Agreement between LO and NHO on amendments to the Basic Agreement

In November 1997, following negotiations, Norway's LO trade union confederation and NHO employers' organisation agreed to recommend a proposal for a revised Basic Agreement. One of the proposed amendments is that economic sanctions may be introduced if the Agreement's clauses regarding information and consultation are not complied with. The parties have also included a clause stipulating the minimum number of members a union federation must have in order to be eligible to demand the right to negotiate a collective agreement.

On Thursday 13 November 1997, the Norwegian Confederation of Trade Unions (LO) and the Confederation of Norwegian Business and Industry (NHO) agreed to recommend a proposal to amend their Basic Agreement (hovedavtale). The two organisations' representative bodies must approve the new Basic Agreement and it will be on the agenda at LO's general council on 10 February 1998, while NHO's central board will deal with the issue on 11 February 1998. The new Agreement will, as usual, be of four years' duration. It is expected that the revision of the LO-NHO Agreement will have an impact on other Basic Agreements between trade union and employers' organisations, particularly within the private sector.

The Basic Agreement between LO and NHO

The Basic Agreement negotiated by the two main confederations is included as Part I in all collective agreements between LO-affiliated trade unions and NHO-affiliated employers' federations covering workers in establishments affiliated to NHO. The first Basic Agreement between LO and NHO's predecessor, the Norwegian Employers' Confederation, was signed in 1935. Other parties in the private sector have since then agreed to their own basic agreements, which to a large extent are based on the same principles as those found in the LO-NHO Basic Agreement.

The Basic Agreement complements Norwegian labour law by defining the principal goals, as well as laying down a set of principles and procedures which regulate the relationship between the labour market parties. Amongst other issues, the question of sympathy industrial action is regulated in the agreement, while the statutory obligation to maintain industrial peace for the duration of an agreement is amplified. A number of issues regarding shop stewards, employee participation and information and consultation are also regulated in the agreement. The Basic Agreement also contains a "Cooperation Agreement" which regulates the activities of different coordinating bodies. This latter agreement also touches upon questions relating to how to develop the qualifications and skills needed in working life. A number of supplementary agreements are also attached to the Basic Agreement, covering issues such as guidelines for initiating work studies, equality between men and women, and framework agreements regulating control measures within the firms.

New clauses

The proposal for a new LO-NHO Basic Agreement contains a number of amendments. The most important are set out below.

  • The introduction of sanctions in the event of severe breaches of the duty to inform and consult trade union representatives with regard to the firm's ordinary operations, reorganisation or changes such as mergers, closures etc. Firms which do not comply with the Basic Agreement's clauses regarding information and consultation may be fined up to NOK 300,000. Trade union representatives may also be fined if they disclose confidential information to unauthorised persons. A committee, where each of the parties are represented by two members, will be established to resolve disputes over this question. A neutral member appointed by the State Mediator will head the committee. Fines which are levied will go to an LO-NHO development programme for firms (known as Hovedorganisasjonenes Fellestiltak Bedriftsutvikling, HF-B).
  • Minimum standards for how many members a LO-affiliated union federation must have in order to be eligible to demand the right to a collective agreement in a NHO firm, will be included in the new agreement. Until now it has been sufficient that a federation has had one member. According to the new agreement, the federation must organise at least 10% of the relevant employees before it can demand an agreement. There are certain exceptions from this rule, including firms with less than 25 employees. If there already exists an agreement in the firm, a new federation must organise at least 30% of the employees before it can demand an agreement which will cover the same groups of employees.
  • NHO won acceptance for its demand that during industrial conflict, LO is not only to take strike action against NHO-firms, but also against firms with the same types of agreements. This will basically affect firms with no affiliation to an employers' organisation, but which have an agreement which stipulates that a branch-wide agreement is to be followed.
  • The rights of trade union representatives at the overall concern level ("concern representatives") have been expanded. A specific concern representative may be elected in concerns with more than 200 employees. The rights and duties of trade union representatives set out in the Basic Agreement will also be made applicable to concern representatives.


In many ways the Basic Agreement represents the central parties' desire to have a well-defined relationship at the central level, as well as enhancing cooperation at firm level. Since the relationship between the labour market parties is regulated only to a limited extent through statute, the importance of the Basic Agreement becomes even more evident. The rights, duties and procedural rules laid down by the Basic Agreement are central to industrial relations in Norway. The other main element of the Basic Agreement, the Cooperation Agreement, makes it easier for the labour market parties to cooperate locally on a wide range of issues. This cooperation often encompasses joint actions to enhance organisational or productivity development. The agreement also reflects the central role which local trade unions play in representing employees in this type of cooperation in Norway.

The 1997 revision of the Basic Agreement has introduced several new types of clauses, and may therefore be one of the more important revisions of the agreement. Defining qualifying standards in order for a federation to be given the right to demand a collective agreement is one of the new types of clause. This reflects NHO's wish to ensure that its members are not obliged to enter into agreements in cases where there are very few organised employees. At the same time, the introduction of the clause which makes it more difficult for competing organisations to demand agreements may reduce union rivalry between organisations within and outside of LO, at least if this clause is also included in other basic agreements in private sector. Another new element in the Basic Agreement is the possibility of fining firms (and trade union representatives) which breach the agreement's information clauses. The possible levying of fines if the duty to inform is breached has been part of LO's demands during several renegotiations of the Basic Agreement. The fines which are to be collected will be used to enhance cooperation at company level. For NHO it was also important that, if LO takes industrial action, it should also be obliged to strike at those firms outside employers' organisations which nonetheless follow branch agreements - ie firms with an agreement which states that a nationwide LO/NHO agreement should be followed. By doing so, NHO hopes that these firms will not achieve a competitive advantage during industrial disputes. (Kristine Nergaard, FAFO Institute for Applied Social Science)

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