Norway: The role of governments and social partners in keeping older workers in the labour market

  • Observatory: EurWORK
  • Topic:
  • Social dialogue,
  • Sustainable work,
  • Working conditions and sustainable work,
  • Inequality,
  • Industrial relations,
  • Collective bargaining,
  • Agreements,
  • Published on: 02 June 2013

Tom Erik Vennesland and Kristine Nergaard

Disclaimer: This information is made available as a service to the public but has not been edited by the European Foundation for the Improvement of Living and Working Conditions. The content is the responsibility of the authors.

The Norwegian employment rates among older people are among the highest in the OECD area, and older peoples’ employment activity has increased since the end of the 1990s. Extensive tripartite cooperation on policy measures and agreements such as the IA-agreement, the work of the Centre for Senior Policy, as well as previous reforms and initiatives, have contributed to keeping older workers in the labour market for a longer period of time. The social partners stress that employers need to adapt the working situation to each individual older employee’s needs.

1. National background and policy context – the main issues encouraging or preventing the extension of working life in your country

1.1 What are the main barriers in your country for the extension of working life?

In Government White Paper nr. 6 2006-2007 on senior policy (government white Paper, in Norwegian) main barriers against the extension of working life are pointed out. Economic wealth and the opportunity to leave early without taking substantial economic risks are important factors. Health problems are another important factor and the share of people on disability pensions is high among elders. Other important factors contributing to older workers leaving working life early, are poor working environment, as well as lack of competency among older workers. In addition, stereotypes and discrimination of older workers are seen as a considerable barrier, although it is hard to estimate its scope. These barriers had previously been pointed out by an expert panel which delivered its report in 2005 (expert panel). The panel also pointed out barriers related to lack of knowledge among older persons themselves about the positive effects of activation, as well as lack of knowledge on the personnel management side about the competence of older workers and the economic benefits of having adequate senior- and active ageing policies.

1.2 In general, what are the main existing policies and other contextual elements contributing to the extension of working life?

Working conditions related aspects

The tripartite agreement on a More Inclusive Working Life (the IA-agreement 2010-2013, in Norwegian) 2001 stressed ambitions and efforts to prevent early retirement and to increase the recruitment and retention of older workers at company level. (See section 2.6.). In addition the agreement has introduced a number of measures and obligations to prevent long periods away from work connected to sick leave. Both the IA agreement and other previous tripartite campaigns (see section 2.4. on The National Initiative on Older Workers) have particularly emphasized the need for attitude change among managers and younger and older employees.

Social and labour market aspects

The Norwegian employment rates among older people are among the highest in the OECD area, and the unemployment rate among older workers is low. The ambitions are still to prolong working lift careers among older workers. The Norwegian pension system was reformed in 2011, with the ambition to create stronger economic incentives for people to work longer (NO0611019I). The accumulation of pension rights is calculated on the basis of each year in employment, and employees who remain in employment for longer will benefit more than those with a shorter working career. Even if the reform means that employees can retire from the age of 62 years (a universal early retirement scheme is introduced), this will have a substantial effect on annual pension payments – especially for employees with short employment careers. The reform also makes it easier to combine early retirement pensions and part time work. It is expected that this will have effects in the years to come.

Furthermore, the government-funded, and social partner driven, Centre for Senior Policy actively spread knowledge on older workers and senior policy to the actors in Norwegian working life through an easily accessible information base on the internet, networking, training courses and conferences, and through funding research on the subject.

2. Policies promoting prolongation of working life through the improvement of quality of work

2.1 Developing skills (Training, lifelong learning)

Lifelong learning is often seen as particularly important for older employees with little education and other groups who are especially exposed to social and economic changes. Research on continuing education in Norwegian working life has shown that older workers are less likely to participate in different continuing education programs (Fafo-report from 2004, in Norwegian). This may be due to lack of motivation to participate in longer educational programs. The Government white Paper nr 6 2006-2007 on senior policy also stresses that lack of competency is an important barrier against prolongation of working life in Norway.

