"All members get a pay raise in real terms, and nursing assistants get an extra raise," said Annelie Nordström, secretary general of the Kommunal union.
The agreement will last for three years, according to Heléne Fritzone, the chair of the Swedish Association of Local Authorities and Regions (SALAR).
In Sweden, health care is run by the county councils and many other services are funded at the municipal level.
The new collective bargaining agreement is worth SEK 520 more per month for local government employees. Nursing assistants will get SEK 1,020 more in the first year of this three-year deal.
As well as pay, the collective agreement regulates conditions at work. The new deal has a full-time career as the norm, and the union is hailing this as a "historic victory".