Swedish government faces battle to stay in power as labour talks fail

STOCKHOLM (Reuters) – Sweden’s minority government faces a potential rebellion by three small parties that keep it in power over plans to ease rules in the country’s rigid labour market.

Talks between trade unions and employer organisations broke down early on Thursday, handing the job of finding a solution to the Social Democrat-Green government. The government needs the backing of the Left Party as well as two small centre-right parties to pass its budgets.

Prime Minister Stefan Lofven had promised the two centre-right parties that if the unions and employers fail to agree new practices, the government would adopt proposals made by a commission to ease first-in-last-out rules, which critics say hamper companies’ ability to adapt to changing conditions.

Left Party leader Jonas Sjostedt said he would try to bring down the coalition if that plan goes ahead.

“Stefan Lofven cannot remain as prime minister if he plans to put

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Swedish PM Faces Labor Dispute That Could Destabilize Government

(Bloomberg) — Trade unions and employers are approaching a deadline for talks that could determine the future of Sweden’s center-left government, and challenge the country’s established model for labor market relations.

The negotiations will need to be concluded by Wednesday. Failing that, Prime Minister Stefan Lofven may need to force through a solution, potentially triggering a vote of no confidence in his government as he breaks with tradition.

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The issue originates with the 2018 elections, in which the ruling coalition failed to gain a majority. One of the key concessions that Lofven had to make in return for the support of the Center Party and the Liberals was a deal to “modernize” the labor market and make it more flexible.

A parliamentary committee has since drafted proposals based on that January 2019 deal.

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