Glossary of Swedish working time and payroll terms
Eighteen terms that keep coming up in Swedish time reporting and payroll administration, explained briefly and linked to how Timply handles each one.
Why a glossary
Swedish payroll administration has a vocabulary of its own, and the words are not interchangeable. Additional hours and overtime are paid differently. Holiday compensation and holiday pay are two separate things. A time code is not the same as a payroll code.
Mix the terms up and the payroll record comes out wrong, and the error is usually found first by an employee reading their payslip. This list explains the eighteen terms that come up most often, and points at how Timply handles each of them.
Swedish terms kept in Swedish
Several of these keep their Swedish name here even in English, and that is deliberate. OB, PAXml, VAB, semesterlagen and karensavdrag are what the words are called in the systems, the agreements and the legislation you will actually be reading. Each page gives the English term and the Swedish one together, so a search for either finds the same answer.
Where a Swedish authority publishes its own English wording we use it: the Working Hours Act and daily rest from Arbetsmiljöverket, temporary parental benefit from Försäkringskassan, employer contributions from Skatteverket.
Working time and pay
Unsocial hours premium
An unsocial hours premium, OB in Swedish, is extra pay for work at inconvenient times such as evenings, nights, weekends and public holidays. It is set in collective agreements rather than in law, so both the hours that count and the rate differ between agreements.
Additional hours
Additional hours are the time a part-time employee works beyond their schedule but up to the full-time measure. They differ from overtime, which is time beyond the full-time measure, and most Swedish collective agreements pay them at a lower rate.
Overtime
Overtime is working time beyond ordinary working time, meaning beyond the full-time measure. The Swedish Working Hours Act caps how much overtime may be taken in a year, while what it is paid is set by a collective agreement or an employment contract.
Time off in lieu
Time off in lieu is overtime taken as leave rather than as money. It accrues with a factor set in the collective agreement, often so that one overtime hour gives more than one hour of leave, and is taken later as compensatory leave.
Daily rest
Daily rest is the unbroken time off an employee is entitled to in every twenty-four hour period. The Swedish Working Hours Act requires at least eleven hours, and the hours between midnight and five in the morning should normally fall inside the rest.
Weekly rest
Weekly rest is the longer unbroken time off an employee is entitled to in every seven-day period. The Swedish Working Hours Act requires at least thirty-six hours, and the rest should fall at the weekend as far as possible.
Working Hours Act
The Working Hours Act (1982:673) governs how much and when you may work in Sweden. It sets ordinary working time at no more than forty hours a week, caps overtime at two hundred hours a year, and requires daily and weekly rest.
Holiday
Annual Leave Act
The Annual Leave Act (1977:480) governs the right to holiday in Sweden. It gives at least 25 holiday days per holiday year, defines the holiday year as 1 April to 31 March, and sets the rules for paid days, saved days and holiday pay.
Saved holiday days
Saved holiday days are paid holiday days carried over to a later holiday year instead of being taken. The Annual Leave Act gives the right to save days beyond the twenty that must be taken during the holiday year, and saved days may not be saved for longer than five years.
Holiday compensation
Holiday compensation is money paid instead of holiday, usually when employment ends and the employee has earned days that were never taken. It should not be confused with holiday pay, which is the pay received during holiday that is actually taken.
Absence
Qualifying deduction
A qualifying deduction is the amount taken off sick pay when an employee is off sick. Since 2019 it has been a fixed deduction equal to 20 per cent of an average week of sick pay, which replaced the old qualifying day and makes the deduction the same whenever in the week somebody falls ill.
Care of a sick child
VAB stands for vård av sjukt barn, care of a sick child, and means a parent stays away from work to look after a child who is ill. The payment comes from Försäkringskassan as temporary parental benefit, not from the employer as sick pay.
Payroll and export
PAXml
PAXml is the Swedish standard format for moving time and payroll records between systems, maintained by SLA. A time system exports an XML file to the standard and the payroll system imports it. The current version is 2.0.
Payroll time code
A payroll time code says what kind of time an entry represents, for example hours worked, an unsocial hours premium, overtime or a particular reason for absence. In PAXml the field is called tidkodTYPE, and the code decides how the payroll system treats the hours.
Approval
Approval is a sign-off on a payroll record before it goes further. In payroll administration it means a manager has reviewed and approved time and absence for a period, so that payroll runs on a record somebody has taken responsibility for.
Employer contributions
Employer contributions are the charge a Swedish employer pays on wages and benefits paid out, on top of the wage itself. The full rate is 31.42 per cent of gross pay, with lower rates for certain age groups.
Agreements and technology
Collective agreement
A collective agreement is a written agreement between an employers' organisation or employer and a trade union on pay and terms of employment. In practice it decides premium levels, overtime pay, the number of holiday days and departures from the Working Hours Act.
Geofence
A geofence is a virtual boundary around a physical place, defined by coordinates and a radius. In time reporting it is used to check that a clock-in or clock-out really happened at the workplace.
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