Critically Analyze the Management of the Employment Relationship in Sweden.

Critically Analyze the Management of the Employment Relationship in Sweden.






Critically Analyze the Management of the Employment Relationship in Sweden.


Globalization trends have increasingly led to the diversification of the work environment. More than ever, relevant stakeholders are being compelled to provide viable wok environments in order to enhance employee performance. In other words, the welfare of the employee is increasingly assuming a central position in economic productivity. Yet despite this realization, various countries and economies continue to grapple with poor employment relationships. These in return have had an adverse effect on economic performance and holistic wellbeing of such states.

Nevertheless, there are certain states that have laid great emphasis on the need to provide sustainable work environments and maintain viable employee relationships. Notably, productivity in such states is seemingly exemplary. This can be attributed to their inherent ability to not only attract but also maintain employment and empower the employees. Over time, such states have been employed as ideal models in management studies. One such state whose employment relationships have been considered to be of exemplary quality on a global scale is Sweden. It is against this background that this paper provides a critical analysis of the management of employment relationships in Sweden.

“Employment relations” is a concept that has gained increased popularity within the global sphere. Essentially, it is all inclusive and denotes all aspects that are related to employment re-sourcing. In particular, it entails acquisition, development, maintenance and motivation of staff. In the Swedish context, Wheeler (2002) indicates that it expands beyond this and covers the various processes that the staffs are involved in once they quit employment. Notably, effective management of all these processes goes a long way in enhancing employee relations. It also contributes significantly to the improvement of the work environment as all factors that affect employees are addressed effectively and in a timely manner. Sweden has been considered to provide the best work environment on a global scale. In addition, its educational programs and materials, research practices and work life have been cited by Swenson (2002) to be remarkable. This distinctive status can be attributed to various systemic elements that make this country to thrive in this sphere.

Fahlbeck and Sigeman (2001) lists them as progressive and strong unions that not only participate in cooperate social responsibility initiatives but initiate various programs that are geared towards improving the work environment; sophisticated industrial relations that enhance the process of decision making and implementation of policies by mainstreaming information flow; the economic policy that advocates for full employment and plays a critical role in improving the working conditions; democratic governance that maintains an orientation that is sympathetic towards improving employee status and maintaining occupational health as well as safety; sustainable and growth oriented economic policies that advocate for continued improvement of industrial production and effective legislation that seeks to improve the entire work environment.

In order to attain this desirable state of affairs, social partners have made significant contributions. Basically, Neal (2000) defines social actors as the representatives of employers and employees in a wok environment. In Sweden, these are represented by union leaders and employers in several sectors. They partner with the government in making policies that govern the cooperate sphere. This entails formulation, implementation and enforcement of various labor policies that govern employment. Social partners in Sweden also participate actively in training employees and sponsoring job creation programs. Finally, Traxler (2003) indicates that they also participate in the process of collective bargaining.

At this point, it can not be disputed that these parties play an integral role in improving the work environment and enhancing the wellbeing of employees. However, it is worth appreciating that the role that these parties play particularly in the implementation and enforcement of laws and policies is informal. More often than not, the entire interests of the employees are seldom taken in consideration. Put differently, the process in some instances is highly subjective. Perhaps the success of Sweden in this regard can be attributed to the emphasis on organized interests. With regard to their participation as sponsors and or trainers, it can be argued that the private sector plays an important role in attaining this goal. This is because in the long run, the required benchmarks that determine standardization often need to be approved by respective employers (Elvander, 2002).

The role of the state in Swedish system of employment relations can also not be understated. In this context, a state is also referred to as a country and it constitutes a political entity that is self governing (Kilkaver, 2002). As a country that is governed by social democracy, the Swedish government is compelled to enhance the empowerment of all its citizens. The constitution provides the required rules as well as regulations through its well defined system of laws. The main aim of these is to facilitate progress, address all grievances and ultimately maintain harmonic living. The state plays an important role of initiating bilateral relationships between employees and employers. This is essential for mutual and healthy existence. In addition, Bamber, Lansbury and Wailes (2004) indicate that it enhances cooperation between these stakeholders and ultimately improves progress. In other words, through its ability to formulate, implement and enforce specific laws and regulations, the state participate it resolving conflicts between different agencies.

However, it should be appreciated that regardless of the inherent efforts and good intentions of the state, some parties still face challenges when resolving their problems. It is for this reason that the particular laws are mainstreamed within the legal constitution. In essence, the state offers all viable mechanisms through which conflicts can be effectively resolved and progress guaranteed. Attainment of this ideal state requires an effective form of governance, judiciary and management. In their review, Ferner and Hyman (2001) ascertain that Sweden seems to have mastered the art of effective governance and management at all levels. It is because conflicts are minimal and the government is dedicated to ensuring that all required mechanisms are provided in a timely manner. Besides, it plays an instrumental and non partisan role as an oversight body. The characteristic value system can be attributed to the ideal education system that instills these values at tender stages.

