Norway is a nordic country in northern Europe, located in the Scandinavian Peninsula. It is bordered by Sweden, Finland, and Russia, and includes the remote Arctic island of Jan Mayen and archipelago of Svalbard. Norway is known to be one of the world’s happiest, most developed, and wealthiest nations.

Types of Contracts

Common employment contracts in Norway are:

Indefinite/Permanent Contracts: The most common type, offering job security and stability.

Fixed-term Contracts: Used for temporary positions and specific projects. There are restrictions on the duration and renewal of these contracts.

Part-time Contracts: Allowed and governed by the same rules as full-time contracts. Part-time employees should not be treated less favorably than full-time employees unless justified.

Job Title Restrictions

There are no specific restrictions on job titles. Job titles should reflect the actual job functions to avoid misleading titles.

Working Hours

The maximum number of working hours in Norway is 9 hours per 24 hours, 40 hours per 7 days.

Maximum permissible overtime is:

• 10 hours over 7 days;
• 25 hours over 4 consecutive weeks;
• 200 hours over 52 weeks.

Overtime must be compensated with an additional 40% of the normal hourly rate. Employers must monitor and record employees' working hours.

Minimum Wage

There is no general minimum wage in Norway. There are, however, sector-specific minimum wages.

Probation Period

Probation is not mandatory but is commonly used. The minimum duration is typically 3 months, and the maximum is 6 months.

Termination during the probationary period is possible without following the strict termination process under specific circumstances, such as the employee's adaptation to the work, professional competence, or reliability.

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Taxes & Local Employment Costs

Employee Taxes

Taxes: Employees pay Income tax based on their level of salary starting from a minimum rate of 22%.

Social Security: Employees whose income is not above NOK 69,650 are exempt from social security contributions.

For qualifying employees, the contribution ranges between 5.10% to 8.20%. The contribution cannot be more than 25% of an individual’s income.

Employer Taxes & Contributions

Employer National Insurance (Class 1 Secondary)

Social Security: The employer’s contribution to Social Security is 14.1% of an employee's salary up to 850,000 SEK per year. Above this threshold, the contribution rate is 19.1%. The contribution funds social benefits such as sickness benefits, parental benefits, disability benefits, and pensions.

Mandatory Occupational Pension contribution is a minimum of 2% of the employee's gross salary.

Work Accident Insurance is required for all employers.

Annual Leave

In Norway, the terms "annual leave" and "holiday leave" are used interchangeably to refer to paid time off from work for vacation or leisure purposes.

Employees in Norway are entitled to a minimum of 25 days of annual leave, and holiday pay amounting to 10.2% of the previous year's remuneration. Employees typically take 18 consecutive working days' holiday leave from June 1st to September 30th. The remaining 7 days can be taken together.

Employees aged 60 or above are entitled to an additional 6 days of leave. The length of service does not affect the number of leave days.

Employees are entitled to holiday leave regardless of entitlement to holiday pay.   However, they may refuse to take leave if not entitled to holiday pay.

Notice of Holiday Leave:

Employers must discuss holiday dates with employees in advance. Changes can only be made due to unforeseen events. An employee is entitled to compensation for documented additional expenses relating to the changes.

Calculation of Holiday Pay:

Holiday pay is based on the previous year's remuneration, excluding certain payments and benefits. Holiday pay is 10.2% of the previous year's remuneration, rising to 12% if 5 weeks of holidays are agreed upon. Employees over 60 receive 12.5% of a portion of their remuneration.

Payment of Holiday Pay:

Holiday pay is typically paid on the last normal payday before the holiday. Employees can demand payment one week before the holiday begins. If holidays are split, pay is split accordingly.

Unused holiday pay is typically paid on the first normal payday after the holiday year ends. Upon termination, all holiday pay entitlements are paid on the last normal payday before leaving the position.

Leave carry-over:

The right to transfer untaken leave days must be agreed upon in writing, allowing up to 12 days to be carried over. Cashing out leave is not standard practice except at contract termination when unused leave and accrued holiday pay are compensated.

Sick Leave

Employees are entitled to sick leave for up to 52 weeks. The first 16 days of sick leave are paid in full by the employer.

Maternity Leave

Employees are entitled to 49 weeks of leave with 100% pay or 59 weeks with 80% pay. Leave can start up to 12 weeks before the due date.

Maternity leave is paid by the National Insurance Scheme.

Paternity Leave

Fathers are entitled to 2 weeks of unpaid paternity leave in the event of childbirth or adoption. During paternity leave, fathers are entitled to receive parental leave benefits from the Norwegian Labor and Welfare Administration.

Shared Parental Leave

Parents can decide to split maternity leave between the father and the mother, however, 3 weeks prior and up to 6 weeks after delivery are preserved for mothers.

Bereavement Leave

Bereavement or compassionate leave is common but not mandatory.

Public Holidays

Please refer to the Remofirst platform for up-to-date information on Public Holidays.

Public Holiday Work: Employees who work on a public holiday are entitled to receive additional compensation in the same way as if they worked on a Sunday.  Typically in the form of extra pay or additional time off. Extra pay is 100% of the normal rate.

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Benefits

Statutory Benefits

In addition to statutory leave, employees are entitled to the following statutory benefits:

• Medical cover through the government's National health insurance;
• Government old age insurance;
• Supplementary pension provided by the employer;
• Work injury insurance.

Non Statutory Benefits

Common non-statutory benefits include:

• Private health insurance;
• Private pension;
• Performance based13th cheque;
• Work-from-home flexibility.

Process

Employment contracts can be terminated with just cause (such as dishonesty, negligence, fraud, or other work offenses). Before the decision to terminate is finalized, employers are required to discuss the intention to terminate with the employee.

Notice Period

The notice period for employees below the age of 50 varies based on their length of employment:

• During probation = 14 days notice
• 0-5 years = 1 month notice
• 5-10 years at the company = 2 months notice
• 10+ years at the company = 3 months notice

The notice period commences on the first day of the month.

Employees who are 50 and above and have been with the same organization for 10 or more years are entitled to the following notice:

• Employees 50-55 years old = 4 months notice
• Employees 55-60 years old = 5 months notice
• Employees 60+ years old = 6 months notice

Employees can be paid in lieu of notice if both parties agree. The payment should cover the wages the employee would have earned during the notice period.

Severance Pay

There are no provisions for severance pay in Norwegian law. Any unused leave must be paid out with the employee’s final salary payment.

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