Hire in Sweden

Sweden PEO &

Employer of Record

Hire & manage teams remotely in Sweden without a local entity. We handle HR compliance, payroll & taxes so you can focus on your business.

Business Language

Swedish, English

Salary Currency

Swedish Krona (SEK)

Capital city

Stockholm

Time zone

UTC +2

EOR in Sweden

Hire Employees in Sweden

NNRoad provides professional employment organization (PEO) & employer of record (EOR) services in Sweden to ensure that your business complies with local labor laws and regulations. We process monthly payroll and act as the Employer of Record, taking on all local employer liabilities.

Fast Hiring

Start working with your remote employees in a week.

Foreigner Visas

NNRoad assists with overseas foreign hires visa needs.

Platform

Access your payroll reports on our portal.

Employer of Record in Sweden

Employer of Record (EOR) services are for companies who do not have a legal entity in Sweden, but who want to hire localy. Employment and full liability are outsourced to NNRoad.

1. Candidate Selection

Select the candidates you want to hire in Sweden.

2. Employee Onboarding

We sign a local labor contract with your employees based in Sweden.

3. Compliance & Payroll

We manage monthly payroll, mandatory benefits & all HR compliance in Sweden.

EOR service includes:

Hiring and termination of employees/local labor contracts (contract administration – engagement, extension termination and conversion to permanent hire).

All mandatory employer (and employee) contributions filed and paid for your EOR employees.

Payroll recording, reporting and administration.

Distribution of salaries to employees through direct deposit into their bank accounts.

Calculation, reporting, filing and processing of EOR employee’s individual income tax due.

Collecting and processing your employee’s invoices for business related expenses.

Guiding and organizing your expat employee’s work visa application too guarantee their successful onboarding.

Standalone Payroll & PEO in Sweden

Professional Employment Organization (PEO) services are for companies who have a legal entity in Sweden, and want to outsource their payroll. Employment liabilities are shared between your organization and NNRoad.
sweden employee benefits

Employee Income Taxes:

Individual income tax rates in Sweden are based on progressive tax brackets.

The tax rate ranges from 32% to 57%, depending on the level of income, with an additional municipal tax that varies by location. Sweden also has a generous social welfare system, which is partly funded by tax revenue.

As such, individuals can benefit from various public services, including healthcare, education, and parental leave. However, it is important to note that Sweden has a complex tax system, with various deductions and exemptions that individuals need to be aware of. It is advisable for individuals to seek the guidance of a tax expert to ensure compliance with Swedish tax laws.

Tax Brackets:

Sample Calculation

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Individual income taxes in Sweden are among the highest in the world, with a progressive tax system that aims to promote income equality. The tax rate ranges from 32% to 57%, depending on the level of income, with an additional municipal tax that varies by location. Sweden also has a generous social welfare system, which is partly funded by tax revenue.

As such, individuals can benefit from various public services, including healthcare, education, and parental leave. However, it is important to note that Sweden has a complex tax system, with various deductions and exemptions that individuals need to be aware of. It is advisable for individuals to seek the guidance of a tax expert to ensure compliance with Swedish tax laws.

Employer Contribution

Payroll contribution: 11.62%
Retirement pension: 10.21%
Health insurance: 3.55%
Unemployment insurance: 2.64%
Parental insurance: 2.60%
Survivor’s pension: 0.60%
Occupational injury insurance: 0.20%

Total costs: 31.42%

Employee Contribution

Pension insurance: 7%

Total cost: 7%

Mandatory BenefitsPension Fund

Mandatory contributions in Sweden refer to the payments that every citizen or resident must make towards the country’s social security system. These contributions are deducted from an individual’s salary or income and are used to fund programs such as healthcare, pensions, and unemployment benefits. The Swedish social security system is known for providing a comprehensive safety net to its citizens, and mandatory contributions play a crucial role in financing it.

The amount of contribution is based on a percentage of an individual’s gross income, and the rates vary depending on the type of benefits covered. The Swedish government also provides additional support to low-income earners to ensure that mandatory contributions do not become a financial burden.

Employees are required to make a 7% contribution to social security, this contribution is included in income tax and is deducted by the employer at source together with preliminary income tax.

Employees do not need to pay general pension fees on the part of their income that exceeds SEK 501,000 (2020).

All employers in Sweden pay statutory social security contributions on behalf of their employees, consisting of charges for pensions, health insurance and other social benefits. These contributions amount to 31.42 per cent of gross salary. For employees between 15 and 18 years of age the contribution is reduced to 10.21%. Employer contributions come on top salary costs and are payable for any employee or contractor who has earned SEK 1,000 or more during the year.

Working hours and overtime laws in Sweden are designed to promote work-life balance and ensure fair compensation for employees. The standard workweek in Sweden is 40 hours, with a maximum of 48 hours per week, including overtime. Overtime is typically compensated at a higher rate, with a minimum of 50% higher pay for work performed outside of normal working hours. Swedish law also mandates rest breaks, with a minimum of 30 minutes for every six hours worked.

Employees are entitled to at least 25 days of paid vacation per year, as well as paid sick leave and parental leave. Employers must ensure compliance with these laws to avoid penalties and litigation. However, it is important to note that flexible work arrangements, such as part-time and remote work, are becoming increasingly popular in Sweden, and employers are encouraged to offer these options to promote employee satisfaction and productivity.

