Employer of Record in Sweden (EOR in Sweden)

Hire Globally, Pay Locally, Expand Effortlessly

Sweden, with its innovative economy and strategic location in Northern Europe, presents significant potential for companies aiming to grow their international presence. However, expanding into the Swedish market requires careful navigation of the country’s detailed labor laws and tax regulations. Partnering with an Employer of Record (EOR) in Sweden can simplify this process by serving as your local expert, ensuring a seamless market entry and continuous compliance with all relevant legal standards.

Want to have a Team in Sweden TODAY?

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Want to Have a Team in Sweden TODAY?

Show me how to grow my business now!

We prefer to let others grow their business.

How an Employer of Record in Sweden Gets Your Employees Working Locally in 3 Steps

Step 1 – Strategic Business Planning & Assessment

Collaborating with an EOR in Sweden, such as INS Global, starts with an in-depth analysis of your business goals. This involves evaluating the number of employees, their roles, and your timeline for entering the Swedish market. The EOR customizes its services to meet your specific needs, ensuring a streamlined entry into Sweden.

Step 2 – Efficient Setup, Recruitment & Integration

When establishing a new team in Sweden or transferring existing staff, an EOR manages all the essential legal requirements. This includes processing visas, work permits, payroll, and contract management, ensuring adherence to Swedish labor laws. Acting as your legal employer in Sweden, the EOR reduces the complexities and expenses involved in setting up a local entity.

Step 3 – Continuous Management & Compliance Support

Once your operations are active in Sweden, an EOR provides ongoing HR and payroll management. This encompasses salary processing, overseeing employee benefits, and ensuring compliance with health insurance and social security contributions. The EOR functions as the HR point of contact between you and your Swedish team, handling administrative duties and employee-related issues, freeing you to focus on business development.

The Advantages of a Swedish EOR On Your Business

Simplified Market Entry

An EOR in Sweden facilitates a smooth market entry by efficiently handling tax obligations and labor laws, ensuring your compliance from the start.

Consistent Compliance Expertise

Navigating Sweden’s regulatory framework can be complex, but EORs are well-versed in ensuring your business adheres to local tax laws, labor regulations, and social security requirements.

Reduction of Risk and Legal Liability

As your legal employer in Sweden, an EOR reduces the risks associated with local employment laws, ensuring your business stays compliant and protected from potential legal issues.

Cost-Effective Business Solutions

EOR services in Sweden offer a financially efficient alternative to setting up a local entity, especially for smaller teams or temporary projects, helping you avoid the high costs of incorporation and ongoing administrative responsibilities.

Emphasis on Core Business Goals

Outsourcing HR responsibilities, including recruitment, payroll processing, and tax management, to an EOR allows you to concentrate on your core business objectives and pursue strategic growth.

Testimonial

Manuel Ramos

TERAO ASIA

Managing Director

We think INS Global is a good solution about starting business in new and complex markets. Understanding the market doesn’t mean you need to set up a company immediately.

 5/5

Choosing Between an EOR and Company Incorporation in Sweden

While forming a subsidiary in Sweden is one option, opting for an EOR presents several benefits:

Speed – Utilizing an EOR like INS Global in Sweden accelerates the setup process, allowing for rapid recruitment and operational readiness. Establishing a local subsidiary can be time-consuming, but an EOR can get your team up and running in a matter of weeks or even days.
Compliance – Both EORs and subsidiaries must comply with Swedish tax laws and labor regulations. EORs, however, offer the advantage of local expertise to manage these obligations efficiently, ensuring continuous compliance without the need for internal specialists.
Cost – For smaller teams or temporary expansions, EOR services are often more economical than establishing a subsidiary in Sweden. They help you avoid upfront incorporation costs and ongoing administrative overheads, while also providing seamless integration into multi-country payroll systems for larger companies.
Control – While incorporation offers comprehensive control over HR, financial, and operational aspects, EORs provide a similar level of control with the added benefit of minimizing administrative duties and reducing potential legal liabilities.

5 Essential Factors for Selecting the Best Employer of Record in Sweden

Choosing the right EOR in Sweden is vital for smooth market entry. Consider these 5 important factors:

Proven Expertise and Strong Reputation – Seek an EOR in Sweden with a solid history of success and a strong reputation, like INS Global. Positive client feedback and industry recognitions are good indicators of their reliability and competence.
Comprehensive Service Offerings – Ensure the EOR in Sweden provides all necessary services or can customize them to suit your business requirements. This might include visa and work permit services, payroll processing, tax compliance, and navigating Sweden’s complex tax and labor regulations.
Scalability and Responsiveness – Choose an EOR in Sweden that can scale its services as your business expands. They should be able to accommodate an increasing workforce and respond effectively to changing business conditions.
Transparent Communication and Reliability – Opt for an EOR in Sweden known for maintaining clear and open communication. They should keep you informed about regulatory updates, impending deadlines, and any challenges that may arise. A dedicated contact and user-friendly online tools are beneficial for accessing important information.
Transparent and Fair Pricing – Compare the pricing models of various EOR providers in Sweden. Make sure their fees are transparent, competitive, and without hidden costs. Seeking advice from third-party sources can help you find the best value.

