Employ Candidates Compliantly in Norway

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  1. Overview: Norway
  2. Global HR Compliance
  3. Global PEO and payroll
  4. Work permit for hiring expats via PEO
  5. Expand without a company set up
  6. Contractor vs. employee: which is better?
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Global HR Compliance in Norway

If you hire international workforce, or plan to hire, then Hiring and Firing Workforce in Norway Guide below will help you understand the nuances of labor legislation in the country.

There are two main reasons for companies hiring foreign workforce:

  • Expanding into foreign markets to sell company product or products there. In this case, companies hire sales representatives who would exclusively represent their product in the target market and sell it to their local client base.
  • Hiring the right foreign talent with a unique expertise, often related to IT sphere that cannot be found in the home country or that costs less compared to local specialist with similar skills.

After you have found the right candidate, the question is how to hire and provide compensation to this person so you as a business remain 100% compliant when working with global workforce. Another thing to consider is whether you want to keep the talent long-term and how you can do that.

If you need to hire foreign workforce in Norway so you can expand there, then our Global Employer of Record solution may be of help. We help you legally hire and reward your foreign workforce by making them employees via a global employment outsourcing service. This is simple as employ your in-house workforce with the only difference that workers can live anywhere in the world and Acumen International would be their legal employer on your behalf. This means we would bear all employment risks, not you. Also, we manage bonuses, vacations, sick leave and can rent the office and a car for your foreign sales representatives if that is what you need.

With our solution, you can test new foreign markets before deciding whether you are going to get established there. You gain flexibility and expand with reduced costs, and easily withdraw from the unattractive countries.

We are experts in global workforce employment in Norway, and our goal is to become your single provider. Instead of working with numerous local staffing agencies and legal advisors, Acumen International can solve your global business challenges and save you time, costs, and resources.

Our team of English-speaking professionals frees you from working through language nuances. Acumen International works 24/7 and can assist you whenever you need, regardless of time zones. Our goal is to create tailored labor solutions for you that are managed legally and in full compliance with the local employment laws.

With our knowledge and deep understanding of local nuances, you easily satisfy your need for skilled professionals in your global industry. With our qualified local partners, you can trust that your global workforce satisfies all local tax, social security, and immigration requirements in Norway.

See the guide below for a general overview of labor rules and regulations in Norway. Or contact us if you need to employ workers in Norway or would like to get more details.

Hiring and Firing Workforce in Norway Guide

Norway has a long history of economic stability, high standard of living, full involvement in EU and all these constitute some of the key factors that make it very attractive to entrepreneurs who wish to expand internationally. In spite of Norway’s good record of being one of the easiest places to do business, there are still some tough nuts to crack if one must succeed in his enterprise there. Among other things, there is need for one to grasp the country’s employment regulatory framework, as well as ensure that all its components are complied to, and therein lies one of the biggest challenges.

The good news is that there is an alternative way to go about this situation. All you need to do is employ the services of a locally sourced provider who knows the ins and outs of the employment law in Norway. Global employer of Record is all you need to do that.

Below are some of the key facts about doing business in Norway

# Employment Contracts

Contract of Employment in Norway should mandatorily be provided in writing and must be given to the employee not later than one month after he has been offered the employment. Under the rule, all employment contract must clearly include the length of the employment, job description, working hours, period of probation, remuneration (time and means of payment), overtime pay, terms of notification, holiday and leave entitlement.
General principle in Norwegian employment law is a permanent employment, however legislation gives employers a general right to use temporary employment for up to 12 months.

# Minimum statutory employment rights

# Hours of work
The permissible working hours per day in Norway is 9 hours, with one hour included for lunch and 40 hours per week. This rule does not apply to under 18 employees, those working underground, shift workers, night-shift workers and those required to work on Sundays. Employees who are 62 years and above can be allowed to work for lesser hours as agreed with the employer. Those who do passive jobs may be allowed to work for 11 hours per day or even up to 13 hours after being approved by the Labor Inspection Authority, but must not exceed 48 hours per work week.
Labour market practice of 37.5 hours per week, 7.5 hours per day.

