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Collective agreements and the co-determination act for employers

A collective agreement is a written agreement between an employer and a trade union and contains rules on things such as pay and employment terms and conditions.

You are bound through your membership

As an employer, you become bound by a collective agreement by becoming a member of an employer organisation or by signing what is known as an affiliated collective agreement.

Some employer organisations also serve as trade organisations. Thus, membership in a trade organisation could mean that you are bound by a collective agreement.

Affiliated collective agreement – if you are not a member of an employer organisation

Companies that are not part of an employer organisation can instead have an affiliated collective agreement. This applies in particular to smaller companies with a small number of employees.

An affiliated collective agreement means that you, as an employer, agree with the union that the rules of a particular collective agreement will apply in your company. Signing an affiliated collective agreement has practically the same effect as if the company had a collective agreement.

With an affiliated collective agreement, the rules of the collective agreement apply to the relationship between you and your employees. At the same time, it means that you must comply with the legal rules on collective agreements, such as the Co-Determination in the Workplace Act and the Representatives Act.

Signing a collective agreement is voluntary

Signing a collective agreement is voluntary. However, as an employer, you must negotiate a collective agreement or a affiliated collective agreement if a trade union organisation requests this.

What does a collective agreement contain?

Collective agreements often contain rules on:

  • employment types
  • working hours
  • salaries and other compensation
  • leave
  • dismissal
  • pension and accident insurance.

The agreement applies to all employees

Once you have signed a collective agreement or affiliated collective agreement, it applies in practice to all your employees. It does not matter if some of them are not unionised, or if they belong to another union with which you do not have a collective agreement.

Collective agreements become part of the personal employment contract between you as an employer and your employees.

Co-Determination in the Workplace Act (MBL)

Collective agreements are regulated in the Co-Determination in the Workplace Act (MBL), which also sets out the rights and obligations that all parties have when they sign collective agreements.

You can search for information on the parties to collective agreements and the duration of agreements in the National Mediation Office's agreement database.

Co-Determination in the Workplace Act (MBL) at Riksdag (in Swedish)

Go to the agreement database at The Swedish National Mediation Office

Regular negotiations on content

A collective agreement is usually valid for 1–3 years. After that, it must be renegotiated. This takes place during what is known as a round of collective bargaining. This is when the employer organisation or an individual employer negotiates with the trade union in question.

Parties that are bound by collective agreements are subject to what is known as the peace obligation. This means that the parties are not allowed to initiate or participate in industrial action such as lockouts, strikes, blockades or boycotts as long as the agreement is in force. There are certain exceptions to the peace obligation, mainly regarding the so-called sympathy measures.

Primary and secondary negotiation obligation

The Co-determination Act (MBL) regulates the so-called primary and secondary bargaining obligations.

Primary obligation to negotiate means that the employer must initiate and carry out negotiations. The secondary negotiation obligation means that the union can request negotiation on a certain issue or decision.


The National Mediation Office helps with disputes

The state established the National Mediation Office to support negotiations between the parties. In the event of disputes in connection with negotiations on wages and general terms and conditions of employment, the National Mediation Office can appoint mediators at the request of the parties.

What applies to disputes in connection with negotiations at the National Mediation Office

Prerogative of interpretation

If a legal dispute arises between the employer and a trade union holding a collective agreement regarding wage and compensation claims for individual employees, it is in principle you as the employer who has the right of interpretation.

Your interpretation only applies if you immediately request negotiations with the union. If the negotiations do not lead to a solution, you as an employer must bring an action before the Labour Court within 10 days of the end of the negotiations. If you fail to meet this deadline, you must pay what the employee organisation demands. This is provided that the demand is not unreasonably high.

Please note that this does not apply to an individual employee's salary requirements, but rather when a trade union organization with a collective agreement makes demands and the dispute applies to the interpretation of how salary and compensation are calculated under the law or agreement.

Go to the Labour Court's website (in Swedish)