Measures specifically directed at older workers

There are no measures on national level specifically directed at older workers. A survey among companies among companies with 10 and more employees shows that 29% say they offer their older employees different opportunities for skill- and career development (Fafo-report 2011:10 (In Norwegian)). the most common among such senior policy measures is training within working-hours (i.e. paid), 17% of the companies in the survey offer some type of training as part of their senior policy (Fafo-report 2007:37 (in Norwegian)). Another study focuses on “good practice” pointes to computer courses as examples of senior policies at company level (AFI-report, in Norwegian).

Research from 2007 has shown that 89 % of Norwegian companies with more than 10 employees have regular meetings with their individual employees (appraisal interviews) on a regular basis (Fafo-report 2007:37 (in Norwegian)). The survey further shows that 59 % of companies develop individual training plans (based on the appraisal interviews), while 44 per cent say that the life cycle perspective is addressed in these interviews.

General measures

The Government white Paper nr 6 2006-2007 on senior policy stresses that a healthy working environment, as well as opportunities for competence development is crucial for employees’ opportunities to stay longer in work. Research on senior policy and retirement age also stress that such measures cannot be restricted to seniors, i.e. training throughout the working life influence the choices older employees make regarding early retirement or not.

Since 1990-2000 Norway has implemented several measures to promote training and lifelong learning. Some of these measures, i.e. measures directed at employees on low skill levels/without secondary/higher education, are in principle very relevant for a group of older employees who are vulnerable.

Facilitation of adults’ opportunities for Continuing Education was central in the Competence Reform of 1999 forwards (On the reform, Kompetansereformen, in Norwegian). The reform included different schemes aimed at making it easier for adults to resume schooling. Amongst other, the reform gave adults statutory rights to finish primary- and secondary education, and employees who have been in the labour market for at least three years are entitled to full or partial (unpaid) study leave from their employers in order to participate in organised education (NO0804049Q).

Statistics have shown that younger adults are overrepresented among the users of the different schemes. Persons aged 50 and over makes up 9 per cent of those who have participated in secondary education, while barely anyone in this age group have completed primary education as part of the program (Statistics from the Norwegian Agency for Lifelong Learning, Nasjonalt fagorgan for kompetansepolitikk, VOX). The reasons for this are compound. A Fafo-report (Fafo-report 2008:07 (In Norwegian)) points out that the lack of financing makes taking leave from work in order to finish education unacceptable for many adults. Numbers from VOX also indicate that adults’ lack of knowledge of their own rights and opportunities, as well as lack of facilitation from the providers of adult education (municipalities and counties) can explain the low participation numbers. 28 per cent of all adults in Norwegian universities were age 45 or over in 2010.

Measures directed at securing Basic Competence

The program for Basic Competence in working life (Program for basiskompetanse i arbeidslivet, BKA, in English) is a program for companies with employees who wish to increase their basic competence, such as reading and writing skills, numeracy and digital skills. The labour market organisations are also entitled to apply for funding. The measure comprises a limited number of people (6000-7000 per year). In 2010, 35 per cent of the participants were age 50 or over, while 9 per cent were age 60 or over. A first evaluation (based on the first year of the program), stresses positive effects, but points to the fact that the program in “under-used” among the sectors and companies where the formal qualifications in general are low Econ Rapport 2008-074 (In Norwegian). The evaluation here mentions smaller companies, and sectors where the employment level among the employees is low. However, over the last years BKA-initiatives have been taken in sectors such as retail trade and construction.

