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Employer of Record in Norway

Employer of Record in Norway

Skuad’s Norway Employers of Record (EOR) solution helps your business expand into Norway without the need for an entity setup. Our unified and automated global HR platform enables you to expedite the onboarding of your remote team and manage their payroll, benefits, etc. We help you streamline the global expansion process with the able assistance of our international network.

Contact us to know more about our customized solutions in Norway.

Norway At A Glance

Norway is a Nordic country in northern Europe that shares its borders with Finland, Russia, Denmark, and Sweden. According to the World Bank, Norway has the fourth-largest per capita income.

Population: 5.3 Million

Currency: Norwegian Krone (NOK)

Capital city: Oslo

Languages: Norwegian, Sámi

GDP: $350 billion (2020)

Learn more about expanding your business into Norway by partnering with Skuad.

Employment in Norway

What You Must Know Before Employing In Norway

Norway employment laws apply to both foreign nationals and their citizens. However, there are some differences in their entitlements. Let us understand the differences and other aspects of employment laws in Norway.

Norwegian laws may look somewhat complex and confusing but are not much different from the employment regulations of many other countries. Nevertheless, to minimize or mitigate the challenges for companies looking to set up a local office, it is advisable to partner with a local payroll provider who is well aware of Norway Labor laws for local and foreign workers.

Entitlements Explanations
Statutory Working Hours 40 Hours over 5 days.
Overtime Eligibility

Only allowed in case of high urgency.

Overtime agreement with the employee’s representative:

  • 20 hours for seven(7) days
  • 50 hours for four(4) consecutive weeks
  • 300 hours for 52 weeks

Overtime permitted by Labor Inspection Authority

  • 10 hours for a week
  • 25 hours for four(4) consecutive weeks
  • 300 hours for 52 weeks

Overtime compensation is 140% of the hourly compensation.

Paid Public Holidays The public holidays in Norway for 2021 are as follows:
  • New Years Day (1 January)
  • Maundy Thursday (1 April)
  • Good Friday (2 April)
  • Easter Sunday (4 April)
  • Easter Monday (5 April)
  • Labor Day (1 May)
  • Ascension Day (13 May)
  • Constitution Day (7 May)
  • Whit Monday (24 May)
  • Christmas Day (25 December)
  • Boxing Day/ Second Day of Christmas (26 December)
Holiday Pay Holiday Pay gets paid before the holiday.
Medical Leave
  • Employers pay full salary for 16 consecutive days of sick leave. From the 17th day, the National Insurance Scheme pays the employee under the employee health benefits Norway.
  • Employees can take three consecutive days of sick leave without presenting a medical certificate. However, a medical certificate must be provided on the 4th day.
Maternity/Paternity Leave Female employees are entitled to paid maternity leave:
  • Before the birth: Upto 12 Weeks
  • After the birth: At least six (6) weeks.
  • Employees receive 100% salary for 44 weeks after birth. Afterward, 80% salary gets paid for the additional 12 weeks.

Male employees receive two weeks of unpaid paternity leave.

Annual Leave Accrual Entitlement
  • Employees in Norway receive 25 days of paid leave annually.
  • Every employee is entitled to three weeks of continuous leave between June 1 and Sept. 30.
  • Employees more than 60 years old receive 31 days
Employee Protection and Anti-discrimination Rights

Employee discrimination is prohibited under The Working Environment Act. It protects the employee against direct and indirect discrimination based on age, gender, race, belief, political opinions, religion, social, national ethnic origin, and sexual orientation.

Employers are prohibited to discriminate against part-time employees and full-time employees.

Learn more about employing talent in Norway at Skuad.

Contractors vs. Full-Time Employees

The contractors and full-time employees are assessed based on the following guidelines:

  • It is full-time employment if there exists an employment relationship. It includes fixed working hours, fixed monthly compensation, the provision that the employer directs the person’s work, and a notice period. To hire full-time employees, the company must qualify as a Norwegian employer. For full-time employees, the taxes get deducted by the employers from their paycheck. The employee’s tax is generally 14.1% of the salary. 
  • The person is a contractor if the work gets performed under their name at their discretion and risk. Their compensation gets reduced due to underperformance, and they work on their equipment at their premises. The tax liability of a contractor is 18% on the income. You can hire a contract employee for a short-term project. 

Learn more from Skuad experts about the nitty-gritty involved in hiring fixed-time contractors or temporary contractors.

Hiring in Norway

Employers mandatorily run a background check on the employee before hiring them. The background details include previous work history, education, and business interest. The employment contract law in Norway states that the employer must draft a written contract for the recruited employee within one month from the date of hire. The written employment contracts must mention the job description, compensation, benefits, working hours, overtime benefits, and a termination clause. 

