In today’s globalized world, companies often need to send their employees abroad to carry out projects, gain new knowledge, or offer them a broader professional perspective. This is a core part of what’s known as Global Mobility, which involves the strategic movement of talent across borders.
To ensure a successful assignment, employers must plan employee relocation efficiently and proactively regardless of where in the world it takes place. Thorough preparation is essential, particularly when sending employees to countries with complex legal and administrative frameworks. Since each country has its own rules regarding immigration, residence permits, employment terms, tax obligations and more, employers are responsible for ensuring full compliance with local regulations. Failure to comply can lead to serious consequences, such as delays, fines, project shutdowns, reputational damage, or, in severe cases, even imprisonment. In this blog, we’ll walk you through the key compliance requirements employers must know when relocating employees to Norway.
Norway has currently visa-free agreements with 191 countries, allowing citizens of these countries to enter Norway and stay for 90 days (usually within a 180-day period) without needing to apply for a visa. It is important to note that this will not give an automatic right to a work permit:
Also read: Is a residence permit necessary when working in Norway?
In Norway, there is a requirement for electricians dealing with electrical installations, as well as the site supervisor. They need pre-approval from the Norwegian DSB registry, and their employer must be listed in the Norwegian Electricity Business Registry (El-virksomhetsregisteret).
The process requires documentation and takes approximately 4 months before approvals are in place. We recommend that you prepare this prior to your employees coming to Norway as this will also be a pre-requirement when applying for work permits.
Also read: Registration and approval guide for foreign electrical workers
Norway has strict employment laws, and a key aspect is what must be included in employment contracts. Everything related to the work assignment, including salary, working hours and overtime, holiday pay and leave, termination rules and more, must be clearly stated. The employment contract must reflect the terms that are more favorable to the employee—whether they come from the employee’s home country or Norwegian regulations.
Also read: Key considerations for drafting Norwegian employment contracts
Norway do not have a nationwide minimum wage requirement. However, minimum wage rates are set through collective agreements for specific industries and sectors.
Also read: Minimum wage rates in Norway
When moving your employees to Norway, you might face tax and reporting requirements for both your company and your employees. The main rule is that business and work activity must be reported and taxed from day one. One frequent concern that occurs in this matter, is if/when a permanent establishment of your company occurs in Norway. This may lead to double taxation for you and your employees.
However, Norway has entered into tax treaties with over 80 countries, allowing both employers and employees to avoid double taxation― and in some cases, even qualify for tax exemptions in Norway depending on the nature and duration of the activity taking place.
It is important to be aware that even if Norway does not have the right to tax income based on a tax treaty, you, as the employer, will in most cases still have reporting obligations.
Also read: Employee tax in Norway
Foreign employees and employers conducting business in Norway are in principle required to pay National Insurance (NI) to Norway―unless they are covered by a valid Certificate of Coverage from their home country under a totalization agreement. In these cases, Norwegian employer NI contribution (14.1%) and employee contribution (7.7%) can be avoided.
However, if employees are subject to Norwegian NI, the employer is also required to establish an occupational pension scheme, with a minimum of 2% of salary, subject to certain conditions. In addition, work injury insurance is mandatory for all employees.
Clarification of NI membership is crucial not only from a cost perspective, but also in cases where accidents happen and an employee may need medical treatment. Not having employee NI membership clarified, can in worst cases have a severe impact in the offer of treatment which the employee is entitled to due to an injury or illness in Norway.
Also read: What is the Norwegian National Insurance Scheme?
When sending employees to work in Norway, employers need to investigate whether a work permit is required, if the professions in question require a specific pre-approval, and if the existing employment agreements meet the Norwegian standards. Employers should also investigate what reporting and tax implications there will be for the employees and the employer company to be prepared for any extra tax costs and cashflow planning. It is also important that employees, with the assistance of the employer, clarify the National Insurance membership with the employee home country authorities to avoid extra costs and lack of medical treatment in cases of injuries or illnesses.
The above illustrates the complexity involved in relocating employees to Norway, making thorough planning essential. We recommend beginning the investigation, planning, and coordination process several months in advance of any employee assignment in Norway. Proper preparation will help you avoid unnecessary costs, delays, and penalties.
Magnus Legal specializes in advising foreign businesses on their activities in Norway. If you have questions about compliance, feel free to reach out for guidance on how best to navigate.