Factsheet for case NO-2020-12/720 – Updated – measures in Norway
|Country||Norway , applies nationwide|
|Time period||Temporary, 20 March 2020 – 01 July 2021|
|Type||Legislations or other statutory regulations|
Supporting businesses to stay afloat
– Direct subsidies (full or partial)
|Author||Aasmund Arup Seip, FAFO and Eurofound|
|Case created||17 April 2020 (updated 19 July 2021)|
|Related ERM support instrument|
The regulation of lay-off is amended to reduce employers' costs of lay-off so that they can better adapt to market failure and avoid permanent dismissals. Many businesses are required to shut down, and the ripple effects of measures to limit infection are significant. This has resulted in a very high number of layoffs in a number of industries. The amendment to the lay-off regulation reduce the cost for employers and increase the unemployment benefit for the unemployed. Part time lay-off can be applied if the employee work 40% or less (changed from 50%).
The lay-off regulations secure unemployment benefits to the individual employee if he or she is laid off. In this way, companies can quickly reduce their costs, while at the same time the working relationship can continue. The period where employers have to pay wages during lay-offs (the employer's period) is reduced from 15 to 2 days. The state carry the cost from day 3. The unemployment benefit starts when the unemployed person has been unemployed and has been registered as a real job seeker for at least three of the last fifteen days. These three days constitute the waiting period in the unemployment benefit scheme. To reduce the burden on workers the waiting time is removed for the laid off.
The temporarily dismissed are guaranteed 100% salary up to 6G (approx. €50,700) from day 3, when employer is exempted from paying wage, through day 20. Unemployment benefits for laid-off persons and those who become ordinary unemployed are adjusted upwards and shall constitute 80% of the former wage (dagpengegrunnlaget) up to 3G (aprox. €25,350) and 62.4% of the part of former wage that is between 3G and 6G (aprox. €50,700). The lower income limit for entitlement to unemployment benefit is lowered to 0.75G (aprox. €6,340) over the past 12 months or 2.25G over the past 36 months. The requirement for reduced working hours for entitlement to unemployment benefits is changed from a minimum of 50% to a minimum of 40%.
In the period from 9 March to 15 April, 342,228 people have applied for unemployment benefit. In accommodation and food and beverage services (NACE I) the unemployed constitute 57% of the employed in the industries. In industry (NACE C) and construction and building (NACE F), 12% is registered as laid off.
By June 2020, over 54,000 companies had received support through one or both of the measures. During 2020, 60,803 companies received money. Most companies (14,000) are found in wholesale and retail trade (NACE G), followed by 6,000 companies in construction industry (NACE F). Accommodation and food service activities (NACE I) and Professional, scientific and technical activities (NACE M) each had 6,000 companies receiving support through the wage support measure and/or payment to laid off employees. (See statistics on business policy instruments at Government’s web site: regjeringen.no .)
||Does not apply to businesses||Does not apply to citizens|
Public employment service
Social partners' role in designing the measure and form of involvement:
|Trade unions||Employers' organisations|
|Form||Direct consultation outside a formal body||Direct consultation outside a formal body|
Social partners' role in the implementation, monitoring and assessment phase:
The social partners have been consulted regularly during design and implementation of the measure.
The social partners support the changes to the employer period made in June. However, the Confederation of Norwegian Enterprise (NHO) and the Norwegian Confederation of Trade Unions (LO) have written to the PM and the Minister of Labour and Social Affairs, and requested that the government extend the layoff period from 26 to 52 weeks when the temporary prolongation for those who were laid off in March and April expires at the end of October.
Eurofound (2020), Temporary amendment to the regulation of layoffs , case NO-2020-12/720 (measures in Norway), COVID-19 EU PolicyWatch, Dublin, http://eurofound.link/covid19eupolicywatch
Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process. All information is preliminary and subject to change.