Termination of employment in Norway

Termination of employment in Norway

Norway enforces detailed regulations to protect employees in termination cases. Dismissal must always be justified and follow clear procedures.

Grounds for termination

Employers in Norway can dismiss employees only for specific, well-documented reasons.

• Economic redundancy due to business needs
• Personal reasons such as misconduct or inadequate performance
• Mutual consent with a written termination agreement

Dismissal for economic reasons requires that the company demonstrates genuine need for organizational changes. The employer must consider alternatives and offer other available roles if possible.

For dismissals based on conduct, employers must show evidence of serious or repeated breach of duty. Poor performance terminations must follow attempts to address issues, including guidance and support for improvement.

Termination procedures

Strict legal procedures apply to employment termination. Employers are required to give written notice and follow a clear process.

• Hold a meeting with the employee before formal notice, unless declined by the employee
• Deliver the notice in writing to the employee personally or by registered mail
• Provide clear reasons for dismissal if requested

The notice period begins on the first day of the calendar month after the employee receives the notice.

If the formal requirements are not met and the employee files a claim within four months, the termination is generally considered invalid unless an exception applies.

Notice periods

Notice requirements differ based on the employee’s service time and age.

• Minimum notice period is one month
• Two months for employees with at least five years’ service
• Three months for employees with at least ten years’ service
• Four months if employee is 50–54, five months if 55–59, six months if 60 years or older with at least ten years’ service

Employees wishing to resign must provide written notice according to the agreed or statutory period.

Summary dismissal

Immediate dismissal is allowed only in cases of severe misconduct or gross breaches of duty. In such cases, employment ends at once without further notice.

Temporary layoffs

Layoffs may be used if there is a temporary reduction in demand or production.

• Employer must consult with elected employee representatives
• Employees must be notified at least 14 days in advance (2 days for force majeure events)
• Ordinary pay is required for the first 15 working days

After this period, employees may receive unemployment benefits from NAV, provided the situation is outside employer control. The right to benefits does not arise if layoffs are due to the employer’s own decisions or conduct.

If the layoff lasts more than 26 weeks, the employer’s obligation to pay wages resumes.

Employee protections

Several groups receive extra protection from dismissal.

• Employees on maternity or parental leave
• Pregnant employees or those on sick leave due to pregnancy
• Employees fulfilling compulsory military service

Dismissing protected employees is possible only with particularly strong justification and must not relate to their protected status.

Collective redundancies

For collective dismissals (usually 10 or more employees), the employer must consult with employee representatives and document the need for workforce reduction.

• Selection criteria must be objective and reasonable (skills, seniority, social factors)
• Employees must be informed about legal rights, the reason for dismissal, and preferential rehiring rights

The employer must consider possible options to prevent redundancies, such as reassignment or job adaptation.

Severance pay

Norwegian law does not mandate statutory severance pay. Severance may be offered as part of settlement agreements, especially where courts may be involved and litigation is likely to be lengthy.

Disputes and employee rights

If an employee disputes a dismissal, they can remain in their position until the court settles the case, unless the court finds otherwise. This right applies to ordinary dismissals but generally not to summary dismissals or employees hired temporarily.

When a termination is found to be unlawful, courts may award compensation or reinstatement. Compensation is usually based on lost income and can include damages for non-economic loss.

Unemployment benefits

Laid-off or dismissed employees might qualify for unemployment benefits from NAV, Norway’s welfare agency. Eligibility is subject to requirements including recent income levels, loss of over 50% of working hours, job search activity, residence in Norway, and being a member of the National Insurance Scheme.

Grievance procedures

Before dismissal, employers must invite employees to a preliminary interview. This meeting allows the employee to respond and possibly resolve the issue. If the employer proceeds, all reasons for dismissal must be explained in writing.

FAQs

What are valid reasons for dismissing an employee in Norway?

Valid reasons include company reorganization, economic redundancy, serious misconduct, or inadequate performance. Dismissal must be objective, documented, and based on real business or conduct-related grounds. Mutual consent terminations are permitted by written agreement.

How much notice must employers provide before dismissal?

Minimum notice is one month. For employees with more years of service or higher age brackets, the period increases up to six months. Exact notice periods depend on seniority and age, with longer tenures and older employees receiving longer notice.

Can an employee challenge their dismissal?

Yes, employees can dispute a termination and remain in their job while the dispute is resolved in court. If the dismissal is found unlawful, they may be reinstated or awarded compensation based on actual losses.

Is severance pay required in Norway?

No statutory rule requires severance pay in Norway. It may be negotiated as part of an agreement but is not automatic unless specified in a contract or collective agreement.

What protections apply to employees on maternity or sick leave?

Employees on maternity, parental, or sick leave due to pregnancy have enhanced protection. Dismissal during these periods is allowed only with strong, clearly unrelated justification and must not be linked to their protected status.

What steps must employers take before collective dismissals?

Employers must consult with employee representatives, present objective selection criteria, seek to avoid redundancies, and inform staff of their legal rights. The entire process must be transparent and documented to comply with legal requirements.