Employment termination in
Sweden.

Q: Is it difficult to terminate employment in Sweden?

Terminating employment in Sweden is considered difficult . To mitigate the risk of a mis-hiring, it is advised that employers offer employment through a fixed-term contract; fixed-term contracts usually end after 2 years, and give the employer (and employee) an opportunity to choose whether to extend for another 2 years. Note that while there is no state-madated severance pay in Sweden, there may be severance pay required by the employment contract or collective bargaining agreement. In cases of termination, it may be in the company’s best interest to pay severance regardless of what the laws and practices are in the hiring location.

SALARY PAYMENT IN Swedish Krona (SEK, kr)

CONTRACT LANGUAGES Swedish / English

PAYROLL TAX 31.42%

PAYROLL CYCLE Monthly

TIME TO HIRE 24 hours
Get Started

The Horizons PEO solution allows you to hire in Sweden, without setting up a costly subsidiary.

Horizons has the most fair price point for Sweden PEO on the market with zero hidden fees. Contact us for a cost breakdown

With extensive experience in the Swedish hiring market, Horizons can hire new employees in as little as 24 hours.

Horizons' HR management platform was built to easily manage Sweden & international teams, based on client feedback at each step of development.

Hire and pay talents
with Horizons in
180+ countries

Get started

[hiring_sidebar]

Valid reasons to terminate employment in Sweden

There are various reasons for terminating employment in Sweden. Valid reasons for dismissal are:

Objective reasons/reasonable grounds – Relating to personal reasons such as lack of competence, misconduct, co-operation problems, harassment, refusal to work, criminal offenses, and so on. There must be no possibility of placing an employee in another role.
Shortage of work

Unfair reasons to terminate employment in Sweden

Unfair reasons for terminating employment in Sweden are classed as anything that lacks an ‘objective reason’. For example, termination due to sickness, old age, race, gender, and so on would be classed as unfair dismissal.

Dismissal procedure in Sweden

There is a specific procedure that most employers must follow when dismissing employees in Sweden:

Notice letter sent via courier including signature upon receipt
- The notice letter must specify how the employee may contest the termination
- The notice letter is sent to the employee and the trade union if the employee is a union member
Payment of (where applicable) unused accrued leave, bonus, payment in lieu of notice, and severance

Resignation procedure in Sweden

Resignation does not require a reason, but employees must provide the appropriate notice according to the law:

In probation period → min. 14 days
0 to 2 years employment → min. 1 month
2 to 4 years employment → min. 2 months
4 to 6 years employment → min. 3 months
6 to 8 years employment → min. 4 months
8 to 10 years employment → min. 5 months
above 10 years employment → min. 6 months
OR: Immediate termination = Payment in-lieu of notice

Hiring in Sweden, Made Easy

Your business can easily hire employees in Sweden without opening a local entity.

We handle local employment law, complex tax regulations, and international payroll in 185 countries worldwide. All you need to do is focus on your business.

FAQs

Is it difficult to terminate employment in Sweden?

Terminating employment in Sweden is considered difficult. To mitigate the risk of a mis-hiring, it is advised that employers offer employment through a fixed-term contract; fixed-term contracts usually end after 2 years, and give the employer (and employee) an opportunity to choose whether to extend for another 2 years.

Note that while there is no state-madated severance pay in Sweden, there may be severance pay required by the employment contract or collective bargaining agreement. In cases of termination, it may be in the company’s best interest to pay severance regardless of what the laws and practices are in the hiring location.

What are the risks of terminating employment in Sweden, and how do I mitigate them?

Terminating employment in Sweden comes with risks, just like anywhere else. The risks of terminating employment in Sweden include the following, if the termination is found to be unlawful:

Employee may be entitled to continued salary payments while the case is in-process with the labor bureau
Employee may be entitled to additional compensation, including for financial loss and non-material injuries suffered
Employee may be entitled to “redistribution” i.e. to have their job reinstated or to be offered another role at the company.

Your best chance of mitigating employment termination is to work with a local expert on employment law, such as a professional employer organization (PEO), employer of record (EOR), or a local Swedish law firm specializing in employment law, before the termination procedure begins. If you hired your employee through a partner, they should be able to advise you on best practices in Sweden or your other countries of hire.

Success stories from businesses we’ve helped enter and grow in new markets.

Client Testimonials

"As a seed-stage, London-based startup, we were initially hesitant to expand internationally due to the administrative workload involved. Horizons took the headache out of the process, allowing us to hire a team of software engineers in Germany."

Gabor SzedlakCo-founder & COO at MindLabs (UK)

"I truly appreciated the thoroughness and the professionalism of Horizons personnel while we hired internationally with them. They were knowledgable on all subject matters pertaining to international employment."

Gary PaskyVP Software Development, PICS ITech (USA)

"On deciding to begin commercial activities in Asia Pacific, we needed a provider to handle the employment and remuneration of our workforce. With Horizons the result was fast, efficient, and fit-for-purpose. We recommend Horizons as an EOR provider.”

Chris MorrellManaging Director, Schaeffler Group (Germany)

"The collaboration with the Horizons team is excellent. Both our local employee as well as our HQ in Germany are more than pleased with the support provided and the simplicity of the service. We can highly recommend the Horizons solution to anyone."

Christoph EngelbertCo-Founder & CTO, Clevabit (Germany)

"We needed an EOR that could provide expert support for payroll in APAC. We are pleased with Horizons’ expertise and the fact that they are flexible, responsive, and easily accessible from Belgium. They were able to provide services within the short timeline we required."

Katia FlamandHuman Resources, Devian Chemicals (Belgium)