Written Employment Contract – Requirements, Contents, and Consequences of Lack of Documentation

The Working Environment Act requires that a written employment contract be established in every employment relationship, even though the employment relationship itself may be legally established without writing. The purpose of the requirement for written form is twofold:

1. Clarity and predictability: Ensuring that both parties have a common understanding of the terms of the employment relationship

2. Evidence security: Documenting what the parties have agreed to, in order to reduce the risk of future disputes

The requirement for written form is an implementation of EU Directive 91/533/EEC, which aims to ensure employee protection and predictability. In 2019, this was enhanced through Directive (EU) 2019/1152 on clearer and more predictable working conditions, which will lead to further changes in Norwegian law.

Legal Basis and Deadlines

The requirement for written form is laid down in the Working Environment Act §§ 14-5 and 14-6. Important deadlines:

• General rule: A written employment contract must be established no later than one month after the employment relationship began

• For short-term employment (less than one month): The agreement must be available immediately

• For employee leasing: The agreement must be available immediately

• For work abroad (more than one month): The agreement must be established before departure

The employee has the right to be assisted by a union representative or another representative, both in the preparation of the original employment contract and in subsequent changes.

Minimum Requirements for the Content of Employment Contracts

The Working Environment Act § 14-6 sets detailed minimum requirements for the content of employment contracts. The agreement must include information about all matters of "essential importance" in the employment relationship, specifically:

Basic Information

• Identity of the parties

• The workplace (or business address/home location for changing workplaces)

• Description of the work, title, position, or job category

• Time the employment relationship begins

Employment Relationship

• Expected duration and basis for temporary employment

• Provisions for probationary period, if any

Working Conditions

• Right to holiday and holiday pay, and rules for determining the holiday period

• Notice periods for both parties

• Salary, supplements, reimbursements, pension contributions, method and timing of payment

Working Hours

• Length and placement of daily and weekly working hours

• For periodic work: Establishment or calculation basis for when work should be performed

• Length of breaks

• Any special arrangements regarding working hours

Collective Conditions

• Information on any collective agreements governing the employment relationship

• If collective agreements are entered into by parties outside the company: Who the parties to the agreement are

For the points concerning holiday, notice periods, salary, and working hours, it is sufficient that the employment contract refers to relevant laws or collective agreements.

Special Requirements for Work Abroad

For work abroad (more than one month), additional requirements apply under § 14-7:

• Duration of work abroad

• The currency the payment will be made in

• Any cash and natural benefits linked to work abroad

• Any conditions for returning home

Changes in the Employment Relationship

Changes in the employment relationship must be included in the employment contract no later than one month after the change took effect, cf. § 14-8. This does not apply to changes due to changes in legislation or collective agreements.

It is important to note that § 14-8 regulates the employer's duty to inform but does not address the employer's right to unilaterally make changes. This is regulated by the rules on the employer's right of direction.

Consequences of Lack of Written Form

Lack of written form does not invalidate the employment contract but can have several important consequences:

1. Burden of Proof Rule: In case of interpretation doubts, the agreement will be interpreted against the employer

2. Heavy Burden of Proof: The employer is imposed a heavy burden of proof for alleged terms not documented in writing

3. Authority Sanctions: Inspection by the Labor Inspection Authority may result in orders and fines

In Rt. 2007 p. 129 (Cemetery worker), the Supreme Court determined that the employer had to be imposed a "heavy burden of proof" for a temporary employment contract when this was not documented in writing. There had to be "clear probability preponderance" for this to be the case.

The Employment Contract Document vs. the Content of the Employment Contract

It is important to be aware that the formal employment contract document is not necessarily decisive for what has actually been agreed between the parties. According to HR-2020-1339-A (ISS), what is considered agreed must be determined according to the principles applicable to the interpretation and supplementation of employment contracts.

Reference to Law and Collective Agreements

A particular question is the significance of references to statutory provisions or collective agreements in the employment contract:

• Collective Agreements: For parties bound by collective agreements, the reference normally does not have independent significance, as the normative effects of the collective agreement nonetheless create individual rights. For external employees, the reference usually means that the collective agreement's individual working and salary conditions become part of the employment contract.

• Statutory Provisions: According to HR-2020-1339-A (ISS), the employment contract must generally be supplemented with the statutory provisions referred to, unless there are indications that the reference was only intended as information.

Practical Recommendations for Employers

Drafting the Employment Contract

• Use clear and understandable language that both parties comprehend • Ensure that all legally required minimum requirements are met • Be precise in describing the job tasks and percentage of position • Specify clearly whether employment is permanent or temporary • In case of temporary employment: Indicate clearly the legal basis, duration, and justification

Process at Contract Signing

• Establish fixed procedures for drafting employment contracts • Inform the employee about the right to assistance from union representatives • Give the employee sufficient time to familiarize themselves with the agreement • Ensure both parties sign the agreement before commencement • Document any verbal supplementary agreements in writing

Follow-up and Updating

• Implement systems to capture changes that require updating the employment contract • Ensure changes are documented within the one-month deadline • Regularly review templates for employment contracts to ensure they are updated with current law • Upon business transfer: Carefully consider references to laws and collective agreements

Conclusion

The requirement for written form plays a central role in ensuring clarity and predictability in employment relationships. Although lack of written form does not invalidate the employment contract, it can have significant consequences in case of interpretation disputes. Employers should therefore prioritize thorough documentation of all essential matters in the employment relationship, both at establishment and at subsequent changes.