Employer of Record Services in Sweden - A comprehensive guide

Over the last three years, many of us have realized that the world is much smaller than we thought. Most companies have had to adapt in some way during the pandemic and the result has been a shift towards remote working or a hybrid model, which is becoming more and more normal. Another benefit is that we now know that we don’t have to limit ourselves to a specific geographic area when recruiting. See more about Employer of Record Services in Sweden.

It’s now easier than ever to expand your operations to new locations, tap into available talent pools and do business in international markets. One country you should definitely add to your list of potential exploration avenues is Sweden.

Sweden has an impressive economy that is rich in a highly skilled workforce with a knack for innovation and creativity. The country is conveniently located geographically between the US, Europe and the UK and is constantly in the fast lane in a number of industries.

If you’re looking to expand to Sweden or hire an exceptional workforce there, you may need help setting it up. This is where an Employer of Record can be a lifesaver, but what is it? How should you use one in Sweden? How do you find one? Read on to find out more.

What is an Employer of Record?

An Employer of Record (EOR) is basically a third-party company that can take over most (if not all) tasks related to employment. An EOR is able to handle cost accounting, payroll, taxes, onboarding, contract negotiations, and anything else that has to do with an employee.

Using an EOR is beneficial for companies and employers. They can spend more time and energy on their business than if they had to set up the infrastructure in a new country to take care of all employment matters themselves.

Using an EOR is smart outsourcing. It’s no different than hiring a third-party company to clean your building or take care of your customer newsletter.

Do you need an Employer of Record service in Sweden?

You don’t have to use the services of an EOR if you want to work or staff in Sweden, but it can make things a lot easier.

How you can use the services of the Employer of Record in Sweden ?

As mentioned above, you are not obliged to use the services of the Employer of Record when hiring staff in Sweden, but there are certain circumstances in which an EOR will definitely give you an edge over your competitors.

No local Incorporation

Even for the most innovative teams, it can be difficult to get things rolling in a new country without a local incorporation. Setting up a local company can take a long time, cost a lot of money and in some cases is simply not necessary.

By using an EOR, the need to set up a local company can be completely eliminated. The end result often feels more like the new country is a new branch of the parent company, just very far away.

Laws and regulations

Even if you want to expand to a country that is part of the EU, there are still laws that only apply in Sweden.

It can be difficult and even overwhelming to deal with the business and labour laws of other countries. This can also be linked to various cultural differences. Not everything is always available online; some countries prefer to do everything digitally, others still work with paper.

Using an EOR will save you the headache of dealing with these legal issues yourself, while also ensuring that your company doesn’t inadvertently break the law because you didn’t read the fine print.

Payments and payroll

All businesses are keen to avoid any kind of disruption to the payroll payment cycle, and this can be particularly important when you’re dealing with international workers.

Hiring an employer of record to manage payroll for your expatriate employees can take a lot of the sting out of the equation. EORs know how to run the entire payroll cycle according to the laws of the country in question, as well as the cultural specifics involved.

Time and effort

Time is often the most precious commodity in business. If your company has decided to make the most of the talent pool available in Sweden, you probably want to do it now and not in two years' time.

EORs can take you from the idea of running a project in Sweden to implementation incredibly quickly. They already have structures in place locally, so all you need to do is provide your details and get the ball rolling.

This can save months, which in the business world means a whole lot of money.

What is the difference between an Employer of Record in Sweden and a Global Employment Organisation?

EORs are often used as part of a larger Global Employment Organisation (GEO) plan. A GEO service helps companies of all sizes to mobilize their personnel in another country. The GEO complies with all national and local labor regulations, taxes and work permits. GEOs sometimes also use an EOR to handle payroll for their employees.

For a company that utilizes an EOR through a GEO service, the GEO serves as a single point of contact. An EOR can also be used as a stop-gap measure while a local entity is being established.

What are the benefits of working with an EOR (Employer of Record)?

If a company is growing internationally without already having a local presence in the new country in which it operates, an EOR can be incredibly helpful. In the host country, the EOR is legally responsible for handling payroll, taxes and immigration.

An Employer of Record can also assist you with hiring international talent, conducting background checks, monitoring benefits and performing various administrative tasks.

By using an EOR, companies can get up and running faster without risking compliance. Utilizing an EOR is also a very convenient and cost-effective option for small businesses.

What factors should I consider when choosing an Employer of Record?

Most Employer of Record organizations offer similar services, but it is important that you choose an employer that you feel most comfortable with.

Don’t rush the decision-making process, but consider the following questions before making a choice.

Is there an office in the country you want to go to? Each Employer of Record has a different level of experience in different countries. Ideally, the EOR will have extensive experience in the country and be familiar with local conditions.

Do they comply with local labor laws on a global level? The biggest benefit of employing an EOR is that the risk of breaching local wage, tax and immigration laws is reduced. When selecting a provider, it is important that they have a thorough understanding of these laws.

Have they worked with other contractors in your industry? If the provider knows the industry, they can offer a customized solution that meets the needs of the business.

Will you be assigned a single point of contact or an online portal? You don’t want to be seen as a number with little human interaction while you are in charge of people.

Is the employer of record service an essential service for them? If EOR is just a side hustle, it will not be a top priority. This can have an impact on employee morale and performance.

Therefore, a global Employer of Record can be a cost-effective approach to hiring employees in this country. To manage payroll, employment duties and immigration locally, the EOR establishes a legal organization. In the host country, the EOR also acts as the legal employer for your remote employees.

What are the disadvantages of working with a registered employer in Sweden?

With the EOR structure, there is a legal employment relationship between the employee and the EOR. However, the EOR has no contact with the employee in relation to the employee's daily work tasks.

The original employer is responsible for this policy. Therefore, a disadvantage of using an EOR is that the lines of accountability can become blurred. This can be remedied by consistent communication in which it is explicitly explained to all parties involved who is responsible for what.

How to find an Employer of Record in Sweden ?

There are many companies offering EOR services in Sweden, and the most important thing is to find a company with whom you can establish and maintain a good working relationship.

The Swapp agency offers EOR services in Sweden as well as in Iceland, Finland, Norway and other countries. The agency was originally founded to connect the best remote workers in the Nordic countries with companies around the world who want to benefit from their expertise.

Today, Swapp has expanded its operations to many other areas of international business, including employer services. So if you are looking to expand to Sweden or take advantage of some of the incredible talent available there, contact Swapp today to find out how Swapp can help you.

Bottom line

It doesn’t matter how big or large your business is. If you are looking to expand into Sweden or the other Nordic countries, an Employer of Record service can save you time, energy and money.

The business world is constantly changing because the interconnectedness of everything is making it smaller. The playing field is becoming more even, which is an exciting time for those of us who have learned to work smarter, not just harder.