Academic journal article Nordic Journal of Working Life Studies

Swedish Collective Agreements and Employers' Willingness to Hire and Retain Older Workers in Employment

Academic journal article Nordic Journal of Working Life Studies

Swedish Collective Agreements and Employers' Willingness to Hire and Retain Older Workers in Employment

Article excerpt

1 Introduction

A rapidly ageing population is a challenge to many of today's societies, and Sweden is no different (Nilsson 2012). One challenge is to preserve social welfare when the elderly make up a larger proportion of the total population (Report from the Parliament 2013/14:RFR8). Labor market institutions require people above the age of 67 years to leave salaried employment. If these systems do not change, pension benefits will be unreasonably low and the stability of the pensions system will be threatened (Ds 2013:8; Kruse 2010). Allowing people to work beyond the current retirement age limit can help slow the growth of the maintenance burden for welfare costs (Bengtsson and Scott 2010; Kadefors and Johansson Hanse 2012; Staubli and Zweimuller 2011). However, a prolonged working life presupposes several conditions; labor market regulation, including collective agreements, must promote this development and employers must be willing to hire and retain older people in their businesses. An international study by Manpower shows that of the companies surveyed, Swedish firms were the least prepared to give older workers employment or retain older employees in work (Manpower 2007). The Equality Ombudsman (DO) confirms in a report that older employees are discriminated in the Swedish labor market and that recruitment situations are particularly discriminatory in this respect (DO 2012, see also Kadefors 2013). Against this background, it is interesting to investigate whether-and in what way-Swedish collective agreements support employers' willingness to hire and retain older workers.

The Swedish Employment Protection Act (SEPA 1982:80) provides currently employed workers with protection. When terminating an employment, the employer must demonstrate just cause for termination and when choosing among employees for termination, the employer must also comply with a specified order of selection for termination. The labor market in Sweden is regulated to a large extent by collective agreements. This means that in many aspects, labor market parties can complement and replace parts of the current legislation, such as the order of selection for termination (22 § SEPA) through regulation in collective agreements. About 90% of all employees on the Swedish labor market are covered by collective agreements (Swedish National Mediation Office 2013). Collective agreements may exist on several levels; some agreements are valid for a special sector and some are central, cross-industry collective agreements (so-called main agreements).

One welfare regulation in Sweden is the pension system. An employee's pension can consist of a statutory pension, a collective agreement-based pension, and possibly the employee's private pension provisions. There are four major collective agreement-based pension schemes for the Swedish labor market, and these occupational pensions in collective agreements are important complements to the general statutory pension scheme (Statistic Sweden 2012 Transition from work to retirement). These agreements cover civil servants, municipal and county employees, and white-collar workers and bluecollar workers in the private sector, respectively. There are also collective agreements in the form of transition agreements which cover all sectors of the labor market (private and public, blue-collar, white-collar, and professional employees). The transition agreements are an important complement to the statutory employment protection regulation on redundancy dismissals (see Walter 2015; Rönnmar 2014).

Approximately 90% of Swedish employers have no strategy to hire or retain older workers (Ds 2013:8). Combined with regulation in collective agreements, attitudes and experiences among employers may affect access to the labor market for elderly persons and thus are important to examine in reference to Sweden's changing demography. The collective agreements represent a central regulatory instrument in the relationship between employer and employee, and these agreements should rest to a large extent on the norms that form the basis of Swedish labor laws and on values found in the Swedish welfare model. …

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