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The Swedish Model

Learn about the foundation of the Swedish job market where collective agreements regulates most terms and conditions in your employment.

What Does the Swedish Model Entail?

In most countries, the job market is regulated only by legislation. In Sweden, the labour market is regulated both by laws, which provide the minimum level for the working conditions, and by collective agreements that supplement with more and better conditions. It is the trade unions and the employers who jointly agree on the content of the collective agreement that regulates, for example, terms and conditions, working hours, and wages.

This means we get a flexible job market with the possibility to tailor certain conditions to different industries, companies, and individuals, all without involving politicians. This model has worked incredibly well over the past twenty years, in large part because employers and unions solve the important issues themselves.

While other countries experience difficulty reaching real wage growth, Swedish workers increased theirs by sixty percent in the same period. Sweden also experiences one of the lowest number of strike days and conflicts.

The Swedish model is built on a foundation of strong unions. Therefore, it is important that you are a member so that we can continue to develop safe workplaces where you and everyone else thrive and want to contribute.

What is a Collective Agreement?

Collective agreements are usually time-limited. When these agreements expire, the parties renegotiate the terms in a bargaining process. Unlike a legislative process, parties can act more swiftly and flexibly, thereby adjusting conditions based on the sector, industry, or workplace.

A collective agreement applies to everyone working within a sector or workplace covered by the agreement. It sets norms, meaning it must be applied even to individuals not affiliated with a union, thus functioning as a minimum standard for the conditions (unless explicitly excluded in the agreement). Therefore, the collective agreement applies to everyone at the workplace, whether they are members of a union or not.

For the Swedish Model to function effectively, many employees at a workplace need to be part of a trade union. If the union membership rate is low, it becomes challenging for unions to assert representation for employees at the workplace, diminishing their bargaining power and legitimacy.

What is Saco, TCO, and LO?

Saco stands for the Swedish Confederation of Professional Associations and is one of three trade union confederations in Sweden. The organisation is one of three central unions in Sweden. The other two are LO (the Swedish Trade Union Confederation), which brings together unions for workers such as Kommunal and IF Metall. The third is TCO, which represents trade unions for professionals based on sector, such as Unionen and Vision.

Saco consists of 21 trade unions, of which Akavia is the third largest. Together, Saco unions represent 700,000 academics, all of whom strive for better working conditions and employment security systems for Swedish academics.

Saco influences public debate through enquiries and by providing facts for debate articles and editorials. It also presents and discusses political proposals at seminars and in meetings with decision-makers, in consultation responses, and in other contexts where there is an opportunity to influence legislation and other important decisions.

Centrally, Saco’s work is primarily to promote the interests of academic graduates in social policy-related issues. The Saco unions work with issues relating to pay, equality, inclusion, work-life security, and other employment conditions, as well as with members’ professional and educational interests.

The Swedish Model in 60 seconds

The Swedish Model – A Piece of Cake

The terms and conditions for the Swedish labour market can be likened to a cake – with great possibilities of various flavours and combinations. The various elements regulating the conditions for employees in the Swedish labour market – legislation, central and local collective agreements, and individual agreements – can be compared to different levels and layers of a cake. For each element you add to your cake, the working conditions are improved and shaped through needs that depend on your working segment, company, or organisation and you as an individual. As a member of a trade union, you can influence which type of cake your workplace will have. You can usually choose the decorations for your slice. The ability to tailor the cake to specific occasions and needs is what makes the Swedish Model so unique and successful.

The Model in Detail

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Collective Agreements in Sweden

Explore what collective agreements entail in Sweden and what effects it has on the job market – both for employees and employers.

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