At a glance
- In our monthly Norway Employment Law bulletin our employment lawyers highlight relevant news and trends on the Norwegian employment market scene.
- The bulletin intends to provide high-level knowledge and insight.
Aviation industry and transfer of undertaking
On 30 September 2022 Gulating court of appeal ruled on whether the change of a ground handling service provider on several Norwegian airports constituted a transfer of undertaking ("TUPE transfer") in accordance with chapter 16 in the Norwegian Working Environment Act ("WEA"). The matter concerned the transfer of ground handling services on behalf of SAS from SAS' previous service provider Widerøe Ground Handling to Aviator Airport Alliance. For the TUPE-regulations in the WEA to apply, the business transferred has to be an autonomous unit that retains its identity after the transfer.
The majority of the judges in the court of appeal found that the transfer did not constitute a TUPE transfer as the "autonomous unit" requirement was not fulfilled. The basis for this conclusion was, according to the court, that no specific teams of employees employed by, or equipment owned by Widerøe were assigned to service SAS only. Further, Widerøe Ground Handling continued to offer their services to other aviation companies after their loss of the SAS contract, hence the SAS contract was not so material in size that the transfer of the contract itself was sufficient to establish that an "autonomous unit" had been transferred.
In addition, a unanimous court of appeal found that the "identity" requirement was not fulfilled as Aviator Airport Alliance had only taken over a limited amount or employees from Widerøe (8.57% of the Widerøe employees in Bergen) and these employees were not specially trained to handle SAS flights. Further, no equipment or IP was transferred from Widerøe to Aviator.
Proposal for additional employer’s national insurance contribution in the upcoming fiscal budget
The Norwegian government have proposed to induce an additional employers’ national insurance contribution of 5 per cent for employees on salary exceeding NOK 750,000. The proposal will raise the current contribution rate from 14,1 per cent to 19,1 per cent. Players in the Norwegian business market within areas of finance, technology and aviation, including social partners through Confederation of Norwegian Enterprise (NHO) and Finance Norway, have openly opposed to the proposal. The additional employer’s national insurance contribution is said to be a temporary change to make up for the extraordinary large expenses in the state budget for 2023 and is proposed to be effective from January 2023.
Variable remuneration dispute in the Finance Sector
To be reviewed by the court of appeal in January 2023. Earlier this year, Oslo court of appeal issued a ruling on bonus payments in the finance sector, subject to special provisions on variable remuneration following the Financial Crisis in 2008. The regulatory framework aims to cope with unintended risk taking and sets rules for accrual and payment of variable remuneration such as cash bonus based on performance.
Two former employees of the company Odin Forvaltning took legal action against their former employer to receive bonus payments that they were awarded before they resigned from the company. The employees demanded to be paid bonuses from 2017, 2018 and 2019. Half of the bonuses had been paid out immediately, while the remaining half was placed in the company’s funds and deferred to be paid out on fixed dates over three years.
When the resignations were a fact, the company refused payment of the remaining parts of the bonuses with reference to internal guidelines governing the terms and conditions for deferred payments in the scheme. The internal guidelines gave the company the option to withhold bonuses if they had not been paid out at the time of a resignation. Oslo district court ruled in favor of the company, relying on said internal guidelines and the special terms of the company’s scheme. The case shall be considered by the court of appeal in January 2023 and will likely receive significant attention in the finance sector and asset management industry. Particularly because of the lock-up effect such schemes could have for employees who could be deprived of incentives they contractually may have been expecting.
