Sweden reduces virus impact on employees, businesses

Several of the economic measures presented by the Swedish Government, the Centre Party and the Liberal Party to mitigate the impact of the coronavirus outbreak will be reinforced, including reimbursement for the first day of sickness and central government responsibility for businesses’ sick pay costs. In addition, the ceiling for unemployment benefits will be raised from day 101.

A total of five measures are now being reinforced. The impact on public finances of these measures – which are based on an agreement between the Swedish Social Democratic Party, the Centre Party, the Liberal Party and the Green Party – is expected to be SEK 14.7 billion.

Higher ceiling for unemployment insurance benefits from day 101

It is proposed that the ceiling for income-related benefits from unemployment insurance funds be raised – from SEK 760 to SEK 1 000 per day – from benefit day 101 and onwards. This increase is temporary and will apply from 29 June 2020 until 3 January 2021.  The Government has previously raised the level of benefits for days 1 to 100. This measure will cost SEK 1.1 billion.

Extended reimbursement for the first day of sickness

It is proposed that reimbursement for the first day of sickness, which originally would have applied until 31 May, be extended for four months until 30 September. The standard compensation will also be increased by SEK 104 from 1 June. This means that from that date, a person who has been sick and has had the standard deduction for sick days taken from their pay can apply for the standard compensation of SEK 804 from the Swedish Social Insurance Agency. This measure will cost SEK 3.2 billion.

Continued suspension of medical certificate requirement

It is also proposed that the suspension of the medical certificate requirement be extended until 30 September to reduce the pressure on health care services. The temporary rules mean that a person does not need a medical certificate to verify their sick leave for the first 14 days of sickness in order to receive sick pay or sickness benefit, compared with the ordinary rules requiring that a medical certificate be provided from the eighth day of sickness. This measure will cost SEK 1.1 billion.

Central government responsibility for sick pay costs extended and adjusted

It is proposed that the state aid to cover businesses’ sick pay costs be extended as it was for April and May so as to also include June and July. From 1 August until 30 September, central government will compensate employers for higher sick pay costs due to the COVID-19 pandemic. The Government is currently preparing the details of the proposal. This measure will cost SEK 9 billion.

Continued compensation for sole traders in case of sickness absence

It is proposed that the financial support to sole traders who are sick be extended from 31 May until 30 September. Under this initiative, sole traders with an F-tax card are entitled to standard compensation of SEK 804 per day for days 1 to 14 of their sickness period. This measure will cost SEK 250 million.

Swedish Government