Looking for a PEO and EOR service provider in Norway? You've knocked on the right door! Our European PEO and EOR solutions help companies hire employees in Norway without establishing a legal entity. Hiring and employment in Norway can be complex as a foreign employer. We're here to guide you. EuroDev is the leading provider of EOR & PEO solutions in Europe. We partner with North American businesses that want to expand their business into Europe, including Norway. What should be taken into account when employing or hiring in Norway?
How it works - PEO in Norway & EOR in Norway
An Employer of Record (EOR) or Professional Employer Organization (PEO) is a company or organization that is legally responsible for paying employees, including dealing with employee taxes, benefits & insurances. As the EOR/PEO of your European or Norwegian employees, we provide you with tailored payroll, HR, and compliance services. Through this construction, we decrease all the complications such as compliance issues, setting up a foreign establishment, and setting up employment contracts in a different language.
Benefits of a PEO in Norway & EOR in Norway
- Expand without an entity
- Flexible and cost-effective solution to outsource payroll and HR functions for international expansion
- In compliance with foreign local laws & regulations
- Minimizes employment liabilities and risks
- Reduced risk, as the risks of being an employer fall almost completely on the employer of record
- Saves you time to focus on your core business
- You manage your employees
- EOR and /or PEO takes care of registration and contact with local authorities
Employment Contracts Norway
A written employment contract is legally required in Norway and must be concluded by signature within one month of the start of employment. This rule applies to all types of employment, whether permanent or temporary. There are no exceptions to this rule.
The employment contract must contain information on matters of vital importance to the contract, such as the employee's remuneration, benefits, and conditions of dismissal. Wages and other remuneration must always be stated in Norwegian krone rather than in foreign currency in the employment contract.
The employer and employee may agree that the first six months of an employment contract is a trial period. During this trial period, either party may terminate the employment at any time with at least 14 days' notice.
PEO and EOR service providers in Norway will support you with the set-up of a local employment contract.
Employment Termination Norway - Notice Period Norway
The legal notice period that an employer must give when terminating an employee varies from 1 to 6 months, depending on the term of employment, age, and length of service with the company. It is more common to agree to a 3 month notice period.
A dismissal must be objectively justified by circumstances relating to the operation of the business, the employer, or the employee. This applies to both individual and collective dismissals. Before making a decision regarding a dismissal with notice, the employer must discuss the matter with the employee and an elected employee representative, unless the employee himself does not wish to do so. Employees who give notice must generally comply with the notice period stipulated in their employment contract, which cannot exceed three months. Notice of termination must be in writing, contain precise information as required by law, and be delivered to the employee in person or sent by registered mail to the employee's home.
In the event of a serious breach of duty, either party may also terminate the employment for a cause with immediate effect, without observing a notice period. Valid reasons for immediate termination include crimes against the employer.
Social Security Norway
In Norway, both the employer and the employee are subject to mandatory employee contributions. Employers must pay social security contributions on 14.1% of the wages and other remuneration they are required to report. Employees must contribute 8.2%.
Average Salary Norway & Average Employer Costs Norway
In 2022, the average salary in Norway was $59.917,00. This is slightly higher than the average annual salary in the United States, which is $53,490.00. As an employer, the actual employer costs are approximately 14.1% higher than the gross annual salary. Based on an annual salary of $59.917,00, employment costs would be $68.305,61.
To learn more about the average salaries in Europe and the actual employment costs in Europe, we invite you to read this article on the Costs of hiring European employees.
Working Hours Norway
According to the Working Environment Act, the standard for working hours is 40 hours per week. However, the standard set in all collective agreements is 37.5 hours per week. For shift work, the standard working hours are shorter. Employees may be entitled to reduced working hours for health, social, or welfare reasons. The law also establishes the right to flexible working hours if this can be arranged without major inconvenience to the employer.
The employer is obliged to keep an account of the hours actually worked by each employee. Overtime must be compensated. All employees, with the exception of managers and staff in particularly independent positions, are entitled to at least 40% overtime pay.
Paid Vacation Leave Norway
All employees are entitled to four weeks and one day of paid vacation per calendar year. If the company is bound by a collective bargaining agreement, its employees are entitled to five weeks of vacation per year. Five weeks is the most common arrangement, even in companies that are not bound by a collective agreement. Employees aged 60 and over are entitled to an additional week of vacation.
The employer is required to consult with the employee(s) concerned or his or her union representative to set the vacation dates. If no agreement can be reached, the employer has the right to make the final decision, within certain limits established by law.
Paid vacations must be 10.2% of annual remuneration if the employee is entitled to the legal minimum annual leave; 12% if entitled to 5 weeks; and 12.5% for employees over 60 years of age. It is generally paid in June.
To learn more about the average paid vacation days in Europe and how Norway compares to the rest of Europe, we invite you to read our blog on paid vacation days in Europe.
Public Holidays Norway
Employees are legally entitled to have these holidays in Norway.
- New Year's Day - 1 January
- Maundy Thursday - 14 April
- Good Friday - 15 April
- Easter Sunday - 17 April
- Easter Monday - 18 April
- Labour Day - 1 May
- Constitution Day - 17 May
- Ascension Day - 26 May
- Whit Sunday - 5 June
- Whit Monday - 6 June
- Christmas Day - 25 December
- Boxing Day - 26 December
Maternity and Paternity Leave Norway
Parents are entitled to a total of 49 weeks of leave with full pay, or up to 57 weeks with reduced benefits, before the child's third birthday. This leave includes maternity leave. The father must have sole custody of the child to benefit from the 49 weeks. The three weeks before the birth are reserved for the mother (they are not part of the maternal quota). These 3 weeks do not apply to adoptions, which means that in this case, the total period is 46 or 56 weeks.
Unless otherwise specified in the employment contract, employers are not required to pay parental leave to employees during their leave; parental benefits are paid by National Security.
National Security does not pay parental benefits for wages above six times the Grunnpensjon or "G" amount. The limit was about NOK 608.000 in 2020
Employment contracts usually state that the employee is entitled to parental allowance payments from the employer if his or her salary is above this limit.
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Monique Ramondt Sanders
Executive Vice President | HR Outsourcing