Before the Breakdown of the Saltsjöbaden Spirit of Labour Market Cooperation : The Swedish Employers’ Confederation and workplace democracy in the 1960s

The 1976 Swedish landmark law on workplace democracy, Medbestämmandelagen (MBL), has traditionally been regarded as a victory of social democracy over recalcitrant employers. In contrast, this article shows how, in fact, before the law, the Swedish Employers’ Confederation (SAF) was the main driver behind Swedish research on work life reform, and the main promoter of employer-union dialogue on the matter. Crucially, in the 1960s, SAF endorsed the internationally pioneering thinking of economist Eric Rhenman, who argued that conflict within the firm between managers and unions was unavoidable, healthy, and could be good for business if framed in a productive manner. Today, this line of management thinking is termed the Scandinavian Cooperative Advantage. However, in the early 1970s, Swedish social democracy radicalized abruptly. The SAF board initially interpreted the new radicalism as a masquerade to appease activists. SAF assumed that, behind the scenes, the Swedish spirit of consensus-oriented labour market dialogue would prevail, as it had since the 1938 Saltsjöbaden agreement. And assuredly, the actual effects of the MBL law proved to be considerably less radical than advertised, and broadly compatible with Rhenman’s thinking. Still, social democracy’s new ideological rhetoric helped prompt SAF’s late 1970s shift from cooperation to conflict