The rules of Norwegian employment contracts

Most foreign companies are surprised by how the employee protective Norwegian employment law is. If you are hiring employees to work in Norway, the starting point is the same—written employment contracts are mandatory and what you include in the contracts are regulated by law. From holiday and holiday pay, to working hours and dismissal rules, it all needs to be clear and precise. And mistakes can be costly. In this article, we'll explain the rules of Norwegian employments contracts, and why it is important to be compliant. 

Are written employment contracts required in Norway?

Yes. Section 14-5 of the Norwegian Working Environment Act requires all employment relationships to be documented in a written employment contract.

This is important for several reasons. If there is no contract and a dispute arises, the employee is still employed and protected in the same way as employees with written contracts, based on the regulations in the Working Environment Act. The risk of such uncertainty is the employer's responsibility, and any dispute will normally be interpreted in the employer's disfavour. 

How do written employment contracts protect your business in Norway?

A well-drafted employment contract is a tool to manage risk in an employment relationship. It establishes clarity and predictability for the employee and preserves the employer's freedom to manage. It ensures a balance between you and the employee, and leaves little room for misunderstandings and cause for conflict.

In the event of a dispute, Norwegian courts and the Labour Inspection Authority will look at the written employment contract first — and the better the contract, the stronger your position as an employer. 

Also read: Working hours in Norway – calculation based on a fixed average

Can I use my exsisiting employment contracts in Norway? 

Not without a review. The Norwegian Working Environment Act changes regularly, and you must ensure complete compliance, always. 

Standard contracts developed for other jurisdictions — or older Norwegian contracts — frequently fail to meet current Norwegian legal requirements. Using an outdated or non-compliant contract exposes your business to disputes where the missing or incorrect clause will almost always be interpreted against you as the employer.

The Norwegian Working Environment Act is amended regularly, and compliance is not a one-time exercise. Many foreign employers discover too late that their contracts contain clauses that no longer reflect Norwegian law, or are missing protections that have since become mandatory? 

Also read: Employment agreements in Norway—mandatory contract requirements

How to gain flexibility in a Norwegian employment contract?

In many cases, a standard employment contract may not cover all your needs, and different roles and positions may require customization. Perhaps you want the flexibility to change an employee's responsibilities without having to amend the contract each time. Or perhaps an incorrect payment in salary or holiday pay needs to be corrected — you need to make sure you have the right to do so.

In such cases, you should include clauses that secure flexibility and protect your rights as an employer, while staying aligned with Norwegian law.

Examples:

First, include a provision stating that the employee's workplace may be changed at the employer's discretion. This gives you the operational flexibility to redeploy staff where needed, without having to renegotiate individual contracts each time.

Second, include a clause entitling the employer to make deductions from salary or holiday pay in the event of an incorrect payment. Without this provision, recovering an overpayment from an employee is legally complicated — even when the error is obvious.

Also read: 9 things to remember for a foreign company hiring a Norwegian employee to work in Norway

What additional clauses should a Norwegian employment contract include?

Beyond the legal minimum, the following clauses are strongly recommended to protect your business and preserve your freedom to manage. Some are near-essential for most employers; others are situational depending on the role.

• Information on the company's pension and insurance schemes and that these may be changed / discontinued by the employer within the legal boundaries
• The company's retirement age
• Provisions on travel / dietary allowance
• Confidentiality
• Competition and no-hiring clause
• Information about the employer's right to extend probation
• Employer's right to make changes in the employment within the legal boundaries
• If the employee will have a position of managerial or other particularly independent  nature and be exempt from large parts of the provisions of the Working Environment Act related to working time
• Right to deduct salary
• Duty to return the company's assets at the end of the working relationship or long-term absence (e.g. leave and sick leave)
• Requirement to inform employer about other work / duties during employment which may affect the employment
• Rights to work results
• Restrictions to use assigned job email account for job related purpose only and information about employer’s access in accordance with applicable data privacy legislation
  
  

Get your Norwegian employment contracts right from the start

Norwegian employment law leaves little room for error — and even less room for ambiguity. For foreign companies hiring in Norway for the first time, the gap between a contract that works and one that creates problems is often a handful of clauses.

If you are employing in Norway, reviewing existing contracts for compliance, or adapting your standard agreements for Norwegian hires, our employment lawyers are here to help. We have solid experience with foreign companies operating in Norway and understand the practical challenges you face.