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From 1 January 2024, several new rules were introduced in the Working Environment Act that entail increased responsibility for employers who are part of a group.
The new rules strengthen employee protection and rights in connection with restructuring and downsizing where the employer is part of a group. As an increasing number of companies in the Norwegian labour market are part of groups or group-like structures, it is assumed that these expanded employer obligations will be of great importance in practice.
Extended obligation to offer other suitable work
In the event of downsizing or reorganisation, the obligation to offer other suitable work to employees who are being considered for redundancy will be extended to apply to any Norwegian company that is part of the Group. Previously, the obligation to offer other suitable work has been limited to the company in which the employee is employed.
This means that an employee cannot be dismissed in connection with a downsizing, if there is another suitable position in the Group. The obligation will be limited to other suitable work that is available in the Group at the time in question. The employer is not obliged to create new positions for employees in other companies in the Group.
The obligation is intended to be «secondary», which means that it will only be relevant in cases where it is clear that the employer cannot offer other suitable work in its own organisation. The amendment does not change the material conditions for dismissal.
Extended preferential rights for employees
Employees who have been dismissed due to the company's circumstances have, provided that the employee is qualified, a preferential right to new employment. Previously, the preferential right only covered the organisation the employee worked for, but the change in the law extends the preferential right to the entire Group.
The amendment requires that vacant positions in the Group must be made available in an appropriate manner for employees who have been dismissed. The employer must also inform the employee in the letter of termination that the preferential right applies to other companies in the group, and which companies these are at the time of termination.
Extended duty to inform and discuss
Rules relating to information and dialogue in group relationships are also introduced. The amendment means that in groups with at least 50 employees, a framework must be established for co-operation, information and discussion between the group and employees across the businesses.
This form of cooperation must be established in consultation with a majority of the Group's employees or trade unions that represent a majority of employees. The purpose of the legislative amendment is to strengthen employees' real opportunities to participate in the Group.
Consequences for employers in groups
The legislative changes will primarily have an impact on reorganisations and downsizing processes in large groups. Halvorsen & Co AS assists both employers and employees in connection with such processes. If you are unsure what impact the legislative changes will have on your company or your position, you are welcome to contact us for a closer chat.
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Lotte Lundby Kristiansen
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