Employees may be made redundant if there are objective grounds for the redundancy. The redundancy must be objectively justified based on the circumstances of the business, the employer or the employee.
Coronavirus and redundancy
There are no changes or proposed changes related to the rules and regulations concerning redundancy in relation to the coronavirus epidemic. As an employer you are still bound by the notice period you have agreed to. The Working Environment Act also stipulates minimum requirements concerning the notice period. In order to terminate employment, there has to be a valid reason. A temporary suspension of operations is not an obvious reason to terminate employment. The new rules proposed by the Government means that you, as an employer, are only obligated to two extra days of salary duty by temporarily laying off employees rather than terminating the employment. For the employee, the financial consequences of a termination of employment will be more severe than a layoff, as the Government has proposed an increase in the unemployment benefit during layoff.
Discussion prior to decision concerning redundancy
As employer, you are obliged to hold a discussion meeting with the employee and his or her elected representative before any decision is taken regarding redundancy, unless the employee themselves does not wish such a meeting to be held.
Content and form of redundancy notices
In the case of termination of employment initiated by the employer, written notice of redundancy must be given. The redundancy notice must be delivered to the employee personally or sent by registered post to the employee's specified address. The Norwegian Labour Inspection Authority will be able to provide more information concerning the information that must be given in a redundancy notice. If the employee so requests, you must justify the redundancy in writing.
Avoid procedural errors
If you make any procedural errors in connection with the redundancy, such as not issuing a written redundancy notice or issuing a redundancy notice which does not contain the requisite information, the employee may initiate legal proceedings without four months. The redundancy will then normally be considered invalid and the employee will be entitled to claim compensation.
Warnings to employees
Warnings can be given to employees if they are guilty of doing something which is considered unacceptable by the employer. You should issue warnings in writing, or alternatively verbally with written minutes signed by both parties. The warning should include a description of the circumstances, your expectations and the consequences if the circumstances are not rectified. The warning must give the employee the opportunity to change their behaviour and document that the circumstances have been addressed. In the event of redundancy, warnings may provide important evidence that the redundancy has been objectively justified.
Protection against unfair dismissal
All redundancies must be objectively justified. It will not normally be considered an objective basis to make permanent employees redundant and then replace them with self-employed contractors (such as freelancers), unless it is necessary to ensure that the business remains a going concern. Special redundancy protection applies in the event of illness, military service and during and after pregnancy.
Period of notice
The period of notice is linked to the length of time that the employee has been employed and the age of the employee concerned. The period of notice is normally determined in whole calendar months commencing on the first day of the month after the month in which the redundancy notice is issued. The rules concerning period of notice also apply to temporary employees.
|Age of employee/Duration of employment||Under 50||50 - 54||55 - 59||Over 60|
|Employed for less than 5 years||1 month||1 month||1 month||1 month|
|Employed for more than 5 years||2 months||2 months||2 months||2 months|
|Employed for more than 10 years||3 months||4 months*||5 months*||6 months*|
*In the event of resignation by the employee, the period of notice is never more than three months.
Agreement to use a shorter period of notice may only be reached between an employer and elected representatives if the enterprise is bound by a collective agreement.
Notice period during trial periods
At the time of appointment, you and your employee can agree on a trial period of up to six months. During the trial period, a mutual period of notice of 14 days will apply. The period of notice of 14 days only applies if the termination of employment is due to the employee's adaptation to the work, professional competence or reliability. If you have agreed a trial period, this must be stated in the employment agreement.
If an employee has been absent during the trial period, the duration of the absence may be added to the length of the trial period. You need to specify this condition in the employment contract for it to apply, and you need inform the employee, before the end of the original trial period, that the trial period is prolonged. The Trial period cannot be prolonged if the employer is the cause the absence.
Termination of employment due to age
Employers may terminate an employment relationship when the employee reaches the age of 72. You can set a lower age limit if it is necessary for health and safety reasons. A lower age limit of not less than 70 may be set if the limit is made known to the employees and is practised consistently and the employees are entitled to a satisfactory occupational pension scheme. Employees have a right to written notice no later than six months before the date of termination of their employment.
Redundancy and offer of suitable alternative employment
This situation concerns the termination of an existing employment agreement, with an offer of a new agreement. In this situation, the same rules apply as those which apply to ordinary redundancy.
In this case, an employee has the following options:
- Accept the change and take up the revised position immediately by agreement with the employer.
- Accept the change, but opt to continue in his or her old position until the end of the period of notice.
- Reject the change and opt to initiate proceedings against the employer or terminate his or her employment at the end of the notice period.
Any employer who is considering making at least ten of their employees redundant within a period of 30 days must discuss the matter with the elected representatives as soon as possible. The aim is to avoid redundancies or reduce the number of employees made redundant. If you are unable to avoid redundancies, you must attempt to minimise the unfortunate consequences of the redundancies. You are obliged to provide the elected representatives and NAV with all relevant information in writing. Planned collective redundancies may not take effect any earlier than 30 days after notification has been sent to NAV.
If there is reason to believe that an employee is guilty of something that could lead to dismissal and the needs of the business necessitate it, the employee may be ordered to leave their employment (be suspended) while the matter is being investigated. Employees retain their salary during their suspension period.
Employers may dismiss an employee with immediate effect (redundancy on the same day) if the employee is guilty of a gross dereliction of duty or other material breach of their employment agreement. Examples of this include proven embezzlement, fraud, theft, threats, violence, punching and kicking, gross sexual harassment and gross insubordination. Employees may claim compensation if their dismissal is unfair.
Reporting obligation in connection with cessation and changes to employment circumstances
In the event of cessation or changes to employment circumstances, you as employer must submit the necessary information to the Norwegian Tax Administration, Statistics Norway and NAV via the a-melding.
Employees whose employment ends following lawful termination of their employment are entitled to a written reference. References must state the employee's name, date of birth, duties and duration of employment. Employees are entitled to request a more comprehensive reference concerning employment where this is common. Employees who are dismissed are also entitled to a reference, but the employer is entitled to state in the reference that the employee has been dismissed.