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How long does it take to sign Byggavtalet?

Foreign entrepreneurs new to the ways of doing business in Sweden can set themselves up for headaches quite early in the process of entering the market for the first time. All they know is that they need to sign a collective bargaining agreement in order to start working on their client’s worksite. However, when they find out about all the hurdles, they must jump through to sign this agreement, the euphoria of securing a lucrative contract in Sweden turns into slight panic. The main worry is whether it is possible to get the papers in order, on time, not to lose the project. In this article I will detail the key steps in signing a collective bargaining agreement and what the expected time frame is. It is my sincere hope that this article is read by you before you make promises to your client that you can’t keep.

In my line of work a very common situation I encounter is that my client comes to me asking for help to sign a collective bargaining agreement. My client has already a signed contract with their Swedish client and the works will start in a month. Plenty of time to get the paperwork in order, right? Wrong. When I tell my client that it takes at least 2 months to sign a collective agreement, assuming the whole process goes perfectly, they immediately ask if there is any way to make things go faster? They ask if I can call to some handler and explain the situation to speed up the process. „Tell them that it is an emergency, ask for permission to start working on the site while the agreement application is being reviewed. Try to find a compromise “. The answer to all these suggestions is the same: „it is not possible “.

Things in Sweden move slowly, and especially in the construction sector, there is no room for exceptions. You have to file the paperwork perfectly, and do the preliminary work with time to spare, to ensure a smooth entry onto the work site. In my example below I will use the process for signing the Byggavtalet (The Construction Agreement) which is one of the most widely used collective bargaining agreements in the Swedish construction sector. There are many other agreements that can be signed, handled by other unions, but in general the application process and the length of it is similar.

Step 1: Have a company ready to do business in Sweden. 0-8 weeks.

The first thing that needs to be in order before you can even start putting together an application to a union is having a company, either foreign or Swedish, with the correct registrations. In the worst-case scenario, my client does not even have a company with the necessary basic registrations like F-tax or employer registration. Filing for these registrations alone and having them approved can take 4-8 weeks, even longer during summertimes and holidays. Before accepting a project in Sweden, it is vital to already make up your mind if you want to carry out the project with a Swedish legal entity or a legal entity based in your home country. There are pros and cons to both.

If you happen to be in a situation where you don’t have a company with Swedish registrations, you can buy a ready-made Swedish company with the necessary registrations that you can use immediately. However, it is an extra expense ranging between 20 000 – 50 000 SEK depending on the state of the company.

Having a company with F-tax and employer registration is a prerequisite to signing a collective bargaining agreement. Without these, your application won’t even be accepted, so it is vital that these registrations are dealt with first, before moving on the next step.

Step 2: Compiling the collective bargaining agreement signing application. 6-8 weeks.

In the case of signing the Byggavtalet, there are a lot of documents that need to be submitted. Some examples are proof of company registration, signed work agreements, and a copy of the contract with your client. These are relatively simple to get your hands on but some of the more time-consuming documents to obtain involve subscribing to services, like the ID06 personal log card platform or occupational healthcare policy. It can take some time to set up these agreements, especially if you operate a foreign company without having a signatory who can use the Swedish Bank-ID electronic signing app. In those cases, entering agreements with such service provides can take longer because some of the paperwork must be handled manually.

In case you plan to post workers, you also need to send A1 certificates, which in some countries can take a long time to get approved. Finally, Byggnads requires all documents to be translated to Swedish. When the application is complete, it takes them 6-8 weeks to process the application, contact you, and set up a meeting where you are invited to be informed about the main components of the agreement and finally sign it with them. Because it takes a while to compile all the documents needed for the application it would be appropriate to add an extra week to the already mentioned 6-8 weeks to your time frame.

Step 3: Waiting for the agreement signing meeting. 0-2 weeks.

After the application has been successfully reviewed, Byggnads will call to a meeting, usually 0-2 weeks after their response. Before showing up to the meeting, you must make sure to have an authorized interpreter with you (which you pay for) that can translate during the negotiations in case you don’t speak Swedish. During this meeting, which usually takes around 2-4 hours, the Byggnads representatives will acquaint you with the most important parts of the collective bargaining agreement. After the introduction, you will “negotiate” a base salary that you must pay to all your employees. Finally, the parties sign the agreement, and you are free to send your workforce to the client’s work site.

Keep in mind, this base salary only applies to the specific region in which the Byggnads branch operates. In case you find work in a new region, you must set up a new meeting with that regions Byggnads branch. Fortunately, you don’t have to repeat the whole process, you only have to go to the new region branch to discuss the salary terms for that specific region. The main agreement is already signed and remains signed until you or Byggnads choose to terminate it. Byggnads might choose to terminate the agreement in case they find that you are not complying with the terms set out in the agreement.

The total time expectancy to sign a collective bargaining agreement.

Adding all these steps together, we get an estimated waiting expectancy of 6 – 19 weeks. Signing an agreement in 6 weeks is very rare and only possible if you already have a company with necessary Swedish registrations. I would advise most foreign construction entrepreneurs to expect the whole process to take around 16 weeks. That means, if you find a Swedish client who offers you a project expecting you to sign a collective bargaining agreement, don’t promise the client to be able to start working earlier than in 16 weeks. That way both you and the client have a realistic timeline to work with and hopefully this leads to avoiding lots of stressful moments. In addition to these 16 weeks, take into consideration the season in which you start this process. If the timeline overlaps with periods like the summer or major holidays, then expect the process to take longer since most handlers are on vacation.

Luckily, signing a collective bargaining agreement is a process that must be done only once, and doing it correctly, ensures that future projects are much less stress inducing. Contact me to receive free consultation and I’ll help you figure out a realistic timeline to sign a collective bargaining agreement as quickly and painlessly as possible.

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