• Klarna will start drug testing employees in Sweden from January, Business Insider has learned.
• The buy-now, pay-later firm told staff about the new measures in an internal Slack post on Monday.
• Klarna, which is gearing up to IPO, said it was part of a wider effort to "strengthen security."

Klarna will start testing employees in Sweden for alcohol and drugs from January, Business Insider has learned, in a sign of the company increasing its internal security ahead of an anticipated IPO.

The buy-now, pay-later firm told employees via a company Slack channel post on Monday that an external supplier would carry out the random testing to ensure it was conducted in accordance with local laws and industry standards.

The post, from Klarna's director of people and HR, Mikaela Mijatovic, said the move was "part of a larger effort to strengthen security across Klarna."

The Slack message, seen by BI, said that Klarna plans to introduce similar drug testing in other countries where it operates, "following local laws and regulations." Mijatovic added that all new hires in Sweden will undergo testing during the recruitment process, starting in January.

Nafsika Karavida, an attorney at Reavis Page Jump in Sweden, told BI that employee drug testing is generally permitted under Swedish law within the private sector. She said it is "fairly common" in the fintech and banking industry and "getting more and more common."

The announcement comes after Sebastian Siemiatkowski, the CEO of Klarna, floated the idea of randomized drug testing to staff during a September all-hands. He said the company could need to introduce some additional safeguards because, as a growing financial institution, there had been greater interest in the startup from "less favorable parts of society: criminals, different hacking groups, and so forth," according to a recording of the meeting obtained by BI.

Some of the measures he discussed included monitoring employees' locations and drug testing staffers. Siemiatkowski added, "For more senior and more sensitive roles, this could also include things like understanding your financial statements to understand if someone is in trouble or could be potentially compromised."

In Monday's internal post, Mijatovic added that Klarna would also examine how it manages company devices and shares information externally.

The Swedish fintech, once Europe's most valuable startup, has been gearing up for an IPO in the US. It announced in November that it confidentially submitted draft registration documents to the Securities and Exchange Commission.

Klarna declined to comment.

Do you work for Klarna? Got a tip? Contact the reporter, Jyoti Mann, via the encrypted messaging app Signal at jyotimann.11 or via email at [email protected]. Reach out through a nonwork device.

• Klarna CEO Sebastian Siemiatkowski spoke about AI and the workforce.
• Siemiatkowski said AI "can already do all of the jobs" humans do.
• He said Klarna stopped hiring a year ago despite the company advertising jobs online.

Klarna CEO Sebastian Siemiatkowski is all-in on artificial intelligence at the fintech company.

In an interview with Bloomberg TV, Siemiatkowski said he's "of the opinion that AI can already do all of the jobs that we as humans do."

"It's just a question of how we apply it and use it," he said.

Klarna is a payment service that offers consumers "buy now, pay later" options. According to its website, the company is connected with more than 575,000 retailers.

The increased attention around AI has raised concerns about how it will affect careers and the workplace. A 2023 report by McKinsey & Company estimated that 12 million American workers will have to change occupations by 2030 as AI technology develops.

During the interview, Siemiatkowski said Klarna stopped hiring last year.

"I think what we've done internally hasn't been reported as widely. We stopped hiring about a year ago, so we were 4,500 and now we're 3,500," Siemiatkowski said. "We have a natural attrition like every tech company. People stay about five years, so 20% leave every year. By not hiring, we're simply shrinking, right?"

Siemiatkowski said his company has told employees that "what's going to happen is the total salary cost of Klarna is going to shrink, but part of the gain of that is going to be seen in your paycheck."

Although Klarna's website is advertising open positions at the time of writing, a spokesperson told Business Insider the company is not "actively recruiting" to expand its workforce. Rather, Klarna is backfilling "some essential roles," primarily in engineering.