New rules for group companies adopted

In Norway, most rights and obligations for companies and employees are regulated by the Norwegian Working Environment Act. For the Norwegian government, it is therefore important that the Act is renewed and strengthened in line with new developments and changes in Norwegian working life. Based on this, the Norwegian parliament has now adopted significant new rules to the Act.

The new rules will enter into force on 1 January 2024.

No one will be left out of the group

The new rules will significantly increase employee rights and company obligations when the company is part of a group. Companies’ obligations regarding working environment responsibilities and the duty to discuss will now significantly be increased. The new rules include:

As something new, group companies with 50 or more employees are required to establish a framework for information, cooperation and discussion within the group.

As something new, group companies with 50 or more employees are required to discuss any changes that significantly affect more than one of the subsidiary companies in the group with the employee representatives.

Today, companies must offer other suitable work within the company before an employee is terminated due to redundancy. Going forward, subsidiary companies will also be required to offer other suitable work within all the entities in the group.

Today, employees terminated due to redundancy have a preferential right to any new, suitable positions in the company. Going forward, employees will also have a preferential right to any new, suitable positions within all entities in the group.

The company’s safety representative’s responsibility will be increased. Going forward, the safety representative will be responsible for ensuring the interest of temporary agency workers and contractors as well as the employees.

As something new, companies must elect a safety representative when the company regularly employs 5 or more employees. Today this is a requirement with 10 or more employees.

As something new, companies must establish a working environment committee when the company regularly employs 30 or more employees. Today this is a requirement with 50 or more employees.

As something new, companies will be required to discuss the need for contractors once a year with the employee representatives, in addition to the need for temporary agency workers and part-time- and temporary employment.

Today, temporary employees will be entitled to permanent employment after four or three years, depending on the reason for temporary employment. Going forward, temporary employees will be entitled to permanent employment after three years, regardless of the reason.

Today, the legal difference between employees and contractors is already established by practice. Together with a legal assumption of employee status, the employee concept will be established in law going forward.

IUNO’s opinion

Several of the new rules will significantly affect group companies. However, the new rules do provide an important exception. Only companies in Norway will be subject to the new obligations. As such, group companies will only have to offer other suitable positions within the group company’s entities in Norway and not for potential companies in other countries.

The new rules will impact companies in several ways. IUNO recommends that companies consider updating their routines on employee representative discussions and assess whether contractors are in fact employees. Group companies may also need to update standard documents to reflect the new employee rights. For example, the new preferential rights in the notice of termination.

[Amendments to the Norwegian Working Environment Act of 17 March 2023]