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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For a termination due to redundancy to be justly caused, the employer is obliged to investigate the possibility of internal redeployment to vacant positions within the company.
Under the previous law, amended in 2022, the rules stipulated that if any vacant position exists, the employer must offer it to the employee if this is reasonable. If there are no possibilities of redeployment to vacant positions, the order of priority for the redundancies is based on seniority, i.e. a last-in-first-out principle. Under the new rules, the last-in-first-out principle must also be taken into account when redeploying workers with similar tasks within the same operational unit. Workers with the shortest period of employment will be offered a position with fewer hours first.
The employer is also obliged to inform the concerned trade unions. However, there is no specific obligation to consult on the alternatives to dismissals.
An example of a conflict which highlighted the difficulties in determining what constitutes a dismissal and what constitutes a redeployment took place in 2015, where employees at a supermarket in Örebro were given new employment contracts with fewer weekly working hours. The workers felt pressured to sign the new contracts and the case eventually ended up in the labour court. According to the Commercial Employees' Union, the workers were in effect dismissed, and that the order of priority rules should have been complied with. But the employer argued that the workers were only redeployed, and that therefore no consideration to the order of priority rules had to be paid. The labour court ruled in favour of the employer.
The ruling has sparked a fierce debate as many unions feared that, as a result, employers would start 'redeploying' workers systematically in order to reduce their working hours. This fear was meant to be adressed in the social partner agreement on changes to the Employment protection act.
Eurofound (2015), Sweden: Obligation to consider alternatives to collective dismissals, Restructuring legislation database, Dublin, https://apps.eurofound.europa.eu/legislationdb/obligation-to-consider-alternatives-to-collective-dismissals/sweden
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