on pension plan, employer specificDepending on pension plan, employer specific
Medical InsuranceDepending on coverage, private insurance
Daily Benefits insurance illness (IJM)0.9080.0300,000

Public Holidays 2024

OccasionDate
New Year’s Day1.1
Good Friday3.29
Easter Monday4.1
Ascension Day5.9
Whit Monday5.2
National Day8.1
Christmas Day12.25


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