Adecco to grant retroactive overtime pay

In October 2011 the largest recruitment company in Norway, Adecco, reached an agreement with two trade unions for the retroactive reimbursement of overtime pay for employees who were working in nursing homes in the counties of Oslo and Akershus. Several municipalities ended their contracts with Adecco following media allegations about unpaid overtime and extensive breaches of working hours regulations. The company has now closed its remaining nursing homes in Norway.

Background

In October 2011 the largest recruitment company in Norway specialising in temporary agency work, Adecco, signed an agreement with two trade unions to retroactively reimburse employees for overtime work carried out at three nursing homes it operated on behalf of the municipality of Oslo.

The two unions were the Norwegian Union of Municipal and General Employees (Fagforbundet), affiliated to the Norwegian Confederation of Trade Unions (LO), and the Norwegian Nurses Organisation (NSF), affiliated to the Confederation of Unions for Professionals (Unio).

The agreement followed revelations in February 2011 that Adecco had been systematically breaching regulations made under the Working Environment Act (2.09Mb PDF) in its operation of a nursing home in Oslo. The employees affected by the allegations were employed by Adecco Health AS and had reportedly worked many hours beyond the limits established in the legal framework without receiving overtime compensation. The allegations led several municipalities to terminate their contracts with Adecco, and the company decided to close all its nursing home operations in Norway (NO1104019I).

According to the Norwegian Broadcasting Corporation (NRK) the October agreement will secure the employees concerned overtime compensation for any work carried out beyond nine hours per day and 40 hours per week. About 120 members of the two unions will receive compensation worth between NOK 40,000 (€5,175 as of 3 November 2011) and NOK 300,000 (€38,800).

External Investigation into Adecco

Following the allegations Adecco decided to carry out an investigation of the company's operations in Norway. The assignment was given to a law firm, Wiersholm, and the summary report (in Norwegian, 1.51Mb PDF) was released in September 2011.

The investigation covered all parts of the company, although the legal violations it uncovered were mainly limited to Adecco’s health services. The investigation uncovered violations similar to those alleged in the media six months earlier – the violation of working time regulations and lack of overtime compensation in Adecco Health. The investigation also found unsatisfactory work contracts and illegalities relating to the accommodation of some employees.

The investigation also revealed that employees working for Adecco’s temporary placement service within the health sector were working excessive hours and had not been paid for voluntary overtime work.

The main reasons for these violations were, according to the report, inadequate control mechanisms and a lack of awareness of existing working time regulations. Based on recommendations from Wiersholm, Adecco has since implemented measures and systems to prevent this from happening again, as outlined in its own report (in Norwegian, 77kb PDF).

Investigations also found that in Adecco’s Construction and Industry Service there were some discrepancies with regard to overtime, where some workers had been doing too many hours. Here, however, employees had been compensated by additional payment.

Commentary

The investigation revealed that malpractice in relation to working hours and overtime compensation were most prevalent in Adecco's health sector service. There are signs that violations in this sector occur quite frequently, although it isn’t clear whether this is caused by problems peculiar to the health sector or is related to the extensive use of temporary agency workers.

In August 2011 it emerged that working time regulations were being violated in nursing homes in the city of Trondheim, both in local authority-run operations and in homes run by temporary work agencies – although the most serious violations were in those run by the agencies.

Kristin Alsos, Fafo