Employer responsibilities and possibilities with respect to COVID-19 outbreak

Employers' work environment responsibilities
Short-time work allowance
Comment

As in every other part of the world, the COVID-19 outbreak is affecting Swedish society in numerous ways. This article presents a selection of Swedish employment law-related responsibilities and possibilities for employers to be aware of in view of the effects of COVID-19, particularly with regard to their work environment responsibilities and the Short-Time Work Allowance Act.

Employers' work environment responsibilities

The risks to life and health posed by COVID-19 activate employers' work environment responsibilities under the Swedish Work Environment Act and its related provisions. Employers are responsible for employees' health and safety. With regard to COVID-19 and mandatory provisions on safe work environments, employers should start by making a risk assessment based on their business activities. Such assessment should result in measures for how the company would handle a virus spreading and what measures would be taken to avoid anyone being infected while working (eg, instructions on how to act during business travel and participation in and arrangement of internal and external meetings). Employers must make special considerations regarding employees who fall into the 'specific risk groups' category as defined by the authorities. Notably, there are several branch and business-adjusted work environment provisions that could result in employers having more specific and detailed responsibilities to which they must adhere. In addition, employers' general work environment responsibilities can also include work performed from employees' homes, as many Swedish white collar employees now do, especially in the Stockholm area.

Short-time work allowance

Many businesses are suffering from substantial financial losses and facing continued hard times following the COVID-19 outbreak. This will affect employers' need to retain staff. The Swedish legislature recently adopted amendments to the already existing but never used Short-Time Work Allowance Act (Lag om stöd vid korttidsarbete (2013:948)). The law regulates a system whereby employees' working hours can be reduced by 20%, 40% or 60%, while employees keep the main part of their salary and the employers reduce their costs by 19%, 36% or 53%, respectively, for each level. This is made possible through financial contributions from the Swedish state to employers with employees who participate in short-time work in accordance with the Short-Time Work Allowance Act.

The income ceiling is set to Skr44,000, which is the maximum amount on which the state will calculate the financial support. Employers must pay the full agreed salary to employees during the grant period (ie, advance payment is also made for the part for which the central government will later pay).

Under the current circumstances, the system can be described as protective for both employees and employers and an alternative to termination due to shortages of work and redundancy.

In order to qualify for financial support under the Short-Time Work Allowance Act, employers must, among other things, demonstrate financial difficulties that are temporary and severe and that have been caused by circumstances outside of their control (eg, due to the COVID-19 pandemic). Employers must also have assessed other options to cut staff costs prior to applying for the short-time work allowance (eg, through termination of non-permanent employees and employees that are not essential to business activities).

For workplaces with collective bargaining agreements, a short-time work allowance must be provided through the signing of central or local collective agreements. For workplaces that are not bound to a collective bargaining agreement, among other things, 70% of the staff must agree to reduce their working hours through individual agreements.

Comment

Applications have been open since 7 April 2020, but employers can apply for the financial support retroactively from 16 March 2020. Employers interested in applying for financial support combined with reduced working hours for employees should initiate such process by thoroughly investigating the different mandatory criteria before making any decisions regarding or applying for financial support for short-time work. (There are other criteria and procedures that must be met than what has been presented in this article.)

On 14 April 2020 the government suggested further improvements to the already newly amended Short-Time Work Allowance Act. The government proposed, among other things, that it should be made possible to reduce employees' working hours by 80% and combine this with financial support from the state for the employees' salaries. No formal decisions on adopting these additional amendments have been made and the proposal is intended to be handed over to the Parliament in mid-May 2020.

For further information on this topic please contact Jörgen Larsson or Viktoria Hybbinette at Wistrand by telephone (+46 31 771 21 00) or email (jorgen.larsson@wistrand.se or viktoria.hybbinette@wistrand.se). The Wistrand website can be accessed at www.wistrand.se.