New case law – regarding consultation requirement etc. (AD 2026 nr 6)

An employee organisation requested negotiations with both a company, before it was declared bankrupt, and with the bankruptcy estate pursuant to Section 10 of the Co-determination Act regarding the employment conditions and wage claims of certain members and regarding the obligation to negotiate. The bankruptcy trustee declined to negotiate. The dispute has mainly concerned the question of whether the bankruptcy estate was thereby guilty of refusing to negotiate.

The Labour Court has found that the Co-determination Act, like other labour law legislation, is applicable even when an employer has been declared bankrupt. A bankruptcy estate, through a bankruptcy administrator, is therefore bound by, among other things, the provisions of the Co-determination Act on the employer’s obligation to negotiate and provide information and, in the application of those provisions, is considered to be bound by collective agreements and employment contracts in the same way as the bankrupt debtor was or had been. The general right to negotiate in Section 10 of the Co-determination Act applies to all employee organisations that have members employed by the employer, and the right to negotiate also applies during bankruptcy. When an employer is declared bankrupt, the bankruptcy estate therefore assumes the employer’s obligation to negotiate under Section 10 of the Co-determination Act. The issues on which the employee organisation requested negotiations are covered by the obligation to negotiate under Section 10 of the Co-determination Act, and the claim that the members were or had been employees of the company was not made against better judgement. The bankruptcy estate thus violated the obligation to negotiate when it refused to participate in negotiations and was ordered to pay general damages to the employee organisation.

Read more here (Swedish).