European Foundation
for the Improvement of
Living and Working Conditions

The tripartite EU agency providing knowledge to assist
in the development of better social, employment and
work-related policies

EU PolicyWatch

Database of national-level policy measures

Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for measure SE-2013-48/2709 Updated – measures in Sweden

Short-time work allowance

Korttidsarbete (korttidspermittering)

Country Sweden , applies nationwide
Time period Open ended, started on 28 November 2013
Context COVID-19, Restructuring Support Instruments
Type Legislations or other statutory regulations
Category Employment protection and retention
– Income support for people in employment (e.g., short-time work)
Author Anna-Karin Gustafsson (Oxford Research) and Eurofound
Measure added 23 June 2022 (updated 26 April 2024)

Background information

Support for short-time working (also known as short-time layoffs) is regulated in the Act (2013:948) on short-time working (Lag (2013:948) om stöd vid korttidsarbete). Short-time working means that employers can reduce their employees’ working hours and receive financial support from the central government to compensate for a significant part of the costs for retaining the employee.

This instrument was introduced in 2014, some years after the financial crisis in 2008. Under current legislation, support to short-time working is a temporary measurement in the sense that it can only be activated in a deep recession or if the risk for such is imminent. An additional requirement is that the activation of this support scheme does not impede structural change in the economy.

However, in March 2020 the government proposed changes to the Act on short-time working (2013:948) that would make it possible for companies facing significant and temporary financial challenges to apply for support even if this measure has not been activated due to COVID-19 pandemic.

The Swedish Agency for Economic and Regional Growth (Tillväxtverket) is the administering authority for the short-time working scheme.

Content of measure

The short-time working scheme was activated in April 2020 due to the Covid-19 pandemic for the first time. Individual employers facing serious financial difficulties that could not reasonably have been foreseen or avoided can now apply for financial support for a limited period.

Temporary amendments to the Act on short-time working (2013:948) that decrease the costs of the use of the short-time working scheme have been made. Under these temporary provisions, working time can be reduced by up to 60% (except for June and July 2020 when working time can be reduced up to 80%). In the currently applied scheme, 20-60% reduction in working hours decreases the costs of the employer by 19-53%. The state covers up to 45% of the costs (except for June and July 2020 when working time can be reduced up to 80% and the state covers up to 60% of the costs).

The application to receive support opened on 7 April 2020 but will be retroactively applied to as early as from 16 March. This temporary provision is in force until the end of 2020.

As part of the package of measures to mitigate the economic impact of the Covid-19 outbreak for companies, the Swedish government has also introduced a temporary reduction of employers’ social security contributions for the period 1 March to 30 June 2020. Employers were only obliged to pay the old-age pension contribution. This reduction applies to up to 30 employees and on that portion of the employee’s wage that does not exceed SEK 25,000 (approximately €2,400) per month. This entails tax relief of up to SEK 5,300 (approximately €500) per employee and month. The proposal’s cost to public finances is estimated to SEK 33 billion (approximately €3.3 million). This measure could be used by companies receiving short-term working allowance, new-start job subsidies and other types of financial support from the central government.

Updates

The following updates to this measure have been made after it came into effect.

01 April 2022

This short-term furlough aid has once again been changed. Some of the major changes are (as of 8 September 2023):

  • The use of "Covid-19 pandemic" as a reason for receiving aid was removed.
  • The amount of wages the state will be subsidising was changed from 75% to 33%.
  • Family members working in the same company may no longer receive short-term furlough aid from the state.
  • The agency in charge as been changed from the Swedish Agency for development and regional growth (SV: Tillväxtverket) to The Swedish Tax Agency (SV: Skatteverket).
01 December 2021

During the Covid-19 pandemic, the short-time working allowance scheme was open to all companies of the private sector who face temporary and severe economic difficulties. The final extended application date was in 30 November 2021 for the applications on the economic problems caused by the Covid-19 pandemic.

Use of measure

According to the Swedish Agency for Economic and Regional Growth, they had received 74,700 applications by 15 June 2020. Two months later, in August 2020, the number of applications was 81,300. 

In August 2020, the number of employees covered by this measure was approximately 570,000. The amount of financial support granted for companies by August 2020 was SEK 27 billion (approximately €2.6 billion). 

The estimated financial support that will be paid out to companies during 2020 SEK 95 billion/ €9.5 billion.

Target groups

Workers Businesses Citizens
Employees in standard employment
Applies to all businesses Does not apply to citizens

Actors and funding

Actors Funding
National government
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Consulted Consulted
Form Direct consultation outside a formal body Direct consultation outside a formal body

Social partners' role in the implementation, monitoring and assessment phase:

  • Unknown
  • Main level of involvement: Peak or cross-sectoral level

Involvement

Employer's organisations and trade unions were invited to leave a statement before the parliamentary proceedings.

Views and reactions

The Swedish Confederation of Professional Employees (TCO), the Swedish Trade Union Confederation (LO) and the Confederation of Swedish Enterprise (Svenskt näringsliv) have argued for an extension of the short-time working scheme to full-time during the COVID-19 pandemic. Further, all of the Confederations argues that the Government's should have had reacted to the effects of COVID-19 pandemic quicker.

Sources

Citation

Eurofound (2022), Short-time work allowance, measure SE-2013-48/2709 (measures in Sweden), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/SE-2013-48_2709.html

Share

Eurofound publications based on EU PolicyWatch

30 January 2023

 

Measures to lessen the impact of the inflation and energy crisis on citizens

Governments across the EU continue to implement policies to support citizens and businesses in the face of rising food and energy prices caused by the COVID-19 crisis and intensified by the war in Ukraine. This article summarises the policy responses as reported in Eurofound's EU PolicyWatch database from January to September 2022.

Article

12 September 2022

 

First responses to cushion the impact of inflation on citizens

Although the worldwide pandemic situation had already disrupted supply chains and triggered increases in energy and food prices in 2021, the situation deteriorated in 2022 with the Russian invasion of Ukraine.

Article

12 September 2022

 

Policies to support EU companies affected by the war in Ukraine

This article summarises the first policy responses that governments across the EU have started to implement to support companies affected by the rising prices, and those with commercial ties to Ukraine, Russia or Belarus.

Article

5 July 2022

 

Policies to support refugees from Ukraine

This article summarises the first policy responses of EU Member States, including those of the social partners and other civil society actors, enabling refugees to exercise their rights under the Temporary Protection Directive.

Article

Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.