Labor Legislation During the 1970S
School of Business
University of Alberta
T6G 2R6 CANADA
The following is based on:
It was characteristic of the 1970s that industrial relations issues that were
previously regulated by voluntary agreements came to be regulated by
legislation. Once fundamental economic and social rights had been achieved,
politicians became increasingly interested in labour relations and the unions
became increasingly political.
Fact Sheets on Sweden. Labor Relations in Sweden.
Published by the Swedish
Institute, January 2001.
Influenced by the leftist winds that blew in the late
1960s, the 1971 LO Congress adopted a wide-ranging, radical program calling for
greater union participation in company decision making and many other changes in
labour law. TCO adopted a similar program. As a result of these demands, many new labour laws were introduced,
mainly between 1972 and 1977. The main ones are described below.
First, however, a few words about the Labour Court (Arbetsdomstolen), which was
founded in 1928 and comprises the final -- and in most cases the only -- forum
for settling legal disputes on labour issues. Its members include
representatives from government, employers and unions. The court hears some 150
cases a year. There are no regional or sector labour tribunals.
The Security of Employment Act (LAS, 1974) increased the influence of the
unions. Dismissal of an employee must be based on "objective grounds".
Such grounds do not exist if it can be reasonably demanded that the employee be
moved to another job in the company. Older employees are entitled to longer
periods of notice than younger ones: those under age 25 get one month and then
the period goes up to six months for those 45 and over. (Collective agreements
may add further months to this, e.g. twelve-month notice of dismissal for some
employees over 55).
In 1982 an option to hire people on a trial basis for up to six months was
introduced. In 1994 this period was increased to twelve months, and employers
got a slightly larger formal say in deciding which employees to keep when there
are staff cutbacks. But in 1995 the previous regulation was reinstated.
Employers claim that the present "Last In-First Out" rules make it
hard for them to keep the employees they need and for young people to find or keep jobs. They have demanded changes
in labour legislation.
A 1974 act (Fortroendemannalagen, FML) entitles trade union representatives
to perform many union duties during paid working hours. Local union branches
decide which people are to be regarded as union officials and may to some extent
decide what hours they may devote to union activities at the workplace. A 1975
law increased opportunities for employees to be granted leave of absence from
work to pursue studies for long or short periods.
The Work Environment Act of 1978 increased the rights of unions to help
improve workplace health and safety. The concept encompasses work systems,
working hours and adaptation of work to human factors. Safety representatives
may halt dangerous work under certain circumstances. The tasks and
responsibilities of the safety committees are covered by agreements settled
between SAF member federations and LO/PTK member unions.
The 1980 Act on Equality between Men and Women at Work forbids an employer
from discriminating against an employee on account of gender. Men and women
shall enjoy equal opportunities for employment, training, promotion and
on-the-job development. They shall receive equal pay for work of equal value.
Since 1992 employers with ten employees or more are requested to draft annual
plans for their efforts in this field.
The Vacation Act of 1978 increased the statutory minimum paid holiday from
four to five weeks.
During the 1970s employee participation in decision-making at the workplace was a much-
debated topic. A long series of changes took place, some of them controversial.
Three levels of involvement were mentioned: shop floor, company and financial
Shop floor participation
aims to enhance the influence of individuals over their own work. Companies improved
the design of workplaces and job content, so as to create a better working
environment and increase opportunities for employees to influence their own job.
Company participation refers to the influence of employees over their workplace through
the unions. At this level, union representation in advisory bodies within
companies began when the SAF-LO and SAF- TCO works council agreements were
signed in 1946. These agreements were replaced in 1977 by the Act on
Co-determination at Work (MBL).
This act applies to all workplaces where at least one union member is employed. The
law regulates many issues settled earlier, such as the right of association and
bargaining, and rules concerning mediation and conciliation. The parts of the
law dealing with union influence on decision-making attracted by far the most
An employer is obliged to consult with local unions before implementing decisions
that involve a major change for employees in general or an individual union
member. If the parties fail to agree, the matter can be referred to a second
round of consultation at the national level. Only after that is the employer
entitled to make his final decision (regardless of whether the par- ties agree
or not). Employers that neglect these rules can be ordered to pay damages.
The employer also has an obligation to provide information. Unions have access to
virtually all company documents. In certain types of disputes, the view of the
union enjoys priority until the dispute has been settled in the Labour Court or
by other means.
At the request of a union, employee participation in decision-making can be
regulated further through a collective agreement. SAF, LO and PTK signed such a
supplementary pact in 1982. The main idea of this Agreement on Efficiency and
Participation is to delegate authority to foremen and individual employees. The
agreement served companies and employees well by bringing participation back to
Under another law (1973, amended in 1976 and 1988), local unions may appoint
representatives to the board of directors of most companies
with at least 25 employees (there is no balloting among employees). The unions
are entitled to two board members and two alternates. In companies with 1,000 or
more employees operating in more than one economic sector, unions may appoint
three members and three alternates. Union representatives may not hold a voting
majority on company boards. They have the same rights and responsibilities as
other board members, but on certain issues where e their union and the company
have interests that may conflict (such as pay bargaining matters) they are
disqualified from taking part in board meetings.
Financial participation, lastly, focused on the question of who should own companies. The 1976 LO Congress called
for the creation of “wage-earner funds", or union-controlled investment
funds. This issue became extremely controversial. Several models were presented.
Five regional funds were implemented in 1984, each with a nine-member board of
directors including five from the unions. Large amounts of money were collected from
employers and used for buying shares in private companies. Money was
collected to this system for seven years (1984 to 1990). The funds were
abolished as from 1992. The money which was collected is now used for various