Equally important in this respect has been the role of collective bargaining. According to Tuselmann and Heise (2000), it refers to a decision making process between the representatives of the various interests of the employers and employees. The main aim of these is to negotiate and continually apply the agreed rules that govern the employment. Basically, the respective rules are usually established by the labor law. However, governments in some case make interventions whenever the labor-management relations experience problems.

The role of collective bargaining is to agree upon certain rules and regulations that facilitate compromise between the various conflicting interests over the conditions as well as terms of employment. From a historical point of view, institutions are often created to represent the interests and positions of the workers. Arguably, collective bargaining has played an important role in introducing and maintaining democracy within the work environment. This is because of its ability to bring to the fore and effectively analyze the varying interests of the involved parties. Further, the fact that a mutual agreement is arrived at in the long run implies that the process is sustainable. Basically, this has been instrumental in curbing manipulation that is typical of unsustainable work environments.

However, it is worth noting that work environments continue to experience challenges that stem form asymmetrical bargaining strength that is existent in the market economies. This has culminated in differences in employee and employer preferences during the bargaining process. In this regard, while employees derive distributive, protective and voice function form the process, employers aim at maintaining personal employment relations. The fact that they look forward to having a more bargaining power over the former perpetuates the differences. Also worth mentioning is the realization that employers tend to perceive the process as time consuming. All these concerns undermine the collective bargaining process. From Swenson’s (2002) point of view, the emphasis on the need for collective goods by both employees and employers provide a viable option for bridging the inherent complexities. While political will is essential, this requires dedication and commitment by all stakeholders.

As indicated afore, Sweden has an exemplary model of employee relations on a global scale. Pertinent to this is the concept of industrial democracy. Befort and Budd (2009) define this as an idyllic arrangement that ensures that workers or employees participate actively in making decisions. They are allowed by the system of governance to share responsibility as well as authority at their respective work places. Examples of this mode of arrangement are presented by Germany that accords the shareholders and workers an equal opportunity to elect the members of the directorate which constitutes the management. In general, industrial democracy refers to the ability of a given company to give the workers a chance to participate directly in governance (Honeyball, 2008). This is characterized by effective and clear communication within the organization. This is also attained through intensive consultation and effective representation of all stakeholders and shareholders at the managerial level.

Sweden has assumed this ideology in its employment relations on a significant level. Relative policies are employed in ensuring that workers or employees have quality employment that is characterized by sustainable work environments. According to Selwyn (2008) effective communication and free flow of information provides an ideal approach that the country assumes in attaining the underlying goal. Overall, workers are given a chance to participate actively in operating enterprise. In addition, industrial democracy in Sweden is defined by a spirit of cooperation as well as semi-autonomous work teams. The managerial teams cooperate with the employees in execution of key operations.

Also worth mentioning is the fact that firms in Sweden incorporate workers in managerial positions. In this regard, Ewing, McColgan and Collins (2005) ascertain that workers in Swedish firms assume top positions particularly as board of directors. In order to enhance competence and overall output, worker directors are given formal training about the tasks that are executed by the directors. This enables them to participate actively in management. Besides this, they are allowed to spend sufficient time with other directors in order to gain experience in the field. Unionization and the adoption of relevant legislation have further enabled the country to attain a high degree of democracy within its labor relations. The adoption of a labor policy that sought to improve the working conditions of employees was particularly effective in enhancing industrial democracy.

The reduction of the income gap between workers in the formal and informal sector can also be considered imperative attaining quality employment. The Swedish government attained this through establishment of large over-laps within pay scales. The government also put in place various initiatives that were geared towards improving the overall quality of life of the citizens. Notably, this was a requisite for enhancement of democracy. Thus areas that were outside the work environment such as social security, education and National Health Insurance were also improved. Of great importance was the enhancement of democracy within the political sphere. This according to Deakin and Morris (2005) was instrumental in promoting employee influence outside the work environment.

At this point, it can be ascertained that industrial democracy in Sweden has taken root. This can e attributed to the entrenchment of the ideology in legal domains. Arguably, it has put the government on toes with respect to the need to maintain transparency and accountability. However, inefficient enforcement of this ideology has contributed significantly to incidences of unemployment in the recent past. Walker and Morell (2005) indicate that the social welfare system and mode of government have in some instances negatively affected the wellbeing of employers. Nonetheless, the extent of this ideology in employee relations in the country remains pervasive.