2.2 Health and safety and health promotion

Older employees are more likely to leave working life on permanent disability pensions compared to youger employees. In addition, many older employees choose to leave working life on other early retirement schemes, for reasons related to their own health situation. Before 2011 the early retirement scheme (agreement based early retirement pension) was based in collective agreements, meaning that employees in companies without collective agreements were not eligible. This scheme has been renegotiated as a consequence of the pension reform (NO0804039I, NO0906029I), and is a supplement to the state pension scheme, i.e. the national insurance scheme. It is too early to conclude on the effects of the new scheme. Estimates from the early 2000s show that around 75-80% of employees in the age-group 50-61 year were working in companies covered by the agreement based early retirement pension scheme (although individual employees might not be eligible since the scheme also have rules on employment period etc.). All public employees are covered by such schemes, whereas the coverage rate is lower in the private sector, especially among smaller companies. The private and public sector have different types of early retirement schemes, whereas the main private sector scheme covered most sectors (with the exception of finance sector which had their own scheme).

A summary report on “Extending working life” reports that among Norwegian companies that have policies for older workers, one out of every six report having special arrangements for older employees with health problems, and one out of four companies report having implemented special initiatives for the prevention of health problems. However, 50 per cent of Norwegian companies report having difficulties related to providing lighter or alternative work for employees aged 55 or over, while one out of three companies have difficulties related to providing part-time work to those in this age group who want it (Midtsundstad 2012).

The Norwegian Working Environment Act (Arbeidsmiljøloven) states that the employer has the responsibility for the adaptation of work situations, which also applies to older workers. In addition, many of the nationwide collective agreements specifically state that employers are responsible to adapt work situations to older employees.

Since the signing of the tripartite agreement on a More Inclusive Working Life (the IA agreement) in 2001 there has been a greater focus on adaptation of individuals’ working situations in Norwegian working life (for more on the IA-agreement, see Section 2.6.). The IA-agreement (the last agreement was signed in 2010) emphasizes that companies must work systematically with health, environment and safety issues and emphasizes the need for quick and more effective follow-up of employees who are out on sick leave. This also applies to older workers. One of the stated goals for the 2010 agreement is to increase the period in employment after 50 years with 6 months in average.

The IA-agreement from 2001 was followed up by the tripartite Declaration on Workplace Health Promotion in 2002 (Lillestrøm-erklæringen, in Norwegian) The declaration (a follow-up of the Luxemburg declaration of 1997) specifies overall conditions companies need to take into consideration when creating health promoting workplaces for all employees.

2.3 Work organisation related measures: flexible working time, career development and horizontal mobility

Extended holidays for older employees in the state sector

Since 2002, older employees in the state sector (age 62 and over) have had opportunities for taking extra days off work, through a provision in the main state sector collective agreement (up to 14 days per year). The arrangement was intended to contribute to that older employees would choose to stay longer in their work, instead of choosing to take advantage of early retirement schemes. An evaluation of the arrangement from 2010, sought to find out whether this objective had been reached (AFI paper 4/201 (in Norwegian)). The sample mainly consisted of employees over the age of 61 in the university sector. The evaluation showed that the seniors wanted the extra days off, in that the arrangement gave them extra flexibility and contributed to increased job-satisfaction. However, a majority reported that they found it hard to actually take the extra days off. According to the seniors, the extra days off, higher salary, reductions in working hours, as well as the perception of being appreciated by the management were the most important factors for them to choose to stay in their work longer.

Company level or local level arrangements with extra days off for older employees are also used in other sectors, especially in the municipal sector. A company survey among companies with 10 or more employees, showed that 12 % of Norwegian companies had arrangements for extra time off for older employees (Fafo-report 2011:10 (In Norwegian))

Reduced working time – trial-project in the state sector

In August 2007-July 2009, The Ministry of Government, Administration, Reform and Church Affairs (Fornyings-, administrasjons- og kirkedepartementet) conducted a trial-project in four state agencies, to investigate whether reduced hours with full pay-compensation contributed to senior workers choosing to delay retirement.

An evaluation of the trial-project showed that the reduction in working hours gave a small health benefit and increased job-satisfaction (Econ report 2010-044, in Norwegian). However, the arrangement implied that also senior employees who normally would work full-time chose to reduce their working hours. The evaluators concluded that this effect was so strong that an implementation of the arrangement would reduce the seniors’ total work effort. The trial-project has not resulted in any changes in the working time arrangements for older workers.

