Medborgarskapskursen

Chapter 8 of 13 in Sverige i fokus

Labour market and personal finances: social partners, collective agreements and a-kassa

Shayan Parsai, kursansvarig och kursutvecklare
Written byLinkedIn

Published: · Reading time: about 5 min

Quick answers

Who are the social partners (arbetsmarknadens parter)?
The employer organisations (for example Svenskt näringsliv, Arbetsgivarverket and SKR) and the employees' trade union organisations (LO, TCO and SACO). They negotiate wages and conditions.
What is a collective agreement (kollektivavtal)?
An agreement between a trade union and an employer on wages and working conditions. It applies to all employees at the workplaces covered by the agreement.
Who sets wages in Sweden?
The social partners, through negotiations. The state does not set wages.
What is a-kassa?
The unemployment insurance fund (arbetslöshetskassa), an economic association that pays money to unemployed members. It is financed by the state and by members' fees.

The citizenship test is written in Swedish, so the key Swedish terms are given in brackets the first time they appear. This chapter is also available in Swedish: Arbetsmarknad och privatekonomi.

Chapter 8 of Sverige i fokus is about how the Swedish labour market (arbetsmarknaden) works: work, unemployment, employers and employees. The chapter also covers personal finances (privatekonomi), meaning people’s income, expenses, savings and loans.

How does the labour market in Sweden work?

The labour market can be divided into two parts: the public sector (offentlig sektor) and the private sector (privat sektor).

The public sector is everything that the state, the regions and the municipalities are responsible for. It is paid for with taxes. Healthcare staff, teachers, childcare workers, police officers and firefighters work in the public sector. About 30 percent of everyone who works in Sweden works there.

The private sector is all companies that are privately owned. That can be shops, restaurants, factories and construction companies. It can also be companies that work with law, finance or transport. Around 70 percent of everyone who works is employed in the private sector.

The labour market looks different in different parts of the country. Big cities have many companies in services and trade. Smaller towns often have industry, such as steelworks and paper mills. These are often located close to the natural resources they need.

Who are the social partners?

The labour market has employers (arbetsgivare) and employees (arbetstagare). The employer hires people and pays their wages. The employee is the person who is employed. Both sides have organised to look after their interests. These organisations are called the social partners (arbetsmarknadens parter).

Employer organisations (arbetsgivarorganisationer) represent the employers. The largest are Svenskt näringsliv for private companies, and Arbetsgivarverket and SKR (Sveriges kommuner och regioner) for public sector workplaces.

The trade union organisations (fackliga organisationer) represent the employees. The three largest confederations (centralorganisationer) are LO (Landsorganisationen i Sverige), TCO (Tjänstemännens centralorganisation) and SACO (Sveriges akademikers centralorganisation). Each confederation contains many individual trade unions (fackförbund). It is the employees at a workplace who can be members of a union.

Unions work to improve conditions for employees. They negotiate (förhandlar) wages with the employer. They can also help a member who has problems at work.

What is a collective agreement?

Unions and employer organisations negotiate and sign agreements on wages and working conditions. Such an agreement is called a collective agreement (kollektivavtal). It applies to all employees at the workplaces covered by the agreement. Under the Co-determination Act (medbestämmandelagen, 1976:580), a collective agreement is a written agreement between an employer or employer organisation and an employee organisation.

This is important to remember: in Sweden, wages are set through negotiations between the social partners. The state does not set wages.

What does this mean for you? If your workplace is covered by a collective agreement, its wages and conditions apply to everyone employed there. You do not have to negotiate everything yourself. The union has already done that together with the employer’s organisation.

Which laws apply on the labour market?

There are laws that protect employees’ rights and ensure a safe working environment. For example, there are laws on working hours, the work environment and holidays. The Employment Protection Act (lagen om anställningsskydd, 1982:80), usually called LAS, applies to employees in both the public and the private sector. The Annual Leave Act (semesterlagen, 1977:480) gives an employee 25 days of holiday per year.

The employer must also pay fees to the state for employees’ pensions and sickness insurance. These are called employer contributions (arbetsgivaravgifter).