Sweden Labor Law Overview

Employment Contracts – In Sweden, employment contracts must be written in Swedish or English and should clearly define key employment terms, including salary, benefits, working hours, termination clauses, and notice periods. Swedish labor law strongly favors indefinite employment contracts, although fixed-term contracts are allowed under certain conditions. An EOR in Sweden ensures that all contracts are compliant with Swedish Employment Protection Act (LAS) requirements, safeguarding both your business and your employees.
Probationary Periods – The maximum probationary period allowed in Sweden is 6 months. During this time, either the employer or the employee can terminate the contract with a shorter notice period. If the employment continues beyond the probationary period without formal termination, the contract automatically becomes permanent. An EOR can help structure probationary periods that align with Swedish laws, giving you the flexibility to assess new employees while adhering to legal standards.
Working Hours – The standard workweek in Sweden is 40 hours, with regulations in place to ensure that any overtime is compensated at a higher rate, typically 50% to 100% above the normal wage, depending on the circumstances. Swedish law also mandates specific rest periods and limits on the number of consecutive work hours. An EOR assists in monitoring work schedules, ensuring compliance with the Working Hours Act and managing any overtime payments or compensatory time off.
Paid Leave – Sweden offers generous paid leave entitlements, including a minimum of 25 days of annual leave, public holidays (which may vary by region), and extensive parental leave rights. Employees can take up to 480 days of parental leave per child, which can be shared between parents. Additionally, employees are entitled to sick leave and leave for personal reasons under certain conditions. An EOR manages all aspects of leave administration, ensuring compliance with Swedish labor laws and that employees receive their full entitlements.
Health Insurance and Social Security – In Sweden, employers are required to pay into the social security system, which covers health insurance, pensions, unemployment benefits, and parental leave compensation. Contributions are also made to the Occupational Pension Scheme (ITP), which supplements the public pension. An EOR handles all these contributions through the payroll process, ensuring that your business meets all statutory obligations and that employees are well-covered by Sweden’s comprehensive social security system.
Severance Pay – While Swedish law does not generally require severance pay, employees with long-term contracts or those covered by collective agreements may be entitled to compensation upon termination. Additionally, the Employment Protection Act (LAS) provides robust protection against unjust dismissal, requiring employers to have valid reasons for termination. An EOR provides guidance on managing employee terminations in compliance with Swedish laws, including the calculation of any severance or compensation that may be due.

Navigating Sweden’s labor laws requires careful attention to detail, especially given the country’s strong worker protection regulations. Partnering with an EOR in Sweden ensures that your business remains fully compliant with all labor laws, protecting you from potential legal challenges and allowing you to concentrate on your core business activities.

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FAQs

How does an EOR in Sweden assist with compliance under the Employment Protection Act (LAS)?

An EOR ensures that your business adheres to the Swedish Employment Protection Act (LAS), which governs employee rights, including job security, notice periods, and fair termination practices. They handle the legal complexities, keeping your business compliant.

Can an EOR manage the extensive parental leave entitlements in Sweden?

Yes, an EOR in Sweden manages the administration of parental leave, which includes up to 480 days of leave per child. They ensure that all legal requirements are met and that employees receive the appropriate compensation during their leave.

How does an EOR support recruitment and onboarding in Sweden?

An EOR facilitates recruitment and onboarding by managing the legal requirements for employment contracts, work permits (if necessary), and compliance with Swedish labor regulations. They streamline the process, ensuring a smooth start for new hires.

What role does an EOR play in handling collective agreements in Sweden?

An EOR helps navigate the complexities of collective agreements, which are common in Sweden and often provide additional rights to employees beyond statutory requirements. They ensure that your business complies with these agreements and integrates them into employment contracts.

How does an EOR manage occupational pension contributions in Sweden?

An EOR handles contributions to Sweden’s occupational pension schemes (such as ITP), ensuring that both employer and employee contributions are accurately calculated and processed in line with legal requirements.

Can an EOR help with the administration of Sweden’s public holidays and annual leave policies?

Yes, an EOR manages the scheduling and compensation of public holidays and the mandatory 25 days of annual leave in Sweden, ensuring that your business adheres to local regulations and that employees receive their full entitlements.

How does an EOR assist with work permits for non-EU employees in Sweden?

An EOR in Sweden manages the application process for work permits and residence permits for non-EU employees, ensuring compliance with Swedish immigration laws and facilitating a smooth transition for international hires.