Sweden

Employer of Record & PEO in Sweden

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

Native Language

Swedish

GDP

$622.36 billion

Payroll Frequency

Monthly

Capital city

Stockholm

GDP per capita

$58,639

Internet

Fast

Currency

Swedish Krona (SEK)

Timezone

UTC +1

English Speaking

>90%

Population

10.20 Million

Employment Cost

High

Cost of Living

High

How NNRoad Employment & PEO Services Work?

NNRoad provides professional employment organization (PEO) & employer of record (EOR) services for companies looking to hire and manage teams in Sweden. Registering a legal entity in Sweden as a means for employment is an outdated practice that takes both time (months) and money (thousands of USD). NNRoad’s employer of record and PEO services enables companies to hire and manage employees in Sweden in full accordance with local labor laws in under a week.

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 in Sweden. Employment and full liability are outsourced to NNRoad.

➊ You interviews & select the candidates you want to hire in Sweden
➋ NNRoad arranges a local labor contract with your new employee.
➌ NNRoad arranges a service contract between your organization & NNRoad.
➍ NNRoad organizes, manages & processes  payroll in Sweden in full compliance with local employment laws.
➎ You maintain a normal working relationship and manage your team in Sweden while NNRoad manages payroll & HR liabilities.

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.

➊ You interviews & select the candidates you want to hire in Sweden.
➋ NNRoad organizes, manages and processes payroll for your local employees in full compliance with local employment laws.
➌ You maintain a normal working relationship and manage your team in Sweden while NNRoad manages payroll & HR compliance.

Advantages of NNRoad's Sweden Employment Services

  1. With EOR/PEO solutions you can manage client meetings, sales, quality control, marketing, R&D and customer support without a local company in Sweden.
  2. Pay as you go
  3. ​​Dedicated account manager – One point of contact for multiple locations
  4. Employment & termination processing
  5. Complete payroll solution and statutory benefit according to local laws
  6. With EOR/PEO solutions you can hire staff while waiting for the registration of your company in Sweden.
  7. NNRoad only works with professional locally licensed partners
  8. GDPR compliant
  9. NNRoad manages employee record timekeeping, bonus and allowance, expenses claims and personal leaves according to local law.
  10. NNRoad provides foreigner VISA application services, if needed

Employment Compliance in Sweden

Taxes & Payroll in Sweden

Tax Brackets

Taxable income (SEK)National income tax (%)Municipal income tax (%)
0 to 540,700032
Over 540,7002032

Employer Costs in Sweden

Employer Contributions:

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 Contributions:

Pension insurance: 7%

Total cost: 7%

Working Hours and Overtime in Sweden

Regular working time and on-call time 

  • 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. 

Mandatory Contributions in Sweden

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. 

Termination Laws and Severance Pay in Sweden

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.  

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

Severance

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

Holidays in Sweden

Public Holidays in Sweden

  • 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

Paid Leave in Sweden

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. 

Employment Contract in Sweden

Employment Contract

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.

Types of Leaves in Sweden

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 and 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. 

Immigration Laws in Sweden

Before entering Sweden, all non-EU and EEA residents must first secure a job offer and a work permit. An employee cannot reside or work in Sweden unless he or she has a valid working visa. Your employee may be eligible for an EU Blue Card or an Intra Corporate Transfer (ICT) Permit depending on their occupation or home country.

A European Union Blue Card is a work and residence permit for highly trained workers. Applicants must work in specific fields, have a university degree, or have five years of professional experience.

Resources

Scroll to Top