Yngvil Mortensen

foreignworkers@lomedia.no

What does laying off employees mean?

Employers can lay off employees if the company is reducing or shutting down operations for an extended period of time and needs to reduce its workforce.

High electricity costs, for example, could force the company to shut down operations for a certain period. 

High electricity prices have already forced a number of businesses to lay off workers.

If an employee is laid off, it will mean that she or he will either not work at all or will work fewer hours for a period of time.

Being laid off – or “permittering” in Norwegian – is not the same as taking a paid or unpaid leave of absence from your job, such as maternity leave for women who have given birth or leave to pursue another career.

Laying off employees is a temporary arrangement in which employees are told not to come to work while the employer is exempted from the obligation to pay their wages.

The employee’s contract of employment will remain in force, and the work halt is assumed to be temporary.

Your employer can lay you off for up to 26 weeks during the course of an 18-month period.

Read on to find out what pay and financial support you are entitled to while you are laid off.

Your boss must give you notice

Employers must provide written notice to employees who are being laid off 14 days before the layoff begins. In exceptional circumstances, this time limit can be reduced to just two days.

You must work as usual between receiving notice of the lay-off and the start of the lay-off, and your employer must pay you.

The employer’s lay-off notice must contain:

• Your name

• The reason that you are being laid off

• The date of the lay-off notice

• Date on which the lay-off starts and how long the lay-off will last

• Whether you are being fully or partially laid off

• The employer’s signature

Pay during the first 15 days

After the layoff begins, your employer must continue to pay you your regular salary for the first 15 days.

Many laid-off employees will be eligible for NAV unemployment benefits after the first 15 days.

Unemployment benefits are payments made to employees to compensate them for a portion of their lost income during periods of unemployment or layoff.

To be eligible for unemployment benefits you must register as a job seeker.

NAV recommends that you apply for unemployment benefits after you have been out of work for one week. You will have to wait about four weeks for NAV to respond to your unemployment benefit application.

Unemployment benefits are calculated from the date you filed your application with NAV. However, as previously stated, you will have to wait several weeks before the money is deposited into your account because applications take time to process.

Conditions for receiving unemployment benefit

There are several requirements for laid-off employees and others seeking unemployment benefits.

To be eligible for unemployment benefits while you are laid off, you must reduce your working hours by at least 50%.

To be eligible for unemployment benefits, you must have earned at least 167,216 kr in paid work in the previous 12 months, or a total of 334,431 kr in the previous 36 months.

The unemployment benefit is limited to just 62.5 per cent of your regular pay.

The maximum salary that can be used to calculate the 62.4 percent unemployment benefit is 668,862 kr. If your salary exceeds this amount, your unemployment benefit will not be calculated on the full amount.

This means that you can receive up to 417,000 kr in unemployment benefits before taxes.

Income includes parental benefits, pregnancy benefits, and pregnancy-related sickness benefits. Income received as a self-employed person is not counted as income.

What happens if I am dismissed with notice?

If you receive a termination notice, your layoff will end immediately. Your employer is required to pay you your salary from the date of dismissal and until the period of notice expires.

If a laid-off employee resigns from her/his position, she/he is not normally entitled to compensation from the employer.

Sources: Nav (Labour and Welfare Administration), Arbeidstilsynet (Labour Inspection Authority)

Translated by Robert Lovering.

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