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Employer of Record in Sweden

Employer of Record in Sweden

An employer of record in Sweden, sometimes abbreviated EOR, is a company or organization that takes on the responsibility of being the official employer for tax and legal purposes on behalf of another company.

Investors interested in company formation in Sweden, as well as foreign companies looking to expand to the Nordic country, can rely on the assistance provided by our local team of company registration agents who can also handle the employment of record matters.

The use of an EOR in Sweden allows companies to make sure that payroll in Sweden, as well as the administrative issues regarding their employees, and compliance with the employment laws, are all being observed accordingly. This service can be outsourced by all types of companies, however, it may be more common in the case of large businesses with a higher number of employees.

The role of the employer of record

A foreign company that sets up a permanent establishment in Sweden will need to handle different employment matters as soon as possible and as efficiently as possible in order to start its business operations in due time. The same applies to investors who are interested in company registration in Sweden and plan on opening a local limited liability company that will need to hire employees.

The employer of record in Sweden is another company that will handle essential employment matters for the Swedish branch or subsidiary, or for the Swedish LLC interested in hiring staff. By handling the employment contract, as well as labor law matters for the staff, the EOR in Sweden will essentially become the legal employer. By working with an EOR, businesses can streamline their operations, reduce administrative burden, and focus on their core activities.

An employer of record in Sweden offers a complex set of services that are not commonly offered by a staffing agency. While a company in Sweden may choose to work with both of these service providers, the benefits of hiring an employer of record can be explained in more detail by our team.

Our team can assist investors who wish to open a company in Sweden, but also those who wish to outsource the management and processes related to hiring employees.

Services provided by an employer of record in Sweden

A company that uses employment of record services will essentially outsource aspects of employment and employee management issues. The provider of these services will handle multiple procedures, and the specific steps needed to hire local and foreign talent in Sweden.

Our team summarizes some of the most important issues handled by an employer of record in Sweden below:

  • labor law compliance: the EOR makes sure that the company abides the Swedish employment laws; in some situations, the EOR can also handle work visa matters;
  • essential documentation: the EOR handles the drafting and vetting of the employment agreement, as well as essential matters related to employee tax paperwork;
  • compensation and benefits: the employer of record is also the one to deal with the management and the administration of the various benefits that are offered to the employees;
  • employment termination: as needed, the employer of record will also handle the termination of the employment agreement.

Please note that this is not an exhaustive list. Working with an employer of record in Sweden allows companies to access the needed support when they wish to expand their workforce, as well as when they need to make sure that employment matters are properly taken care of.

Swedish labor statistics

According to Statistics Sweden, the business sector accounts for 70.8% of the proportion of gross pay. Other labor-related data shows that:

  • the labor force rate for February 2024 was 74.5%;
  • the employment rate was 68.1%;
  • the unemployment rate in February 2024 was 8.5%.

If you would like to know more about this solution, as well as the steps needed to set up a company in Sweden, you can contact our team.