Sick pay
This is where you, as an employer, can read about how you can assess whether your employee is entitled to sick pay. You can also read about how to calculate sick pay. Entitlement to sick pay is primarily a civil matter between an employer and an employee.
What is sick pay?
Sick pay is what you as an employer must pay an employee who is ill. You pay sick pay for a maximum of 14 days. If the employee’s illness extends beyond this, he/she can apply for sickness benefit from Försäkringskassan. Sick pay replaces wages and any other employment benefits that the employee would have had if he/she had not been ill.
Entitlement to sick pay is regulated in the Swedish Sick Pay Act. This act is mandatory in favour of the employee. It is, however, possible to make certain exceptions to the act through collective agreements approved on behalf of employees by a central employees’ organisation. Central collective agreements may also be used for employees who do not belong to the employees’ organisation that concluded the agreement. This applies to employees who perform work referred to in the agreement and who are not covered by any competing collective agreement.
The Swedish Sick Pay Act (1991:1047) (riksdagen.se)
External link, opens in new window.
When an employee reports in sick
When an employee has reported in sick to you, you must assess whether the employee’s work capacity is impaired due to illness. You must also assess whether he/she is entitled to sick pay.
Medical certificate if the employee is ill for more than seven days
If the employee is ill for more than seven days, he/she must prove that his/her work capacity is impaired. He/she does this with the aid of a certificate from a doctor or dentist. The medical certificate does not need to contain details of the employee’s illness. In some cases, collective agreements may decide that the employee must provide a medical certificate earlier than the eighth day, and that you as an employer can request that the certificate contain details, such as the illness.
The employee must confirm the absence with a written declaration
The employee must confirm that he/she has been absent due to illness with a written declaration. The declaration must state that he/she has been ill and for how long he/she has been absent from work because of illness. It does not have to specify which illness has caused the employee’s work capacity to be impaired.
Some collective agreements require the declaration to contain additional information, such as which illness the employee has had. There are also collective agreements that contain other deviations from the provisions concerning the declaration. The declaration must be submitted no later than at the end of the period with sick pay. You are not obliged to pay sick pay until the declaration is submitted.
On the page about “Sick employee days 1-90”, you can read more about what you as an employer must do and what the employee must do.
Who is entitled to sick pay?
An employee may receive sick pay as of the first day of his/her term of employment if he/she
- has a fully or partly impaired work capacity due to illness
- has started his/her term of employment.
A person who is employed on a permanent basis or is to be employed for more than one month may receive sick pay from the first day of employment. A person who is to be employed for less than one month may receive sick pay when he/she has worked for at least 14 days.
It is your task as an employer to assess whether the employee has reduced work capacity due to illness, and if so to what extent.
As an employer, you do not have to pay a new period of sick pay in cases where the employee has already received sick pay for fourteen days during the current period of illness in a previous term of employment. This applies regardless of whether the new term of employment is entered into with the same or a new employer.
Contractors and self-employed persons (sole proprietorships or partnerships) are not entitled to sick pay. They can instead apply to Försäkringskassan for sickness benefit if they fall ill.
How to calculate sick pay
Sick pay constitutes 80 percent of the wages that the employee loses due to illness.
If the employee has a fixed salary, it is usually easy to calculate the sick pay. If the employee is paid on an hourly basis, sick pay must be calculated and paid for the time that he/she should have worked.
If the employee loses employment benefits, these must be included in the sick pay.
If the employee has benefits that he/she does not lose because of the illness, these must not be included. Such benefits might be, for example, free housing or car. Allowances for expenses that he/she only incurs when working must also not be included.
Sick pay must be paid to the same level by which the work capacity is impaired (1‑100 percent).
You must make a qualifying deduction from the sick pay. The qualifying deduction can be likened to an excess amount that must be deducted from sick pay. The deduction must be 20% of the sick pay that the employee is expected to receive on average during one calendar week corresponding to the number of many hours that he/she usually works.
For a person who works the same number of hours every day, five days a week, the qualifying deduction is thus equal to one day’s sick pay. But for a person whose working hours are distributed unevenly, the qualifying deduction can be both less or more than one day’s sick pay.