# Probationary period
Trial period generally takes a maximum length of 6 months. An extension is allowed if the employee was given a prior warning in writing at the time of his employment and before the given period expires. An employer has the right to extend a probationary period in the event of the employee’s absent during the given period, usually by the extent of time absent from work. An employer can terminate a contract of employment during the trial period if the employee is proven to be incompetent or unsuitable for the job.

# Annual leave
Norwegian law explicitly states that all employees are entitled to a paid day off on the Labor Day holiday and Constitution Day holiday. Other legal holidays which may or may not be paid for are as follows: New Year’s Day, Maundy Thursday, Good Friday, Easter Sunday, Easter Monday, Ascension Day, Pentecost, Monday after Pentecost, Christmas Day and Boxing Day.

Employees are additionally entitled to 25 days annual vacation and an extra 6 work day paid leave if they are up to 60 years old. Annual leave is statutorily paid for at a rate of 10.2 of the employee’s salary or at 12.5 for the 60s and over 60s. Employees are entitled to receive their annual leave pay on the last work day prior to the start of the leave or one week earlier on an employee’s request. Annual leave must ordinarily be used up during the given year, usually between the first day of June and the last day of September. An employee who wishes to carry over his annual leave to the following year must first agree with his employer in writing and must be under the condition that not more than 12 days of the leave will be carried over.

# Parental leave
Maternity leave is given to only the employees who have worked a minimum of 6 months within the last 10 months and earn not less than 50 percent of the country’s National Insurance base fund. Other employees who do not quality for this benefit, including the single mothers are simply paid a maternity grant and an additional grant (for single mothers).
Maternity leave – 13 weeks: three weeks before the birth and ten weeks following birth. It is obligatory to take six weeks leave after birth for health reasons. 100 per cent of earnings up to a ceiling of six times the basic national insurance benefit payment funded from general taxation.

Parental leave – 46 or 56 weeks depending on payment level + a further three weeks before birth, i.e. a total of 49/59 weeks. Of the postnatal period, ten weeks are for mothers and ten weeks are for fathers. The remaining 26 or 36 weeks is a family entitlement and may be taken by either mother or father. Parental money may either be taken for 49 weeks at 100 per cent of earnings or for 59 weeks at 80 per cent of earnings, up to a ceiling of six times the basic national insurance benefit payment (regulated on 1 May each year). Most employees are included in collective agreements where the employers pay the difference between wages and the cap. It is funded from general taxation.

# Sick leave
As a rule, to receive sick leave, you need to have been employed by the same employer at least 4 weeks before taking out a sick leave. The total sick leave entitlement is 52 weeks. All sick employees have the right to receive a sick benefit from their employees throughout the first 16 days of them being sick. Afterwards, the National Insurance takes up the responsibility and makes payment. Normally, the leave is 100% of the gross income, calculated of the average of the last 4 weeks before the leave.

# Overtime
Employees can work certain number of hours in excess of the normal working hours if the reasons for that are justifiable. In such cases, they can be allowed to work up to 10 hours overtime over a 7-day period, 25 hours over a 4-week period and 200 hours over a 52-week period. Under 18 employees are not permitted to work overtime at all.
The overtimes must be paid at a premium rate of at least 40% over the normal rate.

# State minimum salary
Minimum wage is mostly decided by collective wage agreements. In the case where there are no collective wage agreements, both parties of employment are expected to discuss and assent to a fair wage. In any case, an employer is required to remunerate his employees at least 2 time in each month.

# Employment termination
In Norway, the employer can terminate a contract as much as the employee can, and giving prior written notice is a core prerequisite for such termination.
The period of notice is 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.

If it is the employer who wishes to end the contract, he must do that only on objective reasons. Also, an employer is required to have a meeting with the employee (and his representatives if any) where he will explain to him the reason(s) for his dismissal. However, an employer is not obligated to make any special payment to a dismissed employee. The only entitlements an employee has at dismissal are the wage for the work done during the notice period, payment for any unused leave and a written reference from the employer.

Acumen International can help you fast-track your possibilities of entering and expanding your business in Norway by providing you with an Employer of Record services. Our unique mix of PEO/EOR solutions will enable you to jumpstart your global operations almost immediately, cost-effectively and compliantly without any requirement to set up a legal entity first or thereafter.

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