Small businesses are Sweden's future, but the sick pay system makes it risky to hire. This is written by Micael Hamberg and Bo Hansson, spokespersons for Ambition Sverige.

When an employee falls ill, the individual is responsible for one day's sick leave. The company, on the other hand, is responsible for up to 14 days of sick pay. It's a system that works in practice for larger employers - but can be devastating for the small businesses that form the backbone of the Swedish economy.

For a small firm with two, three or four employees, extended sick leave can quickly become a major blow. The cost of sick pay is combined with lost production, replacement staff and administration. Sick leave can simply be the difference between profit and loss - or in the worst case, between survival and closure.

A system that penalises the smallest

The current sick pay system is built for the reality of large employers, where risks are spread across hundreds of employees. But for the small business owner - the hairdresser, the carpenter or the café owner - sick leave imposes an unreasonable financial burden. As a result, many are reluctant to hire, especially their first employee.

This is unfortunate. Sweden needs more small businesses that grow, not more rules that hold back the willingness to hire.

Ambition Sverige's proposal

Ambition Sverige proposes that companies with fewer than five employees should only be responsible for one day's sick pay - the same period as the individual. Thereafter, the state should take over responsibility for sick pay.

For growing companies, the liability can increase gradually with the number of employees. This creates a fair and proportionate system, where risks are distributed according to the actual ability of companies to bear them.

Security and growth can go hand in hand

Our reform would:

• Reduce the thresholds for small businesses to dare to hire.
• Create greater security for both employers and employees.
• Strengthen Swedish competitiveness and contribute to more jobs throughout the country.

If Sweden is serious about protecting small businesses, policy must also demonstrate this in practice. Making small businesses pay the same sick pay as large companies is neither fair nor sustainable.

It is time for a change. A modern sick pay system should encourage ambition - not penalise it.

Text: Micael Hamberg and Bo Hansson, spokespersons for Ambition Sverige