Changes in employment legislation

Changes in law and regulations

1. Access to cover permanent needs for labour by temporary employment for up to 12 months has been revoked

In 2015, a new provision was introduced in the Working Environment Act Section 14-9, second paragraph, letter f, which opened up general access to temporary employment for up to twelve months, (with some limitations), even if the workforce need to be met was of a permanent nature.

The main rule of the Working Environment Act is permanent employment, and the Storting has concluded that the provision in the Act’s Section 14-9, second paragraph, letter f, violates the principle that permanent needs must be met with permanent employees. It has therefore been decided that the provision shall be repealed with effect from 1 July 2022. Employment agreements based on the said legal authority which were entered into before the said date will not be affected by the change.

2. Rules on the collective right to bring an action have been reintroduced in the Working Environment Act

From 1 July 2022, previous rules on the collective right to bring an action for trade unions that want to review the legality of temporary employment have been reintroduced in the Working Environment Act. Such rules applied in the period 2013-2015. The rules in Section 17-1 fifth paragraph of the Act mean that trade unions that have members in a business that has hired workers from manning companies can bring legal action in their own name about the legality of such hiring. This applies even if none of the hired workers are members of the trade union. In such an action, the courts will only be able to rule on whether the temporary employment is/was legal. This is in contrast to where a hired worker itself brings an action to have the legality of the hiring reviewed, where the right to permanent employment and/or compensation can be claimed.

3. Changes in regulations on working from home

The Government has adopted changes to the regulations on home office work, which came into force on 1 July 2022. The most important changes are:

• Special rules on working hours that were previously in the regulations have been repealed, so that there are now the same rules for work carried out in the workplace as in the home office.
• The regulation only applies to work carried out in the employee’s “own home”. Work carried out from other places (e.g. cabin/holiday home, during holiday or business trip, etc.) is not covered.
• The regulation applies to those who have a home office as a “permanent arrangement”, (e.g. working from their own home one or more days per week). Is the scope small, e.g. less than one day on average per week, it will be considered “sporadic” and the regulation will not apply.
• There is a requirement that there must be a written agreement for working from home, if it is to be considered a permanent arrangement. Exceptions have been made if working from home is due to an order or recommendation from the authorities, (e.g. as was the case during the covid pandemic). In such cases, the employer can instead provide information after discussions with representatives.
• It has been made clear that the employer has responsibility for ensuring a sound physical and psychological working environment when working in a home office. The Ministry emphasises, among other things, that the employer must facilitate contact and communication with others in the business for those who work from home. The employer does not have access to the home office unless agreed.
• The regulations do not establish any obligation for the employer to make suitable equipment available to employees who work from a home office, (e.g. office furniture, computer equipment, etc.), or to cover costs incurred, (e.g. employee expenses for broadband). Such matters may be regulated in the home office agreement.
• The Norwegian Labour Inspection Authority must supervise the regulation. This does not mean that the Labour Inspection Authority must carry out checks in employees’ homes, and the inspection will primarily consist of checking that there is a written agreement for working from home that meets the requirements laid down in the regulations.

It is important that employers enter into written agreements with employees who work from home on a permanent basis that meet the statutory requirements.

4. The Transparency Act

The Act relating to enterprises’ transparency and work with fundamental human rights and decent working conditions, (the “Transparency Act”) entered into force on 1 July 2022. The Act aims to promote businesses’ respect for fundamental human rights and decent working conditions, and to ensure that the public has access to information about how businesses handle negative consequences within these areas. You can find more information about the Act in SANDS’ article: The Transparency Act - what does it entail and what consequences does it have for your business? published 08.08.2022.

Businesses that are defined as “large businesses” are directly covered by the Act, i.e. businesses that are covered by Section 1-5 of the Accounting Act, or that fulfil at least two of the following conditions: (i) have a sales income of over NOK 70 million, (ii) have a balance sheet total of over NOK 25 million, (iii) have an average of over 50 employees in the financial year. Statistics indicate that there are more than 8,000 Norwegian businesses that meet the above-mentioned conditions.

In order to achieve the purpose of the Act, those who are covered are firstly obliged to carry out so-called due diligence assessments, and secondly a duty to provide information upon request. The supervisory and sanctioning authority has been given to the Consumer Authority, which is also given a responsibility for guidance.

The responsibility for businesses that are covered by the Act is based on the following three pillars:

• Duty to carry out due diligence assessments
• Duty to give an account of their due diligence assessments
• Right to information for anyone who requests it.

According to the Transparency Act, “everyone” has the right to information from a business about how the business handles actual and potential negative consequences for fundamental human rights and decent working conditions. This means that, from 1 July 2022, both journalists, competitors or employees can send a written request for general information or information relating to a particular product or service that the business offers. The exceptions to the businesses’ duty to respond to such a request are few and narrow. The right to information about actual negative consequences for fundamental human rights that the business is aware of applies regardless of the exceptions.

The Transparency Act sets out a duty for the business to provide information within a reasonable time a no later than three weeks after the request for information has been received. The information shall be given in writing, be comprehensive, and understandable. There shall also be an annual report on the work, and the first report shall be available by 30 June 2023.

5. Public approval of businesses that offer car maintenance, tyre storage and tyre changes

From 1 July 2022, a regulation was introduced that establishes an approval scheme for businesses that offer car maintenance, tyre storage and tyre changes. The scheme is comparable to what has been practiced in the cleaning industry since 2012 and aims to ensure compliance with HSE requirements in the legislation, discourage the use of undeclared labour, and provide security for the buyers of the services.

The regulation means that businesses within car maintenance, tyre storage and tyre changes must document to the Labour Inspection Authority that they meet statutory requirements in the HSE area, and that they are registered in public registers. It will be illegal to buy services from businesses that are not approved, or do not have an application for approval pending.