Example: Qualifying deduction for regular working hours
The employee works Monday-Friday, 8 hours a day. The salary is SEK 110 per hour. The employee falls ill and stays home all day Monday.
Sick pay per hour: SEK 0,80 x SEK 110 = SEK 88
Sick pay for Monday: 8 hours x SEK 88 = SEK 704
Average sick pay per week: 40 hours x SEK 88 = SEK 3,520
Full qualifying deduction: SEK 0.20 x SEK 3,520 = SEK 704
The employee receives no sick pay for Monday.
To calculate the average weekly working hours for a person whose working hours vary a lot, you can use information about how the employee worked during the time before the period with sick pay. It is important that the calculation of the average weekly working hours reflects the employee’s actual working hours.
The more variation there is in an employee’s working hours from one week to another, the longer the period for comparison may need to be in order to obtain a fair picture. In most cases, it is sufficient to look back from one to three months.
Example: Qualifying deduction for irregular working hours
An employee works according to the following weekly schedule:
Monday 14 hours,
Tuesday 5 hours,
Wednesday 5 hours,
Thursday 0 hours,
Friday 6 hours.
A total of 30 hours per week, which also corresponds with the average weekly working hours.
The salary is SEK 110 per hour. The employee falls ill and stays home all day Monday.
Sick pay per hour: SEK 0,80 x SEK 110 = SEK 88
Sick pay for Monday: 14 hours x SEK 88 = SEK 1,232
Average sick pay per week: 30 hours x SEK 88 = SEK 2,640
Full qualifying deduction: SEK 0.20 x SEK 2,640 = SEK 528
The employee receives SEK 704 in sick pay (SEK 1,232 - SEK 528) after a full qualifying deduction has been made.
You must always make a full qualifying deduction, regardless of whether your employee was absent for all of the first day or just part of the day. If a full qualifying deduction cannot be made from the allowance for the first day with sick pay, you must make the rest of the deduction the next day, until a full deduction has been made.
However, the deduction can never be greater than what could be paid as sick pay for the period with sick pay.
Some collective agreements have their own wording to describe how sick pay and qualifying deductions are to be calculated, based on industry and agreement provisions adapted to the type of work.
You can find more information at verksamt.se if you do not use a payroll system to calculate the qualifying deduction:
Calculate the qualifying deduction (verksamt.se) External link, opens in new window.
If the employee falls ill again
If the employee falls ill again within five calendar days, you must include the days in the previous period with sick pay in the new one, so that together they total a maximum of fourteen days. If you have made a full qualifying deduction in the previous period with sick pay, you must not make a new qualifying deduction in the new period. If, however, a full qualifying deduction has not been made, you must continue to make deductions in the new period until a full qualifying deduction has been made.
The employee can fall ill several times before fourteen days have been reached in the period with sick pay. If the employee has several employers, the period with sick pay must be calculated in this way separately at each employer.
If the employee falls ill again on the fifth day, and that day is a work-free day, this rule does not apply, as it is only when the employee is absent from work that the new period of illness commences. Instead, a completely new period with sick pay commences if the employee is still ill when he/she should have worked again. This is because more than five days have passed since the previous period of illness.
Example Period with sick pay when an employee falls ill again
Day of the week | Sick | Working Day (W), Free (F) | Day in period with sick pay |
|---|---|---|---|
Monday | S | W | 1 |
Tuesday | S | W | 2 |
Wednesday | S | W | 3 |
Thursday | S | W | 4 |
Friday | H | W | X |
Saturday | H | F | X |
Sunday | H | F | X |
Monday | S | W | 5 |
Tuesday | S | W | 6 |
... and so on |
You can claim compensation for high sick pay costs
Like all employers in Sweden, you are protected against high sick pay costs. This protection means that you as an employer receive compensation for the annual cost of sick pay above a certain level. You do not need to do anything to claim this compensation, it is handled automatically by the Swedish Tax Agency and Försäkringskassan.
