The Swedish model

The Swedish model, in Swedish "den svenska modellen", is a labour market concept where working terms and pay are agreed upon through collective agreements between trade unions and employee organisations without the government's involvement.^[1]

The idea is that workers agree to not strike while employers agree to not do a lockout. This means that everything is decided through cooperation and understanding without the need of the government.^[2] While some laws regulate basic labour rights, there is no law for minimal pay. A law-required wage would mean that companies could refuse workers a higher pay, with the Swedish model the pay is instead regulated through the agreement. Additionally, it would mean that a strike would be harder to do as the employer can claim refusal to work if the trade union went on strike for better pay.^[3] When a collective agreement is formed neither the trade union nor the employer is allowed to take any labour action until the agreement expires (usually up to three years) which is called industrial peace.^[4]

The two biggest trade unions are Landsorganisationen (LO) and SACO. Both are umbrella organisations with 34 trade unions in the lower and middle class such as bus and train drivers, constructions workers, teachers, industrial workers, engineers and more. There are multiple employee organisations but the main ones are Sveriges Kommuner och Regioner (SKR) and Svenskt Näringsliv who maintain companies in the public sector respectively the private and business sector.