Sweden: Fines for Illegal Employment Doubled

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By Marcus Hoy

Expanded workplace inspections and tougher sanctions against the illegal employment of foreign nationals will go into effect June 1, a Justice Ministry official told Bloomberg Law Jan. 18, a three-month delay from the original effective date of March 1.

Under existing rules, law enforcement authorities can only carry out workplace inspections when specific information exists indicating a company is employing workers without a residence permit or the right to work in Sweden. The amendment will enable the police to conduct random raids within sectors where the employment of illegal workers is “concentrated,” such as the hotel and restaurant sector and other service industries.

The amendment will also double “administrative fees” that can be imposed on companies found to be in breach of the work permit rules. Separate from other types of sanctions, such as custodial sentencing and fines issued by the courts, the administrative fee is a special fine imposed directly on employers who employ illegal workers. Under both current and new rules, the size of the fee is based on the “price base amount” set by the Swedish government annually and linked to the consumer price index. The PBA is currently 45,500 kroner ($5,650).

The standard fee for companies employing a person without a valid work permit is currently half the PBA—22,750 kroner—which will rise to 45,500 kroner under the new rules. If the violation exceeds three months, the maximum fee is currently 45,500 kroner and will rise to 91,000 kroner under the new rules.

‘New Tools'

“The existing rules limit the ability to effectively ensure that employers do not exploit foreign workers,” the Justice Ministry official said. “These new rules will provide the police with new tools with which they can carry out their existing duties in a more effective manner.”

“The legal proposal will not entail any change to the mandatory requirements imposed on companies employing third-country nationals, such as documentation and salary requirements,” Bird & Bird attorney Dasha Garfur told Bloomberg Law Jan. 18. “Accordingly, companies that are compliant with the Swedish work permit requirements should not expect any additional costs as a result of the proposed amendment.”

“All companies should ensure that the employees have a valid work permit before employment commences, and prescribed documentation should be retained for a period of at least 12 months after the employment has ceased,” Garfur added.

To contact the reporter on this story: Marcus Hoy in Copenhagen at correspondents@bna.com

To contact the editor responsible for this story: Rick Vollmar at rvollmar@bna.com

For More Information

The amendment is available in Swedish here.

For more information on Swedish HR law and regulation, see the Sweden primer.

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