6. Professional diving and piloting

With effect from 1 July 2022, the Working Environment Act has been applied to professional diving. In the past, professional diving along the coast was partly regulated by the Working Environment Act, with the Norwegian Labour Inspection Authority as the supervisory authority, partly by the shipping regulations, with the Norwegian Maritime Directorate as the supervisory authority, and partly not subject to any special regulations at all.

Pilots and pilot applicants were previously neither covered by the Working Environment Act nor the shipping legislation’s working environment and working time regulations. The change in the law means that these employees are now covered by the Working Environment Act.

Legislative proposal

A number of legislative changes have been proposed in the field of employment law, which are expected to come into force in 2023. This mainly applies to the following:

7. Tightening of the rules for hiring from manning companies

In a proposal to the Storting of 17 June 2022 (Prop. 131 L (2021-2022)), the Government has proposed legislative changes which entail a general tightening of access to hiring from manning companies. The proposal will be considered in the Storting in the autumn of 2022.

According to the current legislation in the Working Environment Act Section 14-12 (1), businesses can use hired labour from manning companies to the same extent that the businesses themselves can enter into agreements on temporary employment according to the Act’s Section 14-9 second paragraph. The before-mentioned provision opens in letter a for temporary employment when “the work is of a temporary nature”.

In the proposal, it is proposed that the right to use hired personnel from manning companies based on the before-mentioned legal authority (i.e. to cover work of a temporary nature) should be repealed. The provision is currently largely used in project-based assignments (e.g. in building and construction projects).

If the proposal is adopted, hiring from a manning company will only be permitted when hiring to cover temporary positions, or needs that are anchored in an agreement on hiring entered into with representatives in businesses bound by a tariff agreement with a trade union with the right of nomination, (i.e. one of the large national trade unions). The latter option will be conditional on the representatives giving their consent to hire from manning companies.

As an alternative to hiring personnel from manning companies, a business can in some cases use contracting to get work done. As of today, there is a grey area between what is to be considered hiring and contracting, and in the proposal, it is proposed to introduce a new provision in the law that sets out elements that argue that an assignment agreement between two businesses is to be considered hiring of employees.

In the same legislative proposal, it is proposed that hired employees from manning companies who have been continuously hired for three years in the same business shall have the right to permanent employment in the business in which they have been hired. According to current legislation, there is currently a four-year limit before such a right comes into effect.

In the proposal, it is also proposed to introduce an approval scheme for manning companies, which coincides with what was done for cleaning companies in 2012. The purpose is to give employers a better overview of the parties in the industry, and which ones operate seriously, as well as to strengthen the employees’ HSE relationship. It is assumed that the Labour Inspection Authority shall supervise that the set requirements are met.

Businesses that use hired personnel from manning companies to cover work of a “temporary nature” should prepare for the announced change in the law. It has been signalled that there will be transitional arrangements for initiated projects, which imply a gradual phasing in of new regulations.

8. Announced prohibition on hiring from manning companies for businesses in the construction industry in Oslo, Viken and former Vestfold County

In the legislative proposal of 17 June 2022 (Prop. 131 L), which is discussed above, it appears that in 2023, the Government plans to issue a regulation based on the Working Environment Act which will entail a prohibition for the construction industry in Oslo, Viken and former Vestfold County against utilising hiring from manning companies.

The reason why this has been brought up to date is that the authorities primarily want employees to be permanently employed in the business they work for. Statistics show that the proportion of employees hired from manning companies is significantly higher in the construction industry in the areas mentioned, than the situation in the industry in other areas of the country, as well as in other industries.

9. Proposal for legislation to strengthen the right to full-time employment

In a proposal of 17 June 2022 (Prop. 133 L (2021-2022)), the Government proposed to strengthen employees’ right to full-time employment. The proposal, among other things, stipulates that before a decision on part-time employment is made, the employer must document the need for such employment, as well as discuss this with representatives. There is currently no proposed date for the proposal to come into force.

Consultation memos

In 2022, the Government has sent out several consultation memos related to proposals for changes in working environment legislation.

Consultation memo of 8 March 2022 - The Ministry of Labour and Social Inclusion proposes to ratify ILO Convention 190 on the abolition of violence and harassment in working life, which in that case will entail some changes and clarifications in the Working Environment Act. The Convention has come in the wake of the Metoo campaign that started in 2017. The consultation deadline was 8 June 2022, and there is currently no proposition relating to the matter.

Consultation memo of 29 June 2022 - The Ministry of Labour and Social Inclusion proposes to implement EU directive 2019/1152 on clear and predictable working conditions. Sections 14-6 and 14-7 of the Working Environment Act contain rules on the minimum content of employment agreements, and they are proposed to be extended in a number of areas. This applies, among other things, to information having to be provided about the identity of the hiring business when hiring from a manning company, right to skills development, paid absence, procedure for termination of employment and social security arrangements. Furthermore, it is proposed that the employer’s deadline for providing a written employment agreement should be shortened from 1 month to 7 days after the employment relationship began. The consultation deadline is 20 October 2022.

Consultation memo of 30 May 2022 - The Ministry of Trade, Industry and Fisheries proposes that ships in Norwegian domestic shipping and ships that provide maritime services on the Norwegian continental shelf and in the Norwegian economic zone should be subject to a requirement for Norwegian wages and working conditions. The background to the proposal is to protect employees, prevent social dumping and counter low-wage competition.

Norwegian wage and working conditions mean provisions on wages, including overtime pay, shift and rotation pay and inconvenience pay, which follow from the law and the nationwide tariff agreement for NOR-registered ships that are engaged in the same type of business. The consultation deadline is 31 August 2022.