Older employees are entitled to part-time work (without wage compensation) though a 2008 amendment to the Working Environment Act (NO0807019I)

2.4 Initiatives related to socio-cultural change

The Centre for Senior Policy (Senter for seniorpolitikk), CSP) is Norway’s foremost proponent of socio-cultural attitudinal change of society’s general perceptions of older people. The social partner driven centre promotes research, arrange awareness initiatives and initiate a broad range of other activities. Among the awareness campaigns is the annual “Senior Initiative of the Year”-award (goes to an employer/a company with good practice), the distribution of information booklets, a web-site and a paper magazine and a special web-site for employers, employees and employee representatives VINN-VINN (win-win). The CSP also runs the Senior Policy Barometer (Seniorpolitisk barometer, summary of the barometer findings from 2011, in Norwegian). The barometer is based on surveys where both managers and the rest of the working population are asked questions relevant for senior political work. The barometer has attracted major media attention. Another example is CSP’s initiative to host a management course with a senior perspective in 2008. The course was attended by 90 line managers and HRM-representatives, and the feedback was very positive (on the course, in Norwegian).

National Initiative on Older Workers” (“Nasjonalt kraftak for seniorpolitikk”)

In 2001, the CSP was appointed by the government to coordinate the more extensive “National Initiative on Older Workers” (“Nasjonalt kraftak for seniorpolitikk”); a tripartite collaboration on national level. The initiative was a five year program aimed at 1) promoting awareness of the potential and resources of older employees, 2) providing a better and more inclusive working environment for all workers, and 3) creating more cooperation between social partners and the government concerning senior policy.

During the program period the CSP , amongst others, mobilized the employer- and employee-organisations, ran campaigns focusing on disseminating knowledge and information on senior policy, arranged 12 regional conferences on senior policy with 1700 participators representing 700 businesses, ran R&D-projects, established professional networks, arranged a conference for academic researchers on the field of senior policy and tried to establish an educational program on senior policy at university college level.

An evaluation of the initiative from 2007 found a number of effects of the initiative ( Statskonsult Report 2007-04 (In Norwegian). The evaluation points out that the initiative has been of special importance for the dissemination of information and knowledge on seniors and senior policy. Conferences, seminars, brochures and CSP’s extensive and well visited web site have contributed to put senior policy on the national media’s agenda. The R&D projects from businesses in both public and private sector have shown that processes involving use of personnel policy instruments can contribute to changing attitudes to older workers among older workers themselves, other employees and managers. For example the term “senior employee” was turned into a positive term, denoting experience and competence, not (only) being tired and worn out (the R&D project in the municipal sector), or that the “senior employee project” resulted in better knowledge of the instruments available as well as higher acceptance of individual adaptions and higher appreciation of the competence possessed by senior employees (the state sector).

The research projects, amongst others, contributed to establish the Senior Policy Barometer (Seniorpolitisk Barometer) which still provides annual measurements in areas of importance for seniors. On the negative side, the planned university college educational program on senior policy was dropped, due to a low number of applicants.

The evaluation points out that the general population’s attention to senior policy has increased in the period, amongst other through debates in the media. In the program period several political measures had been implemented, amongst others a ban on age discrimination in The Norwegian Working Environment Act, and the IA-agreement. However, there is uncertainty as to whether the media debate is extended to the workplaces and as to whether the general populations knowledge of seniors in working life has increased. The statistics from the period does not show any substantial increase in the employment rates for older workers in the period, but research conducted in the period demonstrated that businesses that make special efforts for their older employees also tend to have employees who choose to stay in work after the normal retirement age.

The evaluators recommend that the work with senior policy is continued, including the CSP’s role as a competence centre and driving force towards the government and the social partners.

