Temporary work agencies required to register activities
The Norwegian government introduced a compulsory reporting and registration scheme for temporary work agencies in June 2008. As a result, the legal framework will also be altered making it illegal for employers to hire employees from agencies not listed in the new register. The purpose of the register is to promote responsible employment and business practices within the industry, particularly among foreign temporary work agencies.
In June 2008, the Norwegian government approved new administrative provisions relating to temporary work agencies. At the same time, a proposal for changes to existing regulations relating to companiesaeuroTM use of hired labour was also put forward. The purpose of these initiatives is to promote honest labour and business practices within this industry, which in recent years has seen great challenges particularly with regard to the operations of companies and temporary agency workers from the new EU Member States. The new regulations are expected to come into force during the autumn of 2008.
New provisions for temporary work agencies
Companies hiring out temporary workers in Norway will be subject to special rules with regard to their organisational form and structure, according to the new Administrative provisions relating to temporary work agencies (in Norwegian). Temporary work agencies are required to be organised as limited companies or public limited companies, or provide financial security in the form of a guarantee from a bank or insurance company of an amount equalling the minimum requirements for share capital in limited companies. This amount has been set at NOK 100,000 (about a,¬12,095 as at 3 October 2008).
Enterprises from other European Economic Area (EEA) and EU countries meet the requirements concerning company organisation if they are registered as limited companies or the equivalent in their home countries. Foreign companies operating in Norway must also have a representative based in Norway or appoint such a representative to act on their behalf. The appointed representative should be authorised to receive claims and perform legal acts on behalf of the company. Therefore, the person appointed as a representative will be a contact person for the company who can be easily reached in Norway.
A compulsory reporting and registration scheme for temporary work agencies has also been introduced. The Labour Inspectorate (Arbeidstilsynet) is responsible for keeping the new register up to date. Temporary work agencies are required to provide the Labour Inspectorate with information about the companyaeuroTMs name and address. Foreign companies must also provide information on the name and address of the companyaeuroTMs permanent representative in Norway. To be added to the register, an agency must also present documentation proving that it has been listed in the Central Coordinating Register for Legal Entities aeuro" which is the national Norwegian company register aeuro" as well as registered with the Norwegian tax authorities. Companies must verify on 31 January each year that they meet these requirements. Failure to do so will result in elimination from the register.
Responsibility of companies hiring temporary workers
The government has also proposed to introduce a supplement provision (in Norwegian, 270Kb PDF) to the Labour Market Act (Arbeidsmarkedsloven). This amendment will place a ban on hiring workers from companies that are not listed in the new register. Breaches of this ban aeuro" when introduced aeuro" will be punishable by a fine. The purpose of this initiative is to stop companies from using temporary agency workers from unregistered companies. This will both help to combat undeclared work or irregular activities as well as making sure that the Labour Inspectorate and others will be provided with a list of temporary work agencies with activities in Norway.
Reactions of social partners
The social partners have welcomed the changes made to the regulatory framework. The National Federation of Service Industries (NHO Service), the services sector branch of the Confederation of Norwegian Enterprise (NA|ringslivets Hovedorganisasjon, NHO) aeuro" organising many temporary work agencies in Norway aeuro" emphasises however that it is also important to supplement regulatory changes with control measures. NHO Service fears that negligent companies are damaging the reputation of the whole industry. Therefore, the organisation issued a consultative statement (in Norwegian, 73Kb MS Word doc) highlighting that it would like to see a certification scheme being introduced for such companies. The trade unions also believe that the regulatory framework could be further tightened in order to prevent substandard working conditions within the industry.
The purpose of the new rules is to deal with more dubious parts of the temporary agency industry, especially companies hiring workers from the new EU Member States. A duty to report and register companies operating in Norway will make it easier for the Labour Inspectorate, as well as other regulatory bodies such as the tax authorities, to monitor and control compliance with the regulations by temporary work agencies.
Kristine Nergaard, Fafo Institute for Applied Social Science