Everyone who works pays tax (skatt) on their wages. How much you pay depends on how much you earn. Working without paying tax is illegal. Everyone who has had an income during the year must declare it (deklarera) to the Swedish Tax Agency (Skatteverket).

What is a-kassa?

A-kassa is short for arbetslöshetskassa, the unemployment insurance fund. Unemployment insurance (arbetslöshetsförsäkringen) means that a person who loses their job can still have an income. The a-kassa is an economic association that pays money to unemployed members. So you must be a member of an a-kassa to receive money from it.

To receive benefit (ersättning) you must have worked enough hours during a set period. You must also be actively looking for work. The benefit is financed by the state and by members’ fees.

The a-kassa and the union are two different things. The union negotiates wages and helps with problems at work. The a-kassa pays out money when you are unemployed.

What do personal finances look like in Sweden?

Personal finances are about your income (inkomster) and expenses (utgifter). Income can be wages or benefits. Expenses are costs for things like housing, food and clothes.

Wages in Sweden are fairly high compared with many other countries. How much you earn depends on your occupation, education, experience and industry. The state also provides money through social insurance (socialförsäkringar), for example pensions, sickness benefit and child allowance.

Many people save money in bank accounts, funds or shares. Many also borrow money from the bank to buy a home or a car. Housing prices have risen sharply in many parts of Sweden over recent decades. That is why the mortgage is often a large part of a household’s finances. It is also common to buy things on credit (kredit), for example with a credit card. The interest on such loans is often high.

The Swedish Enforcement Authority (Kronofogdemyndigheten), usually called Kronofogden, is a government agency that makes sure debts are paid. Kronofogden can also help people with large debts to get their finances in order. This is called debt restructuring (skuldsanering).

What the test usually asks about

  • The difference between the public and the private sector, and that about 70 percent work in the private sector.
  • Which occupations belong to the public sector.
  • Who the social partners are: employer organisations and trade unions.
  • The names of the largest organisations: Svenskt näringsliv, Arbetsgivarverket, SKR, LO, TCO and SACO.
  • What a collective agreement is, and that wages are set by the partners, not by the state.
  • That everyone who works pays tax and must declare their income to Skatteverket.
  • What the a-kassa is, what is required to get benefit and how it is financed.
  • What Kronofogden does and what debt restructuring is.

Practise the chapter

The questions for chapter 8 are on the page questions for chapter 8. They are ten practice questions we have written from the chapter, not UHR’s questions. Read the chapter first, then read the explanation for each answer. You can also try the practice test.

Difficult words in this chapter

sektor
sector: a part of the labour market, for example the public or the private sector
arbetsgivare
employer: the one who hires people and pays wages
arbetstagare
employee: the one who is employed and receives wages
fackförbund
trade union: an organisation for employees that negotiates wages and helps its members
centralorganisation
confederation: a large organisation that brings together many trade unions, for example LO
förhandla
to negotiate: to discuss in order to reach agreement, for example on wages
ersättning
benefit: money you receive instead of wages, for example when you are unemployed
kredit
credit: buying now and paying later, usually with interest
skuldsanering
debt restructuring: help for someone with large debts to get their finances in order
deklarera
to declare: to report your income to the Swedish Tax Agency (Skatteverket)

Frequently asked questions

What share of all workers are in the public sector?

About 30 percent. Around 70 percent work in the private sector.

Which are the largest trade union confederations?

LO (Landsorganisationen i Sverige), TCO (Tjänstemännens centralorganisation) and SACO (Sveriges akademikers centralorganisation).

What is required to receive benefit from the a-kassa?

You must have worked enough hours during a set period and be actively looking for work.

Is it illegal to work without paying tax?

Yes. Everyone who works pays tax on their wages, and how much depends on their income.

What does Kronofogdemyndigheten do?

Kronofogden is a government agency that makes sure debts are paid. It can also help people with large debts through debt restructuring (skuldsanering).

The course

The full course, all 13 chapters

99SEK per month

or 499 SEK for a full year

  • Lessons for every chapter of Sverige i fokus
  • Practice questions with explanations and page references
  • A mock test in the same form as the August test
  • Difficult words explained in plain Swedish
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Sources