We have therefore provied this guide in english, that will give you an overview of employment and labour law in Norway. At the bottom of the article, you will also find our contact information, if you are in need of further assistance.
1. Introductory remarks
This article will give you an overview of Norwegian employment law, with a focus on how to employ and terminate staff.
1.1 Legal system
Norwegian employment law is principally governed by the Working Environment Act (WEA) – Lov om arbeidsmiljø, arbeidstid og stillingsvern mv. (arbeidsmiljøloven). WEA provides minimum rights, which cannot, as a principal rule, be derogated from in disfavour for the employee, view section 1-9.
An unofficial translation of WEA is made available by the Norwegian Labour Inspection Authority online at this address: http://www.arbeidstilsynet.no/binfil/download2.php?tid=92156
In addition the rules of termination of employment can be governed or supplemented by the staff regulations, or an independent agreement between the employer and employee. To be valid, such condition in any individual or collective contract or agreement must be better in favour of the employees than the minimum rules provided by WEA.
1.2. Trade unions
The trade unions stand quite strong in Norway. The main The Norwegian Confederation of Trade Unions (LO) is decidedly the largest and most influential workers’ organisation in Norway. On the employer side, NHO is the main representative organisation for Norwegian employers with companies ranging from small family-owned businesses to multi-national companies. If an employee is member of a labour union, certain rules can be deviated from collective agreements between the union and employer or union and a collective of employers, including the employer.
1.3. Employment contract in general
The employer has en obligation to enter into a written contract with all of the employees. This applies regardless of whether it is a permanent position or a temporary employment, and independent of the duration of employment. There are no exceptions to this rule. It is the employer’s responsibility to prepare a written contract. The employment contract must be signed no later than one month after the employee started working.
If an employment contract contains conditions, which are contrary to, the provisions of law or regulation, the agreement will not be valid in these areas, even if both employer and employee sign it.
2. How to enter in to an employment relation
2.1. Contract for regular employees
Although the employer shall ensure that there is a written contract of employment in any employment, there are still some employees who do not have a contract. A verbal agreement is as valid as a written.
The employment contract shall state on matters of significant importance in the employment, and shall at a minimum provide the following information:
– The employees name and identity
– The workplace. If there is no fixed or main place of work, the employment contract shall state that the employee works in different locations, and the employer shall state the business address to the employer.
– A description of the work or the employee’s title, position or employment category
– When the employments starts
– The expected duration if the employment is temporary.
– Probation provisions.
– The employee’s right to vacation and holiday pay, and the rules for determining vacation time.
– The employee’s and the employer’s notice periods.
– Salary or any other benefits
– The length and location of the agreed daily or weekly working hours. Flexible working hours
– Length of breaks.
– Details of any collective agreements effecting the employment.
2.2. Management contracts
The Norwegian Employment Protection Act (WEA) provides that a main point of all workers have the same rights, view section 1-9. Nevertheless, employees in management or senior positions can be exempt from the strict rules of working hours and overtime payments. It is also possible to exempt a CEO from the strict rules of causes for termination provided that he or she has entered into a written contract beforehand, and that the leader is given a fixed «fair settlement».
3. Termination in accordance to the WEA
3.1. Before any termination – laying the groundwork
There is no statutory requirement for employers to issue a formal warning before proceeding with a dismissal or summary dismissal. However, the Working Environment Act dictates some strict requirements that must be met in order to execute a termination correctly.
The first requirement is have a solid and just cause for the termination. There is no «at-will employment» under Norwegian law – the employer must prove just grounds for termination. Downsizing is generally seen as just grounds for termination, but it has to be carried out with a strict focus on equal and objective selection of which employees that should be selected to be redundant.
For individual terminations, the employee must deliver a results that are obviously sub-standard, or otherwise show neglect or lack of loyalty to such an extend that it is objectively clear that the employment must be terminated.
3.2 Individual consultation meetings before termination
Prior to giving the employee the actual termination an employer shall, to the extent that it is practically possible, consult with the employee to discuss the matter (WEA section 15-1). If such consultations are not held the termination is not necessarily invalid, nevertheless it will be an important factor in assessment of whether the dismissal is objectively justified.
3.3. Dismissal to personal reasons
Section 15-7 in the Norwegian Employment Protection Act states that a dismissal must be objectively justified to be legal. Even when an employer can prove personal reasons for a dismissal, the Supreme Court has also ruled that the dismissal also must – as a whole – be fair from an evaluation of both the employer and employees interests.
3.3.1. Dismissal with notice
The main form of dismissal is with prior notice. Such dismissal must either be objectively justified on the basis of circumstances relating to the undertaking, the employer or the employee.
If termination is related to curtail or rationalisation related to the undertaking, the termination is not objectively justified if the employer has other suitable work in the undertaking to offer the employee. Furthermore when deciding whether a dismissal is objectively justified by curtailed operations or rationalisation measures, the needs of the undertaking must be weighed against the disadvantage caused by the dismissal for the individual employee.
Additionally, were employees are dismissed on the grounds of circumstances related to the business or organization, the criteria for selection of employees for dismissal must be objectively justified.
An employee who has been dismissed, owing to circumstances relating to the undertaking, has a preferential right to a new appointment at the same undertaking, unless the vacant post is one for which the employee is not qualified.
3.2.2. Dismissal during the employee’s trial period
An employee under trial period can be dismissed on the grounds of lack of suitability for the work or lack of proficiency or reliability. The threshold for dismissal on these grounds is considered not as strict as with regular termination with notice.
3.2.3. Dismissal during the employee’s sick leave or maternity leave
Unless other grounds are shown highly probable, absence from work owing to illness shall be deemed to be the reason for dismissal during that period. Dismissal on the grounds of sick leave is viewed as not objectively justified.
