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Higher employment protection age

Saco-S and the Swedish Agency for Government Employers have agreed on amendments to Villkorsavtal-T, Affärsverksavtal-T and Chefsavtalet as a result of the employment protection age, (entitlement to remain in employment), being increased from 67 to 68 on 1 January 2020 and to 69 on 1 January 2023.

What do the new provisions in LAS and the collective agreements mean?

In addition to increasing the age limit, these provisions also change how employment may be terminated by the employer once the relevant age limit has been reached. Up until the end of this year, the employer continues to be able to terminate employment at the end of the month in which the employee reaches the age of 67, after giving written notice of this at least one month in advance. From 1 January 2020, the employer may terminate the employment of a person who has reached the age of 68 (69 from 2023) without any requirement for a substantive basis for dismissal. In this case, the employer must notify the employee of the intent to terminate employment at least 14 days in advance. The employee and the union may then request a consultation with the employer regarding the notification. Consequently, employment may continue after the age of 68 (69) if the employee or employer does not actively terminate the employment contract.

Special rules apply to employees with special authorisations (fullmaktsanställning), and there is also a transitional provision for employees over the age of 67 in January 2020 in LAS. This is explored more thoroughly in the FAQs below.

In the agreement, Saco-S and the Swedish Agency for Government Employers have particularly emphasised the importance of the employer and the employee opening a discussion when an employee approaches the age limit. The purpose of this is to conduct a dialogue on how to reach an agreement which is the best possible for both the employee and the employer’s operations.

From 2020, the maximum age specified in the Swedish Employment Act (LAS) that gives the right to retain employment, (known as the LAS age), is 68 years. In 2023, this will be raised to 69 years. After the age of 68, you can keep your job, but the employer has the right to terminate your employment without objective grounds and with a shorter notice period.

Discuss the matter with your employer. If you want to stay on and work, this is entirely possible. You may also request changes in work tasks or you may want to reduce your working hours.

The terms of employment under Villkorsavtal-T do not change because you have reached a certain age. This means that you continue, for example, to be entitled to the same number of holiday days as before as well as all the other benefits contained in the agreement. However, indirect conditions may be affected, for example, sickness benefit supplement payable during sick leave, as opportunities for sickness benefits are dependent on the age of the person concerned.

There are conditions in some other collective agreements that are affected after reaching a certain age. Contact your local Saco-S representative or SULF member’s helpline for more information.

If you would like to leave your job, discuss an appropriate date for this, for example if there are tasks that both you and the employer think should be completed after you have passed the age limit. It may feel better to choose to terminate employment yourself by resigning instead of being terminated at the end of a long working life, which may result from not reaching an agreement. Also, consider applying for the start-up of payment of your retirement pension well in advance if this is the case, as it can take up to three months for your pension to be paid out.

The notice period is one month when the age limit has been passed. Before the age limit, two months’ notice period usually applies. It is also possible to agree a different notice period with your employer.

However, if you are covered by the chefsavtalet, (i.e. you are a manager), or have a position where you personally hold certain authorisations, the notice period is three months after the age limit has been passed unless otherwise agreed. Prior to the age limit, a six-month notice period applies.

If the employer wishes to terminate your employment after you have reached the age of 68, there is no longer any need for a substantive basis for dismissal. However, the employer must notify you in writing at least 14 days before the notice of termination is issued. You, and also your local Saco-S Association may request a consultation with the employer about this notification within a period of one week. During such a consultation, discuss whether there are any other alternatives for the employer. This may, for example, include the opportunities to work with other tasks, reduce your working hours to part-time, resign or switch to employment on a fixed-term contract. However, as mentioned above, this dialogue should have been carried out at an earlier stage. If the employer does not change their opinion after consultations, the employer is entitled to terminate your employment, although no earlier than the day you reach the age of 68, (69 from 2023). The notice period is then one month unless otherwise agreed. If you are covered by the chefsavtalet, the notice period is three months.

If you are in this situation and intend to apply for payment of your retirement pension, act quickly so that, hopefully, your pension payments will begin in conjunction with the termination of your employment.  Processing at the Pensions Agency and the National Government Employee Pensions Board, (SPV), can take up to three months.

Because your employment cannot be terminated with the support of the provisions of the Employment Protection Act, LAS, special termination rules apply at a certain age. The current obligation to resign is in force until the end of 2019, i.e. at the end of the month you become 67. Since the transitional provision contained in LAS for other employees does not apply to you, the age of obligatory retirement is increased to 68, (or a later date notified by the employer), as of 1 January, even if your 67th birthday falls in January 2020. On 1 January 2023, the obligatory retirement age is increased to 69.

If your employment continues and you wish to terminate your employment after the age of obligatory retirement has passed, you have your own special notice period of three months, unlike the six-month period which otherwise applies to such employees.