Swedish talks on labour reform collapses, political crisis looms

The Swedish Trade Union Confederation (LO), the Federation of Salaried Employees in Industry and Service (PTK) and the Confederation of Swedish Enterprise last week failed to reach an agreement on Sweden’s law on employment protection (LAS), shelving the idea of a better employment agreement between the parties.

LO Chairperson Susanna Gideonsson lamented the parties’ failure to reach an agreement, saying the negotiations were “tough, but constructive.” She said that LO's main goal in the negotiations was to eliminate the general fixed-term employment and planning, and increase job security for hired employees.

Trade unions expressed concerns that the parties’ failure to reach an agreement will jumpstart the government’s plan to amend LAS based the proposals presented by state investigator Gudmund Toijer last spring. They said that the proposals heavily favour employers as they seek to allow companies to deviate from the “last in, first out” principle, permitting them to randomly dismiss up to 5 workers (from the current maximum of two). Age will also not be considered on dismissals, leaving senior workers vulnerable to termination. Trade unionists said that they may lose their power to stop dismissals. 

It was reported that the Confederation of Swedish Enterprise is seeking to exempt five workers and five white-collar workers from the "last in - first out" rule and more exemptions to larger companies to allegedly simplify dismissals of workers based on negligence and poor performance. 

With the collapse of the negotiations, several unions will now push for more secure jobs in their collective bargaining movement. However, this may not not apply to the LO unions in the industry, as the industry agreement states that no new demands may be added to the demands that have already been made before the collective agreements were extended last spring.

Trade unions said that the lack of common agreement on LAS could possibly trigger a political crisis, with the Left Party vowing to put forward a vote of no confidence in parliament if the ruling social democrats, who’s trying to keep the peace with their centre and liberal partners, will press ahead with changes in LAS.