Developments in Employment Law in the first half of 2026

Job security for managing directors

HR-2026-221-A

In January, we reported that the Supreme Court was to hear a case concerning the limits of an employer’s managerial authority, where a senior executive had waived job security in exchange for severance pay. The Supreme Court has now delivered its judgment and provided important clarifications regarding the courts’ scope of review in such cases.

The Supreme Court held that the courts may review whether a decision to demand departure under a severance pay agreement with the company’s chief executive constitutes an abuse of the right to manage, for example, whether the decision is arbitrary or based on extraneous considerations. If the employer has provided a reason for the resignation, the courts may also review whether the decision is based on materially incorrect facts. However, the threshold for the courts to overturn a decision on resignation is high. The Supreme Court further stated that the manager should be notified if the employer is considering invoking the severance pay agreement, but that this is a procedural rule with no legal effect on the right to implement the agreement.

Key takeaways: Although the employer has broad managerial discretion in such matters, the courts may review the decision on resignation. Employers must ensure that such decisions are made following a proper process and are based on correct facts. The senior manager should also be notified in advance.

Summary dismissal

LG-2025-150279

An employee signed a letter of resignation during a meeting with the employer following allegations of theft. Gulating Court of Appeal ruled that the resignation was invalid and, in reality, constituted an unlawful dismissal. Emphasis was placed on the fact that the meeting took place without prior notice, that the letter of termination had been drafted by the employer in advance, that the allegations were not supported by sufficient evidence, that the employee was not given the opportunity for a cooling-off period or assistance, and that the employer had not ensured a record of the proceedings, for example through minutes.

Key takeaways: The judgment illustrates that a resignation may be deemed invalid if the employer puts pressure on the employee. It highlights the importance of ensuring a proper and well-documented process.

LH-2024-29704-1

An operations manager at a bus company was dismissed on the grounds that he had put his own and his relatives’ financial interests before those of the employer. The alleged circumstances included, amongst other things, the unauthorised use of the company’s fuel card and telephone subscription whilst on holiday, the employee having employed his daughter to clean buses as a temporary assistant, and a failure to declare customs, which together resulted in the employer incurring additional costs of up to NOK 87,278. The Court of Appeal declared the dismissal invalid, both because the handling of the case was clearly unreasonable and because none of the alleged circumstances constituted a serious breach of duty. The court found that the employer had deliberately and over time worked to get rid of the employee, and that the handling of the case was solely intended to find circumstances that could be used against him. Nor was the dismissal upheld as a termination, and the employee was awarded reinstatement as well as compensation of NOK 2,560,000 for lost earnings and NOK 150,000 in damages.

Key takeaways: Even where there are several reprehensible acts on the part of the employee, dismissal may be declared invalid if the employer’s handling of the case is unreasonable and characterised by bias. Employers who

LH-2025-142017

In January, we reported on the Supreme Court’s decision HR-2025-1687-A, which clarified that an employer has no duty to redeploy an employee upon dismissal. The case has now been reheard by the Court of Appeal, which unanimously concluded that the dismissal was lawful.

The case concerned a nurse who was dismissed after hitting a intellectually disabled patient/service user during an episode of agitation. The Supreme Court overturned the previous Court of Appeal judgment which had upheld the dismissal, and ruled that there is no duty to redeploy upon dismissal. In a new hearing before the Court of Appeal, the dismissal was unanimously deemed lawful – the blow constituted a gross breach of duty, and considerations of user protection and the heightened duty of care incumbent on healthcare staff made the dismissal proportionate.

Key takeaways: The Court of Appeal confirms that one-off incidents, such as a single act of violence, can justify dismissal – without any obligation to consider redeployment. Repeated misconduct or prior warnings are not required if the act is sufficiently serious. The judgment emphasises that particularly strict requirements are imposed on staff providing care for people with intellectual disabilities and other vulnerable groups.

Resignation and the right to remain in post during the notice period

25-191928ASK-BORG/04

A head of department at a shipbroking firm was dismissed after sharing an inappropriate image via an internal WhatsApp group, which spread within the shipping community. The employer considered it unreasonable for the employment relationship to continue whilst the case was being heard and demanded that the employee resigned from the position.

Borgarting Court of Appeal, like the District Court, found that there were no grounds for resignation and that the employee was entitled to remain in the post during the notice period. The adverse effects, including on the working environment, of the employee remaining in the post were not sufficiently documented, and the outcome of the dismissal case was uncertain.

It has since been reported in the media that the underlying dispute regarding the validity of the dismissal was resolved through an out-of-court settlement.

Key takeaways: The general rule is that an employee has the right to remain in his/her post during the notice period. The employer must document specific adverse effects in order to succeed with a demand for resignation, even in cases where the employee’s conduct is reprehensible.

Non-competition clauses for shareholders who are employees

LA-2026-7531

The case concerned an application for an interim injunction to enforce a non-competition clause in a shareholders’ agreement. A minority shareholder, who was also employed by a subsidiary, took up a position with a competitor in breach of a non-competition clause in the shareholders’ agreement. The question was whether the non-competition clause in the shareholders’ agreement was, in reality, a restriction directed at the minority shareholder as an employee, and thus in breach of statutory rules limiting non-competition clauses for employees.