Likewise an employee may not be dismissed on the grounds of pregnancy or maternity leave. Dismissal during such leave is considered the reason for dismissal unless other grounds are shown to be highly probable.
3.2.4. Notice period
The period of notice is, according to WEA, determined by a combination of the number of years of employment and the age of the specific employee. If an employee is dismissed during the trial period of employment, the period of notice is 14 days.
The period of notice, after outset of possible trial period, is as follows:
Number of years of employment / age Period of notice
– Less than five years 1
– Five years or more 2
– Ten years 3
– Ten years / 50 years and above 4
– Ten years / 55 years and above 5
– Ten years / 60 years and above 6
Additionally, unless the dismissal takes place during the employee’s trial period, the period of notice runs from and including the first day of the month following that in which notice is given.
3.2.5. Formal requirements for the notice of termination
The notice, whether it is from the employee or the employer, shall be in writing. The notice from an employer must additionally inform the employee of the following;
– the employee’s right to negotiations and his right to institute legal proceedings;
– the time limits applicable for requesting negotiations, instituting legal proceedings and remaining in a post;
– the employee’s right to remain in his post during negotiations and legal proceedings commenced within certain time limits;
– the name of the employer and the appropriate defendant in the event of legal proceedings.
Additionally the notice must be delivered to the employee in person or be forwarded by registered mail to the address given by the employee.
If the employer’s notice does not fulfil the above-mentioned requirements, and the employee institute legal proceedings within four months, the notice shall be ruled invalid unless special circumstances make this clearly unreasonable.
3.3. Summary dismissal
Termination without notice (summary dismissal) requires that the employee is found to guilty of gross breach of duty or in other serious breach of the contract of employment. Such termination of employment is, as general rule, reserved for cases where other sanctions (including termination with notice, warnings etc.) are deemed insufficient.
An employee, who wishes to claim that a dismissal is unlawful, may demand negotiations with the employer. Such demand for negotiations must be notified the employer in writing within two weeks after the dismissal of the employee. The employer shall ensure that a meeting of negotiations is held as early as possible, and at latest, within two weeks of receiving the request.
The time limit for instituting legal proceedings is eight weeks following the end of the above-mentioned negotiations or dismissal, if the negotiations are not held. If the employee claims compensation only, and not to be reinstated in his position, the time limit for legal proceedings is six months. If the notice does not fulfil the above-mentioned formal requirements, WEA does not impose any time limit for the employee to initiate legal proceedings.
If dismissal is proven unlawful, the employer is liable to compensation for the employee’s economic loss as well as damages for non-economic loss, see 6.2. The dismissal may also be proven void, which means that the employment relationship continues.
3.5. Collective redundancies
If at least ten employees, within a period of 30 days, are dismissed, the dismissal is viewed as a collective redundancy. An employer contemplating collective redundancies shall, at the earliest opportunity, enter into consultations with the employee’s elected representatives. The elected representatives also have a right to receive relevant information, among other things the grounds for redundancies and the number and categories of employees of which will be affected by the redundancies.
Furthermore the redundancies will not come into effect earlier than 30 days after the Norwegian Labour and Welfare Service (NAV) has been informed.
4. The rights of employees in the event of business transfers
4.1. Rules regarding business transferred and the right to be transferred
Employee’s rights are all in all to be preserved during business transfers. The Working Environment Act is compliant with the Council Directive 77/187/EEC of 14 February 1977 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of businesses. Transfer of an undertaking to another employer is not in itself grounds for dismissal.
Therefore, the general rules for dismissal, that is mentioned in section 3 above, also applies for business transfers.
During business transfers, the former and new employer must as early as possible inform the affected employees of the transfer and discuss it with the employee’s elected representatives.
4.2. Effects of the right to say no to be transferred
An employee may object to the transfer of business. Such reservation must be manifested in writing within a certain time limit, view section 16-3.
An employee who object to the transfer of business, and if the employee has had a employment contract over the last 12 months, the employee has a preferential right to new appointment at the former employer for one year, from the date of the transfer, unless the vacant post is one for which the employee is not qualified.
5. Right to stay in employment during the period of notice
During legal proceedings the employee normally is allowed to remain at his post, given that the time limit for instituting legal proceedings is complied. The court can decide otherwise by temporary injunction.
The right to remain in employment does not apply to disputes concerning summary dismissal, terminations in the employee’s trial period, for hired workers or temporary employees. However, the court can decide otherwise.
6. Special topics
6.1 The obligation to negotiate with trade unions before downsizing or restructuring.
Employers with more than 50 employees are required to have regular consultations with representatives for the employees. This is especially important prior to terminations due to downsizing or restructuring. Such consultations should be carried out «as early as possible». The objective of such consultations is to minimise the negative effects to the employees, and should aim at reaching an agreement with the employees.
An individual employee that contests a dismissal can be awarded damages if the case is brought to court. The courts are given mandate to award discretionary compensation. According to the supreme court, the damages should «at least» cover suffered wages loss. In addition, a tort compensation can be awarded, which usually amounts to between 5.000 to 15.000 Euro.
Individual dismissal cases starts in the local district Court – «tingretten». Verdicts can be brought forward to «lagmannsretten», the Court of appeal. After strict selection criterias, some cases are also admitted to the Supreme Court – Norges Høyesterett.
About the authors / legal assistance with employment law in Norway
We hope you have enjoyed our guide to Norwegian employment and labour law. This article is written be the employment lawyers of Dalan Law firm in Oslo, and edited by partner and attorney, Eivind Arntsen.
For legal assistance with Norwegian employment law, please contact Mr Arntsen at email@example.com or call (+47) 930 33 669.