Working Hours Per Week

Regular working time may not exceed 40 hours per week. In certain industries when it is necessary for the employee to carry out work activities, on-call time may be claimed up to a maximum of 48 hours per employee over a period of 4 weeks or 50 hours per calendar month.

Overtime

If overtime is required, it can go up to a maximum of 48 hours per employee over a period of four weeks, or 50 hours over a calendar month, with a maximum of 200 hours over a calendar year.

Termination laws and severance pay in Sweden are governed by the Employment Protection Act, which is aimed at protecting employees from unfair dismissal. Under this act, employers must have a valid reason for terminating an employee’s contract, such as redundancy or poor performance. If an employee is terminated without a valid reason, they can seek compensation through the labor court.

Additionally, employees who have worked for at least 12 months are entitled to severance pay, which is calculated based on their length of service and salary. The amount of severance pay is a minimum of two and a maximum of 24 months’ salary, depending on the length of service. Employers are also required to provide notice periods of up to six months, depending on the employee’s length of service.

The termination procedure varies depending on the terms of the Employment Agreement and Collective Agreement, as well as the type of contract and grounds for termination. However, without the Employee Insurance Agency, no termination for economic reasons or long-term incapacity can occur (UWV).

The notice periods in Sweden are outlined in the employment contract, collective bargaining agreement of the Employment Protection Act. 

Severance

Severance pay is outlined in the employees’ employment contract/collective agreement; there is no legal obligation to pay any severance.

Notice Period

Duration of employmentNotice period
Less than 2 years1 month
Two years but less than four years2 months
Four years but less than six years3 months
Six years but less than eight years4 months
Eight years but less than ten years5 months
Ten years or more6 months

Employment Contract

An employment contract in Sweden is a legally binding agreement between an employer and an employee that outlines the terms and conditions of their employment. The contract must comply with Swedish labor law and cannot be less favorable to the employee than what is stipulated by law or collective bargaining agreements. The contract typically includes details such as the job title, job description, working hours, salary, benefits, notice periods, and termination conditions.

The minimum notice period required by law is one month, but longer notice periods may be agreed upon by the parties. An employment contract in Sweden may be for a fixed term or an indefinite period, but if an employee has worked for the same employer for more than 12 months, they are entitled to a permanent contract. Employers are required to provide a written employment contract within one month of an employee starting work.

Indefinite term
If no fixed term is specified, the employment relationship will continue unless further notice is given. The probationary period for an open-ended employment relationship is six months.

Fixed-term

  • General fixed-term employment
  • Temporary substitute employment
  • Seasonal employment
  • Employment of an employee who has reached the age of 67
    The general fixed-term employments and temporary substitute contracts will be automatically transformed into indefinite-term employment when the employment exceed 2 years during a 5-year period.

    Probation Period

    The Employment Protection Act permits probationary employment for a period of no more than six months. If the employment is not terminated before the expiry of the probationary period, the employment will automatically become employment for an indefinite term.

  • Annual Leave

    Fulltime: 25 full days of annual leaves every year regardless of age or employment type.

    If employee enter into new employment after 31 August in any given year, then he is only entitled to 5 full days of vacation until 1 April the following year.

    As a general rule, the employer decides when the employees are to take their annual vacation. In some workplaces, the main annual vacation is decided by the local union club and employer. The employer must notify the annual vacation dates no later than two months before the start of the employee’s vacation.

    Sick Leave

    In order to obtain sick pay, you must be employed for at least 1 month or have worked continuously for 14 days. If you are away from work for more than 7 days due to sickness, you must provide a medical certificate.

    CompensationAmount (% of income)
    Sick pay from employer80%
    Sickness benefit at normal level80% * 0.97 (max. SEK 810 per day)
    Sickness benefit at continued level75% * 0.97 (max. SEK 759 per day)

    Maternity & Paternity Leave

    Parents in Sweden are entitled to 480 days of paid parental leave when a child is born or adopted. Each parent (if there are two of them) is entitled to 240 of those days. A single parent is entitled to a full 480 days.

    Public holidays in Sweden are regulated by the Swedish Holiday Act and consist of both Christian and secular celebrations. There are a total of 11 public holidays in Sweden, including New Year’s Day, Epiphany, Good Friday, Easter Monday, May Day, Ascension Day, National Day, Midsummer’s Eve, Christmas Eve, Christmas Day, and Boxing Day. Many Swedes celebrate these holidays with family gatherings, traditional foods, and various cultural activities.

    Some of the most important public holidays in Sweden are Midsummer’s Eve, which falls on the Friday between June 19th and 25th and is celebrated with outdoor festivities and the raising of the maypole, and Christmas, which is a major holiday season that spans from December 24th to January 13th. Public holidays in Sweden are observed nationwide, and most businesses and public services are closed on these days.

    Public Holidays

  • New Year’s Day – January 1
  • Epiphany – January 6
  • Good Friday – April 15
  • Easter – April 17-18
  • Labour Day – May 1
  • Ascension Day – May 26
  • Pentecost – June 5
  • National Day – June 6
  • Midsummer – June 24-25
  • All Saints’ Day – November 5
  • Christmas – December 24-25-26
  • New Year’s Eve – December 31
  • holidays in Sweden

    Resources

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