Unionism is an important aspect of labor relations in Sweden. The trade union movement consists of a significant 2.1 million members and basically represents workers in the informal sector. Then, the Swedish Confederation of Professional Employees has 1.3 million members and represents workers in the formal sector. Further, the Swedish Confederation of Professional association represents professional employees with graduate qualifications. It has a total of 479,000 members (Teicher, 2006). The unions play an integral role in addressing a wide range of employee issues and concerns in a bit to improve working conditions. Particular issues according to Nankervis, Chatterjee and Coffey (2006) include negotiation of salary and negation of intrinsic disparities regarding the formal and informal workers and ensuring maintenance of acceptable work conditions. Normally, such procedures tend to be compounded by various complexities. However, the Swedish experience has been smooth because of the availability to legislation that governs the procedure.

Recent research ascertains that the unions in this country have the highest level of representation on global scale. Seemingly, this has been contributed to by the encouragement of volunteer membership. In addition, the fact that the unions and employees mutually benefit from the employee relations is an idyllic feature of Swedish employment. Unlike unions in other countries, Swedish unions have been cited to be highly organizational. Besides, they do not involve themselves in political and or religious confrontation that is responsible for fragmentation. This can be used to explain why the country has been successful in maintaining unionization and ultimate viable employee relationships. Basically, unionization can be considered an important feature of the Swedish employee relations. Most importantly, the procedures it employs have contributed significantly to the current desirable status of the country.

Equally instrumental has been the role of employers in the management of employee relationships. In their consultative research, Anxo and Niklasson (2006) cite examples of employers to include the General Employers Group, The Association of Swedish Engineering Industries (VI), The national Agency for Government employers, The Association of Local Authorities, The Federation of County Councils, The Construction Group and The Commercial and Service Employer’s Association. The employers play various roles in enhancement of work environment and improvement of the quality of life of the Swedish population. Together with the unions, they play a leading role in resolving the various problems that face the employees. Besides offering employment opportunities, Cornfield and Hodson (2002) indicate that they participate actively in formulation of policies that promote the wellbeing of the employees.

However, different concerns have been identified with regard to the role of employers in enhancing the work environment. Notably, they have used this position to further their personal interests. This has been particularly common with incidences where neither the government nor the union is involved. However, in most instances, Blanpain and Dickens (2008) argue that they have been compelled by the law to assume sustainable practices. All the same, incidences of manipulation of employees by this group of individuals can not be completely ruled out. The privatization of industry has further played a role in perpetuating manipulation especially during employee recruitment and employment.

Of great significance and reference to the management of employee relations in Sweden is the Swedish Model. It is an ideology that represents outstanding and ideal industrial relations as well as a well balanced social and economic structure. According to Myrdal (2009), it can be defined by a free market economy that functions properly and in which a significant 90% of the commercial and industrial sector are privately owned, free and independent yet competing enterprises that have rationalized and developed over time in collaboration with their workers, a labor market that is fully organized whose two sides are completely independent of one another and of the government, which resolve their conflicts autonomously and in a peaceful way but which still value corporate social responsibility, a well developed system that allows active participation of employee sin management, friendly cooperation and enterprises that enjoy a pragmatic and peaceful atmosphere that is also compromising.

Research indicates that these conditions provide a true picture of what constituted the model a couple of decades ago. Because of various transformations in the field of labor relations, a new Swedish model has been adopted. Thus it can be argued that the model is still in existence although it has also undergone different changes, in line with the political transformations and reorientations. Ultimately, this has led to the development of a model that is flexible and which reflects the dynamics in the economic and employment sectors. In this consideration, it can be ascertained that the respective changes significantly reinforce the traditional Swedish model and social cohesion.

In order to attain optimal growth and development in future, the Swedish system of employment relations needs to address certain shortcomings. In particular, it needs to improve its pension system to reflect the rising expenditures, address the increasing tax pressure and address the issue of unemployment (Cornfield & Hodson, 2002). Nonetheless, the future of the country is prospective. This is particularly because of the inherent stability, growth and development that characterize the entire system. It is likely to enable Sweden to soar economically and attain the highest degree of economic stability. This is essential as it boosts the country against the economic shocks that compromise sustainable development.


At this juncture, it can be ascertained that the Swedish system of managing employment relations is idyllic. This can be attributed to the assumption of various elements that seek to enhance the quality of life, social cohesion, industrial democracy and viable work environments. Specifically, industrial democracy has ensured participation of workers in management and therefore enhanced transparency and accountability. These are undoubtedly essential for economic growth and prosperity. As it has come out from the study, unions play an integral role in addressing diverse issues that affect the employees. The effective and autonomous nature of unions has equally been instrumental in promoting sustainable work environments. Likewise, the role of employers in contributing to the state of affairs can not be underestimated. Particularly, their active participation in policy formulation and providing of employment opportunities is important. Regardless of various shortcomings, it can be concluded that the country has been successful in managing employment relations.


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