Before you as an employer go through with making changes to the organization that will affect the employees it might be a good idea to contact a lawyer for advice. If laboural procedural rules have been breached there is a risk of having to pay damages. We have written about some of the more common situations below. Termination due to labour shortage, reorganization of the company etc. Labour shortage is an umbrella term for the situation where an employee is terminated and the termination is not related to the employee personally. Common labour shortage situations are:

• Reorganizations of the business.
• Rationalization and optimizations of the business.
• Cuts in staff due to lack of profitability.
• Change of focus in business.

Labour shortage is a reasonable ground for termination if the procedural rules are observed and it is a serious business decision and not in violation with what can be considered good practice.

Relocation investigation
In a labour shortage situation the employer is required to investigate every reasonable possibility to relocate the employee before termination. The rules of priority (turordningsreglerna) in the Employment Protection Act (LAS) 22-23 §§ must also be considered.

Before the priority is set an employer with at most ten employees can except at most two employees which he considers to be exceptionally important to the continued business. The employee who has been excepted have a right of priority to be rehired. If the employer has more than one units of business, an order of priority is made for each of the units. However it is required that the employee is qualified for the job. An employee should not have a right to stay in a job he is not qualified to do. In order for an employee to stay in employment he/she has to be qualified for the job.

Co-determination and notice of termination
The rules in the co-determination in the workplace act (MBL) stipulates when the workers union shall be notified in decisions regarding their members. The 13 § of the law states that no collective agreement is needed for such a notice to be required. In the first part of the paragraph employers are obligated to negotiate in accordance with the 11 and 12th §§ MBL in decisions concerning the unions members regarding work or employment conditions.

Is there a collective agreement in place?
If an employer has entered a collective agreement with a union there are rules for how notice shall be given and how negotiations should proceed in MBL. The employer might be obligated to negotiate before making a decision, according to the primary obligation to negotiation in the 11th-13th §§ MBL. The primary obligation to negotiate is meant to give the employees an opportunity to give their opinion on important decisions that affect them. Read the collective agreement to see if there are rules about re-educational support etc. for employees who will be terminated because of labour shortage.

Termination-document, notice of termination
It is important that the termination document includes the correct information such as information for the employee on how he/she should proceed should the employee wish to challenge the termination. Furthermore the grounds for termination should be specified, e.g. termination because of labour shortage. Information on the right to be reemployed and when the employee needs to notify the employer of such an interest shall be included. How long the period of termination and when the last day of employment is should be included. The letter should clearly state if the employee is relieved from his duties during the period of termination.
The rules of MBL is part of most companies everyday business and is because of this integrated into the company decision process. It is however quite common that smaller size companies lack a HR-unit or similar competence to handle such questions. Non-compliance or disregard for the rules can make you liable for damages. It might be a good investment to ask a labour law lawyer preemptively or to have them write the required documents.

Termination due to personal reasons
Examples of situations that constitutes well founded grounds for terminating due to personal reasons are:

• Misbehaving
• Co-operation issues
• Lack of competence or perfomance
• Not showing up for work

Since the employer has the burden to prove that there is reasonable grounds for the termination it is important to keep good records of incidents to serve as evidence. If an employee is not doing his/her job he/she should be warned in writing and a meeting should be held with the employee. It should be clearly stated in the warnings that the employee is at risk of being terminated if the behavior is continued. Several warnings are recommended if it is a case of lesser incidents which collectively may constitute reasonable grounds for termination. If there’s documentation on the written warnings to the employee but that he/she has still not bettered him/herself action can be taken. Before an employee is terminated a relocation investigation must be performed. If the employee is a member of a union the employer may be obligated to negotiate. If the procedural rules are not respected the employer risks paying damages.

Reinforced employment protection (förstärkt anställningsskydd)
Some employees enjoy a reinforced protection regarding their employment and have a right to stay employed: Union representatives have a right to stay in employment if it is of particular importance to the union. Another prerequisite is that the union representative is qualified to fill a new position.

Employees with reduced abilities to work, and have a special employment, have a right, according to LAS § 23, to stay in employment if it can be arranged without serious inconvenience for the employer.




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