2.5 Returning to work for unemployed older people

To our knowledge, there are no policies on national level specifically directed at improving unemployed older peoples’ access to the labour market. Analyses from the Norwegian Labour- and Welfare Administration (Arbeids- og velferdsetaten, NAV) show that the age group 50-59 years have the lowest risk of becoming unemployed (Press release from NAV 15 November 2010 (In Norwegian)). NAV provide a range of services aimed at getting unemployed people back to work. Long-term unemployed are a prioritized group, and older workers are over-represented among long-term unemployed. However, older unemployed workers are not committed to move in order to take up other employment.

2.6 Comprehensive programmes

More Inclusive Working Life

The declaration of intent to cooperate on attaining a Cooperation Agreement Regarding a More Inclusive Working Life (the IA-agreement) was originally signed on 3 October 2001 by the Government and the main social partners. The declaration has been extended several times, most recently until 2013 (See NAV web-page for the 2010-2013 agreement in English). On the basis of the IA agreement, the Government and the social partners have committed themselves to establish a more inclusive labour market for the benefit of the individual employee, the workplaces and society as a whole. The agreement is intended to prevent and reduce sickness absence, enhance job presence and improve the working environment, as well as to contribute to extension of working life for older employees. The Government’s main instruments with regard to the latter intention have included information and counselling services. These have been provided under the auspices of the Norwegian Labour- and Welfare Administration’s labour centres, as well as in the form of support from the Centre for Senior Policy (CSP).

All employers in Norway are called to sign up (voluntary). The IA-enterprises commit themselves to work systematically in order to achieve more inclusive work places. In return, the IA-enterprises get access to rights, provided by national authorities through the labour centres, reserved for companies that have signed the agreement (NO1106019I; NO0809059I, NO0110107F).

An evaluation from 2009 (Evaluation reports from SINTEF), demonstrated that the national target to increase the expected retirement age by 6 months in the period 2001-2009 has been reached. To which degree this is due to the IA-agreement’s focus on seniors, on other measures or on conditions in the labour market is not clear. According to national experts, the increase is probably due to a combination of these factors. In addition, the evaluation points out that IA-enterprises’, to a larger extent than other companies, seem to have active senior policies.

3. Views of Social Partners on the role of working conditions for keeping older workers in the labour market

The social partners are involved in measures such as The Centre for Senior Policy and the Cooperation Agreement Regarding a More Inclusive Working Life, and there are general agreement among the social partners on the importance of these measures. This also applies to the importance of schemes such as the program for Basic Competence in Working Life.

In a report from 2011, The Norwegian Confederation of Trade Unions (Landsorganisasjonen, LO) emphasize the need for managers to have knowledge of the IA-agreement, as well as knowledge of the individual senior worker and his/hers need for career guidance and competence development (report, in Norwegian). The Confederation of Norwegian Enterprise (Næringslivets Hovedorganisasjon, NHO) stresses that senior-policy on company level must be flexible and adapted to each individual senior. Furthermore, NHO’s department director Liv Ragnhild Teig has stated that motivation and adaptation of the working environment to older workers’ needs is just as important as more pay and extra holidays (statement from department director Liv Ragnhild Teig from 2011, in Norwegian).

4. Commentary

Norwegian policies on older workers in the labour market are partly based on incentives in the pension reform (not discussed here), partly on measures to prevent exclusion of older employees and partly on policies intended to increase awareness among employers/companies of the benefits of keeping older employees. It is also recognized that measures such as good work environment and lifelong training have to be applied in a longer perceptive than just for the “senior age”. Over the last decade the awareness of the positive contributions from older workers have increased, as have the general policies on an inclusive working life (following up on employees on sick-leave, individual schemes/facilitation).

The social partners have been strongly involved in encouraging policies to encourages employment among older workers, especially since the early 2000’s when a range of different active ageing policies were implemented.

Tom Erik Vennesland and Kristine Nergaard, Fafo Institute for Labour and Social Research


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