Redundancy in Norway

What rights do employees have on redundancy in Norway?

Employees in Norway have a number of rights in a redundancy situation. The employers need to follow correct procedures in order to avoid potential claims, and careful planning in redundancy situations is recommended to avoid additional burden of costly litigation and claims from employees.

Redundancy covers various situations. It could be closure of a business, closure of a workplace or reduction in a workforce, either throughout the business or at the relevant workplace.
Where the reason for the dismissal of an employee falls into one of these categories, it will amount to a redundancy dismissal.

The employee is not entitled to any redundancy payment according to Norwegian legislation. The employee is entitled to his/her ordinary salary and other benefits, according to the employment contract during the period of notice. However, the employee might challenge the dismissal, and claim that the dismissal is unfair. This could be based on the allegations that the employer has not followed a fair procedure according to Norwegian legislation, that the selection criteria is unfair or has not been followed, that the employees has not been consulted with prior to the dismissal. The employee has the right to remain in his or her position if he or she institute legal proceedings within eight weeks after completing the negotiations, or after the dismissal, and within the expiry of the period of notice, or inform the employer within the period of notice that legal proceedings will be instituted within the expiry of the eight week time limit. The right to remain in the post means that the employee’s right and obligation to work will continue, as will also the employer’s obligation to pay the employee. This right is maintained until the case has been decided by a final judgement from the court. An employer may, however, go to the courts and demand that the employee has to leave the post. Hence, many employers choose to offer the departing employees severance pay, in exchange for a release or waiver of liability for all claims connected with the employment relationship.

Employers have to comply with additional statutory obligations where they are planning a large number of redundancies. Where at least 10 redundancies are planned within a period of 30 days or less, the employer must consult collectively with appropriate employee representative about the redundancies.

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