Collective Bargaining Agreements In Sweden

National agreements on wages and general conditions of employment are mainly negotiated centrally in Sweden. There are more than 100 national organizations – about sixty trade unions and about fifty employers` organizations – which work each year to deal with more than 650 collective agreements affecting more than 3.5 million workers. During the term of the contract, both parties are obliged to ensure the peaceful maintenance of employment relations. In international comparison, the Swedish labour market has been the subject of only a few disputes in the past, both over proposed and effective labour dispute measures and lost working days. State mediation in labour disputes has been provided for by law since 1906. But in 1980, two of the country`s main social partners were involved in a lockout and strike situation. Subsequently, considerable efforts were made to avoid a similar situation and, in 2000, a central governmental authority, the National Mediation Office (NMO), was established. Each national collective agreement then sets a basic level to which employers in their sector are required to increase wages in general by 2.2%, for example. National collective agreements can be renegotiated later on the spot, but they must not lead to worse results for workers.

If local negotiations fail, the “Stupstock” comes into force, i.e. participants resort to nationally agreed wage increases. Another important concept is the “lönepott” or pay pot. The wage pot is calculated by adding up an employer`s total salary and payroll and multiplying it by the nationally agreed wage increase. This means that all employees will receive a minimum rate. So, imagine that company A has 12 employees and that its salaries total 360,000 €. According to the negotiated collective agreement, Company A must offer them a salary increase of 2.2%. His pay pot is E360,000 x 2.2% = 7,920 €.

If a salary increase of € 50 is guaranteed to each employee, about € 600 for a total of € 7,920. The employer will thus receive € 7,920 – € 600 = € 7,320 for the distribution at will. But each sector has a different starting point for its wage policy, depending on the compromises made during the collective bargaining process. . . .