Coordinated inspections against social dumping and undeclared work, Norway
Different public regulatory bodies have for a number of years carried out coordinated efforts against social dumping and undeclared work (Samordnede tiltak mot svart arbeid). In carrying out these inspections, the tax authorities, the Labour Inspection Authority and the police have worked together. In recent years, the construction sector has been targeted, among others, due to considerable problems witnessed in connection with the influx of foreign companies and employees in the sector.
A variety of regulatory bodies are involved in the efforts to combat undeclared work. Serious health and safety issues, as well as substandard wages and working conditions, are often seen in sectors of the economy and companies that depend on undeclared work. For some years, the Norwegian Labour Inspection Authority (Arbeidstilsynet), the Norwegian Tax Administration (Skatteetaten) and the police have carried out coordinated inspections in the construction sector. Similar measures have also been carried out in the hotels and restaurants sector, although targeting food safety as well as employment conditions and tax issues. The rationale behind such inspections, mainly organised as relatively extensive surprise inspections, is to monitor compliance with a number of different regulations. Sectors or companies with a high propensity for non-compliance are targeted in these types of inspections.
Coordinated actions are planned and implemented at local and regional level. Over the last few years, such actions have mainly been directed at the construction sector. In this case, the Labour Inspectorate has been assigned extended responsibilities due to regulations providing for the general application of national collective agreements in the construction sector – that is, in terms of the extension of collective agreements.
Coordinated inspections will normally be the responsibility of the local or regional bodies of the relevant authorities, either the Norwegian Tax Authority and/or the Labour Inspectorate, often in cooperation with the local police authority, the local office of the Norwegian Labour and Welfare Administration (NAV) and other organisations.
The objectives of the coordinated inspections are to combat social dumping, substandard wages and working conditions, as well as breaches of the tax regulations and undeclared work.
Specific measures involved include coordinated efforts by a number of public authorities as well as the campaign aspect of the inspections. The inspections link together inter-related issues such as illegal immigration, unregistered workers, working hours beyond the legal maximum, and tax evasion by employers or employees, and as such making inspections a more effective means of combating undeclared work. The campaign element means that a number of establishments within the same region will be subject to inspections at the same time, improving the potential for uncovering breaches of the various regulations. Media attention following such actions may also have a positive effect on the willingness of employers or employees to comply with tax rules.
Evaluation and outcome
Achievement of objectives
Coordinated inspections have been carried out for some years and are considered a success in that a number of breaches of the regulations are uncovered and thereby increasing the risk of getting involved in tax evasion. The government also lists coordinated inspections as one of the prioritised measures in their second action plan against social dumping presented in October 2008.
Obstacles and problems
So far, no specific obstacles and problems are associated with the inspections. It is however recognised that it may be difficult to gain insight into sectors of activity such as construction, as well as hotels and restaurant, and that this type of control inspection activity will not uncover all breaches of relevant regulations.
No overall evaluation of the initiative has been carried out to date. However, the various campaigns will be reviewed and evaluated.
It is widely recognised that it is difficult to monitor a sector with such a large number of foreign companies, posted workers on short-term employment contracts, as well as a complex structure of contractors, subcontractors and temporary work agencies. Therefore, a number of measures are introduced in order to improve monitoring and control of the construction sector.
No specific indicators have been identified. The inspections will be subject to reviews, for example, in terms of the number of companies controlled, number of employees controlled and number of violations.
It should be possible for the combined efforts of different public bodies in joint projects and inspections to be carried out in other countries.
Norwegian Ministry of Labour and Social Inclusion (Arbeids- og inkluderingsdepartementet, AID)
Petroleum Safety Authority Norway (Petroleumstilsynet, Ptil)
Norwegian Labour Inspection Authority (Arbeidstilsynet)
Norwegian Tax Administration (Skatteetaten)
Ministry of Labour and Social Inclusion, St.prp. nr. 1 (2008–2009), Second action plan to fight social dumping, Oslo, 2008, available online (in Norwegian) at: http://statsbudsjettet.no/upload/Statsbudsjett_2009/dokumenter/pdf/aid.pdf.
Kristine Nergaard and Jørgen Svalund, Fafo, Institute for Labour and Social Research