SWEDEN Law and Practice Contributed by: Robert Stromberg, Advokatfirman Cederquist KB
Act. As a main principle, there are no limitations on confidentiality agreements in terms of time, but such an agreement may be considered unreasonable and unenforceable by a court if it is too burdensome for the employee. Non-disparagement clauses are not that common in Sweden, but the duty of loyalty includes a duty not to be disloyal towards the employer through dispar - agement. However, an employee has a right to put forward a critique of the employer when doing so is justified, as mentioned above. Employee Liability The main principle is that the employer is responsi - ble for all damage caused by the employee during employment. An employee is responsible for dam - age that an employee causes through fault or neg - ligence in his or her employment only to the extent that there are exceptional circumstances with regard to the nature of the act, the employee’s position, the interest of the injured party and other circumstances, according to the Tort Liability Act. Post-employment restrictive covenants regarding non-competition are valid under certain circumstanc - es. The main rule is that they must be reasonable, taking many different factors into account, such as whether employees receive some compensation for the restriction, whether the restriction is limited to certain companies, whether the restriction is limited geographically, etc. An overall assessment of all rel - evant factors has to be made in each individual case. Non-competition covenants should normally only be used for employees whose position in the company makes such restrictions necessary. In principle, the period of a non-competition covenant should not exceed nine months or, under certain conditions, a maximum of 18 months. According to CBAs and market practice, employers are obliged to pay approximately 60% of the monthly income from the employer as compensation for the 2. Restrictive Covenants 2.1 Non-Competes
inconvenience caused by the non-competition cov - enant. However, a general assessment of the reasona - bleness of a non-competition covenant must be made in each individual case, which means that other types of compensation may also be accepted as long as they are linked to the non-competition covenant. Non-competition covenants are normally combined with a contractual penalty, which must be reasonable in relation to the employee’s salary. Such a penalty is usually set at between three and six months’ salary for each breach. Restrictive covenants may also be combined with a continuing penalty, and the employ - er can be entitled to further damages if the damage caused by the employee exceeds the amount of the Non-solicitation covenants in relation to the solicita - tion of employees should typically not apply for longer than six months after the employment. A covenant regarding the non-solicitation of employees does not usually need to be combined with any compen - sation in order to be considered reasonable (unlike non-competition covenants), but should be limited, for example, to colleagues with whom the employee has worked. A general assessment of the reasona - bleness of a non-solicitation covenant in relation to the solicitation of employees must be made in each individual case. contractual penalty. 2.2 Non-Solicits There is no limitation in time for non-solicitation cov - enants in relation to customers, but they generally fol - low the same time limitations outlined in non-compe - tition covenants. Furthermore, in the same way as for non-competition covenants, a covenant regarding the non-solicitation of customers generally needs to be combined with compensation in order to be consid - ered reasonable. Each case must assess the reasona - bleness of a non-solicitation covenant concerning the solicitation of customers individually. 3. Data Privacy 3.1 Data Privacy Law and Employment The General Data Protection Regulation (GDPR) is applicable in Sweden and protects individuals against
622 CHAMBERS.COM
Powered by FlippingBook