The best places to search for companies hiring in Norway are:

  1. The Arbeidsplassen website provides the listing of jobs. However, the limitation is that it is only available in the Norwegian language. 
  2. To look for jobs in various languages, Eures is one of the top websites. 
  3. Gulesider is a website that shows job listings that might not be available on other platforms.
  4. Most jobs get listed on the Finn website. The only limitation is that it is in Norwegian.

Skuad is a Global HR platform for building remote teams. We enable companies to hire, onboard, pay, and manage their teams in over 150 countries. While the businesses focus on their growth, we take care of the employee contracts, payroll, compliances, and benefits. Our services get driven by our product which is a self-serve, unified, and automated HR platform.

Book a Demo with Skuad to hire Employees in Norway.

Probation & Termination

Probation Period

The standard probation period in Norway for the employee is six (6) months. At the end of the probationary period in Norway, the employee becomes eligible for benefits and entitlements. The same must be mentioned in the employment agreement Norway.

Termination Of Service

Topics Explanation
Notice For Termination Of Employment, Norway

If the employee or the employer decides to terminate the employment contract between the two parties, he must give notice to the other party in writing.

The tenure of the notice period varies depending on the length of employment.

Duration of Employment Notice Period
During Probation Period Fourteen(14) days
Less than five(5) years one(1) month
Five(5) years< ten(10) years two(2) months
Ten(10) years and above

three(3) months (for employees under 50 years of age).

six(6) months (for employees over 60 years)

Talk to Us to know more about the Termination of Service in Norway.

EOR Solution

Norway Employer of Record (Norway EOR) solution makes it easier and faster for businesses to expand into Norway. Taking the EOR route ensures smooth and compliant payroll processing and other employment responsibilities without any entity establishment. Skuad can help you manage monthly payroll, contracts, work permits, taxation, etc. in Norway for your employees.

1. General Employer of Record Service Terms

Taxes that apply to invoices

Norwegian entity - 7% GST

Foreign company: No GST

Minimum duration of service Three(3) months
Currency Accepted No info available
Required Details & Documents

For Norwegian Citizens: Personal information, Copy of passport, Bank details, Copy of National ID (for permanent residents), Job description.

For Expatriates: Personal information, Job description, Educational qualifications, Technical qualifications, CV, Copy of passport, Copy of ID, Bank details, Photographs, Police verification, Medical exam results.

2. Outsourcing Employment Through An Employer of Record

When, as an organization, you decide to expand into Norway, you also need to determine the route you want to take. Whether to build an in-house team or grab the services of an EOR to manage payroll and employee lifecycle beforehand.

Talk To Us to hire Employees in Norway.

Types of Visas in Norway

Visa Category Explanation
Work Permit (Skilled Labor) The following documents are the Norway work visa requirements to apply for a work permit in Norway:

1. Passport and a copy of all the filled pages of the passport.
2. A cover letter from the Application portal (or the application form) that is signed.
3. Recent passport size photos with white background, 2 in number.
4. Document suggesting that the applicant has a place to live in Norway.
5. A duly filled Norwegian Immigration Authorities (UDI) Offer of employment form.
6. Documents related to the applicant's educational background and work experience.
7. Applicant’s CV.
8. A duly filled and signed UDI’s checklist.
The application processing time can vary depending on the type of application and the channel applied through.

Intra Company Transfer If you are an employee of an international company, and you are going to carry out an assignment in a Norwegian branch, then you can apply for this visa.

Few requirements to be fulfilled to apply for this visa:

1. You must have completed the vocational training program of at least three years at the upper secondary school level.
2. You should have completed your education or a degree from a university/ university college.
3. Proof of special qualifications that you have obtained through long work experience. Your qualifications must be equivalent to those who have completed the vocational training.
The application processing times can vary depending on the type of application and the channel applied through.

Business Visa (Schengen Visa Type C)

Norway promotes free trade and is open to foreign investments, and therefore, has a business-friendly framework.

A Schengen Visa is for applicants who intend to go to Norway for business, family visits, etc., and plan to return to their country of residence afterward.

Schengen Visa is valid for a maximum of 90 days in the course of a period of 180 days. There is no provision to extend the visa after you have entered the country.

Know more about the process of visas in Norway, Talk to Skuad experts today!

Work Permit Norway

Norway’s work permits for foreigners can be taken care of by the Skuad’s local partner in the country. As an EOR in Norway, Skuad takes care of all the requirements and responsibilities related to employment. On Skuad’s HR platform, the client company can manage their employee's daily activities and operations.

Work Permits
Can Skuad Sponsor Work Permit in Norway Yes
Work Permit Validity The Work Permit in Norway is valid for two(2) years. You can get it renewed.
What’s The Cost of Work Visa 5,400 NOK or $593
Duration of Norway Work Visa Processing 8 Weeks

Talk To Us to know more about Norway’s visa and work permits and know if a Norway work permit without a job is possible.

