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Swedish Unions Gain at Temporary Work Agencies

Posted to the IUF website 21-Jul-2004

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Sixteen Swedish unions belonging to the national center LO have negotiated an important agreement with ALMEGA, a large organization of service companies which also groups many of the country's temporary employment agencies. The IUF-affiliated white-collar union HTF has negotiated a similar, separate agreement for its members with ALMEGA.

The new system is binding for all ALMEGA employment agencies, who must now be licensed by a joint LO/ALMEGA board which requires the existence of a collective agreement as a condition (among others) for authorization. According to union sources, the average length of "temporary" employment through these agencies has increased in recent years from 16 to 40 months.

The LO agreement contributes significantly to reducing wage differentials, as it adds SEK500 (roughly USD67) monthly to the lowest paid and also gives a SEK500 across the board increase for all employees. It guarantees a minimum salary for all temporary agency employees of at least 90 percent of the average income earned over the past 3 months.

Getting a grip on the temporary agencies has been an important goal for the Swedish labour movement, and this agreement brings significant gains. An important clause in the HTF agreement stipulates that any deviation from full-time employment must be agreed to by the union concerned. In the new system established by the agreement, all new employees are guaranteed 133 hours' payment from the first day (as against 125 in the earlier agreement. The guarantee increases to 150 hours after 18 months. After 18 months, pay for all hours worked over 150 is increased by 16 percent.

Through the licensing agreement, the unions are working together with ALMEGA to isolate employment agencies working to undercut wages and working conditions.