European Restructuring Monitor (ERM)
Eurofound's ERM database on restructuring-related legal regulations provides information on regulations in the Member States of the European Union and Norway which are explicitly or implicitly linked to anticipating and managing change.
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A dismissal without just cause should be declared null and void by the employer if so requested by the employee, unless the employee is dismissed due to a shortage of work. If there is a shortage of work, the dismissal is null only if the seniority rules on selection are violated. The labour courts settle any disputes over rights and obligations. In addition, economic and general damages can be paid.
Failure to inform and consult trade unions or to give notification to the public employment service does not make the collective dismissals void, but may make the employer liable for fines (about €10–60 per affected employee and the fines increase with the length of the failure to consult and notify).
If an employer fails to comply with a court order declaring a dismissal null and void, the employment relationship is deemed as having been dissolved, and the employer has to pay (additional) compensation to the employee (up to 32 monthly wages).
In 2022 there were some amendments to the law. Firstly, the employment relationship is declared void when a dispute over wrongful termination, meaning the employer no longer must pay the regular wages in anticipation of a court decision. The employee can instead recieve economic support from the regular unemployment insurance. Additonally, the fines were increased to SEK 135,000 for general damages, and in the event of an unlawful dismissal to SEK 190,000. It is still up to the courts to decide in their case law how large the increase will be in general damages for invalid terminations and dismissals. These changes are in effect since 1 October 2022.
One of the most common reasons for declaring a dismissal void is inadequate documentation by the employer.
The reform of the Employment protection act in 2022 changed practices in cases of disputes about dismissals. If a dismissal is annulled, the employment will end after the end of the notice period, rather than last until the dispute is finally settled, which is the current practice. Thus, the employer will not have to pay wages during the entire dispute period. Instead, the dismissed employee may seek support from the unemployment insurance fund and, if the employer is bound by the main agreement, a supplementary collectively agreed unemployment insurance fund, which together correspond to 80% of the employee's salary. The changes entered into force on 1 October 2022.
Eurofound (2015), Sweden: Effects of non-compliance with dismissal regulations, Restructuring legislation database, Dublin, https://apps.eurofound.europa.eu/legislationdb/effects-of-non-compliance-with-dismissal-regulations/sweden
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