Things You Must Know To Set Up Payroll In Norway

To set up payroll and manage taxation in Norway, you need to be aware of the rules, which vary from one category to another. The first and the foremost thing you must consider is whether you want to employ foreign professionals or locals. 

As a foreign company, you must be aware and adhere to the local tax laws like income tax, business tax, withholding tax, employee compensation insurance, social security costs, etc. There are two ways of doing it: 

a) you set up an in-house team to manage the payroll in Norway. 

b) you take the services of payroll outsourcing in Norway. The company will not only make the management simpler but also ensure complete compliance with Norway laws.

Taxation in Norway

Employer Taxation

Tax Explanation
Tax Returns Yes
Financial Year End Date 31 December
Tax Documents No info available
Corporate Tax The corporate tax gets calculated on taxable profit at 22% 27%
Withholding Tax (For Non-Residents)

Dividends: 0%- 25%
Interest: 0%
Royalties: 0%

Payroll Tax Norway employer payroll taxes get levied on employers based on the salary, wages, and benefits paid to the employees. The Norway payroll tax rate is 14.1%.
Employers Social Security and statutory contributions The contribution is based on the salary and benefits given to the employee. The contribution is levied at 14.1% and can be lower for a sparsely populated region.
Reimbursements No info available
Medical Insurance Children under the age of 16 are entitled to free medical treatment. Adults must pay a certain amount each year before they are eligible for an exemption card for free medical insurance for the lifetime.

Employee Taxation

Tax Explanation
Sales Tax VAT: 25%
Income Tax Rates

Yearly Taxable Income

*The Tax Rates are applicable for both Residents and Non- Residents.

Gross Income Tax Rate
NOK180,800- NOK 254,500 1.9%
NOK 254,5001- NOK 639,750 4.2%
NOK 639,7510- NOK 999,550 13.2%
Above NOK999,550 16.2%
Employees Social Security and statutory contributions The following conditions apply to both employed and self-employed individuals:

* If your income is less than or equal to NOK 59,650, you are exempted from the contribution.
* The contribution does not constitute more than 25% of the income over NOK 59,650.
* The income of individuals under 17 years and over 69 years of age is subject to the contribution at a 5.1% rate.

The contribution is not deductible for tax purposes.
Public Pension Under the Norwegian National Insurance Act (Folketrygdloven), Norwegian citizens are entitled to state pension from 67 years of age.

Bonuses

Some sorts of salaried employees, as well as managers and executives, receive performance-based bonuses.

Book a Demo to know more about EOR in Norway.

Incorporation: How to Set Up A Subsidiary In Norway

You must consider the following factors before establishing your operations in Norway:

1. Business Factors:

Following factors must be considered before setting up the business in Norway:

  • Business type and industry
  • Current trade relationships and agreement 
  • Nationality of the individuals and headquarters

2. Location:

Different cities in Norway have separate laws, expenditure, and availability. One must hire a legal advisor for the same. 

3. Language:

Norwegian is the majorly spoken language at 95%, while English comes a close second at 90%. 

Based on the organization size and its minimum share capital, Norway legally acknowledges the following forms of business:

  1. Private Limited Liability Company - Aksjeselskap (AS): Commonly for small and medium-sized businesses. Big companies use this entity to set up a subordinate company in Norway. Minimum two directors, mandatorily including a European/Norwegian, must be appointed with a minimum paid capital of NOK 30,000.
  2. The Norwegian Public Limited Company (ASA): The company must register at the stock market and the major decisions must be taken by shareholders at the general meeting. 
  3. Sole Proprietorship: It is incorporation where an individual is liable for the business. No separate laws regulate the sole proprietorship. 
  4. Partnership: The partnership is subject to the Partnership Act 1985. According to the Act, a partnership represents a commercial business established for the joint account of two or more partners, one of whom must have unlimited personal liability for the total obligations of the business. 
  5. Branch: A business establishment by a foreign company run by local management. It hires employees from Norway. 

Learn more about Incorporation in Norway with Skuad.

Professional Employer Organization (PEO)

A Professional Employer Organization (PEO) is an organization that shares the responsibility of managing employees and payroll with your company. Unlike EOR services where the complete responsibility of compliance management lies with the outsourced company, a PEO works jointly with your business.

Responsibilities EOR PEO
Legal employer Yes No. Legal co-employer
Services for a minimum of 1-5 employees 5-10 employees
Local business registration Not required Required
Insurance Workers Compensation provided Not provided

Skuad provides comprehensive HR services for globally managing your remote teams. Learn more by connecting with our professionals today.

Conclusion

Skuad as your EOR will help you set up a remote team in Norway and hire the employees (full-time/ contractors). We also help manage the SaaS tools while handling your company’s payroll in Norway. 

Book a Demo with Skuad to set up your remote team in Norway.

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