Probationary employment could be extended due to absence during probationary period

An employee of the Swedish Social Insurance Office was on parental leave for the main part of his probationary period. Therefore, the employer found that the employee’s performance could not be evaluated and decided that the probationary employment would not transform into a permanent employment.

As a result, the employee claimed that he, among other things, had been disadvantaged in violation of the Parental Leave Act. In order to examine that question, the Labour Court found it relevant to decide whether it would have been possible for the parties to agree on an extension of the probationary period.

Parties may agree to extend the probationary period in certain cases

According to Swedish law, an employer cannot alone decide to extend a probationary period. Nor is it possible for an employer and an employee to initially agree on a probationary period that is longer than the maximum of six months, unless there is an exception in an applicable collective agreement. This is due to the main rule which states that parties cannot prematurely enter into a binding agreement, that revokes or restricts the rights of an employee under the Employment Protection Act.

However, it is possible to agree on deviating from the Act once the particular right has been actualized. Hence, the question in this case was whether the parties could have agreed to extend the probationary period during the ongoing probationary employment.

According to the Labour Court, there must be strong objective reasons for the parties to agree on an extension of the probationary period. In this case, the court found that there were such objective reasons, as the employee had been absent for the main part of the probationary period. It would therefore have been permissible for the parties to agree on an extension of the probationary period, corresponding to the period of absence.

Since the employer chose not to employ the employee permanently due to the lack of time for evaluation, even though an extension of the probationary period would have been possible to gain more time, the employee had been disfavoured in violation of the Parental Leave Act.

IUNO’s opinion

According to the judgement, an employer and a probationary employee may extend an ongoing probationary employment in compliance with the Employment Protection Act, if the employee has been absent for the main part of the probationary period. The extended period must then correspond to the period of absence.

IUNO recommends that employers are careful when terminating probationary employments or not transferring probationary employments into permanent employments, due to absence, as this may be deemed discrimination. In cases where the termination of probationary employees’ employments is found necessary, employers should be confident that their reasoning is valid, and ensure that it does not conflict with the law.

[Swedish Labour Court Case 53/2020 of 30 September 2020]