The Court of Appeal granted the application for an interim injunction. The Court of Appeal concluded that the connection to the share purchase and the minority shareholder’s role as a reinvesting shareholder meant that the mandatory provisions of the Working Environment Act regarding non-competition agreements in employment relationships did not apply. The court considered that there could be entirely legitimate reasons for the agreement to have been entered into with the parent company, given that the shareholders are situated at this level in the corporate structure, although the court acknowledged that this could provide an opportunity to circumvent the provisions of the Working Environment Act intended to protect the employee.

Key takeaways: This case differs somewhat from other similar cases in recent years, and in our view it is uncertain whether the Court of Appeal’s assessment reflects current law. The decision illustrates that the courts make a specific assessment of whether a non-competition clause has a sufficient factual connection to the employment relationship for Chapter 14A of the Working Environment Act to apply, or whether the clause is in reality rooted in the shareholder relationship and is therefore governed by general freedom of contract.

TOSL-2026-33148

DNB did not succeed in its application for an interim injunction against a former key employee at Carnegie who had signed non-compete clauses both in a transaction declaration (as an indirect shareholder) and in the employment contract. The court ruled that the transaction declaration was in fact an employment contract subject to Chapter 14A of the Working Environment Act, because the employee’s competition-relevant knowledge stemmed from the employment relationship – not from a marginal shareholding. The employee was therefore bound by the non-competition clause for one year – not two years as stipulated in the transaction declaration. The one-year period was calculated from the date the employee was barred from the workplace, not from the expiry of the formal notice period, as the court found that the employment relationship effectively ceased upon the barring.

The decision has been appealed to the Court of Appeal and is therefore not yet final.

Key takeaways: Non-competition clauses in transaction documents may be subject to the mandatory provisions of the Working Environment Act if the clause has a sufficient connection to the employment relationship. The ruling illustrates the courts’ clear emphasis on labour market mobility.

Employers who exclude employees during the notice period risk the employment relationship being deemed to have effectively terminated at the time of exclusion, meaning that the binding period for the non-competition restrictions begins to run from the date of exclusion.

Personal liability for damages under the Limited Liability Companies Act in employment relationships

The courts are dealing with an increasing number of cases where employees and shareholders bring claims for damages directly against the company’s officers – typically the managing director or board members – instead of, or in addition to, the company itself. Three recent decisions illustrate this trend and the legal challenges it raises.

In LG-2025-102682 – a shareholder dispute between two equal owners (50/50) – the Court of Appeal acquitted the chairperson on the whole. On one point, however, the court found negligence: the chairperson had taken a decision to dismiss the managing director in breach of both the Limited Liability Companies Act and the Working Environment Act. Liability for damages was nevertheless not imposed, as the dismissal was never carried out and there was therefore no financial loss. In TOSLO-2025-96498, the District Court found that the managing director/chairman had intentionally caused the employee loss through wrongful dismissal, and was held jointly and severally liable with the company for the financial loss (lost sick pay and holiday pay). The compensation for non-economic loss of NOK 100,000, however, was imposed solely on the company – a distinction which, in our view, is correct, as Section 17-1 of the Limited Liability Companies Act does not provide for compensation for non-financial loss. In TOSLO-2025-7383, the District Court found that the conditions for personal liability under Section 17-1 were met in respect of unpaid wages and sick pay, but did not uphold the claim for compensation for lost earnings or compensation for non-economic loss.

TOSLO-2025-7383 deserves particular attention regarding the distinction between the company’s liability and the director’s personal liability. In the judgment, Oslo District Court states that "the defendant must be identified with the employer". The defendant was, admittedly, the sole owner, chair of the board and managing director – and thus exercised the actual control of the employer’s functions – but the statement illustrates a tendency in lower court practice not to draw a sufficiently clear distinction between the employer company as a legal entity and the individual representative as an independent tortfeasor. The company’s officers do not normally have personal employer liability; it is the company that is the employer. When the district court equates the officer with the employer, there is a risk that the question of whether the individual has acted negligently in a manner giving rise to liability for damages will be confused with the question of whether the company, as employer, has acted unlawfully. In our view, this conflation of liable parties is problematic and may result in the standard of care being set lower in practice than that prescribed by Section 17-1.

Key takeaways: Managing directors and board members may be held personally liable for damages under Section 17-1 of the Companies Act in the event of wrongful termination of employment. However, the courts must keep the assessment of the individual’s negligence separate from the assessment of the employer company’s liability – a distinction that is not always observed in lower court practice. Companies should ensure that persons handling dismissal and termination processes have sufficient competence to carry these out in accordance with the law, and where necessary, the employer should engage external assistance. It should also be considered whether the company has directors’ and officers’ liability insurance covering the potential liability of officers towards third parties, including employees.

Overtime pay for part-time employees

TSOS-2025-121698 (Coop øst) and thoo-2025-182601 (innlandet hospital)

In two cases, the District Court has considered the question of whether a part-time employee is entitled to overtime pay for work exceeding the agreed percentage of full-time employment, but within the framework of normal working hours (overtime). In both cases, the District Court concluded that the Norwegian model, with a common threshold for overtime pay for full-time and part-time employees, constitutes unlawful discrimination against part-time employees. Both decisions are based on the prohibition against discrimination against part-time employees in Section 13-1(3) of the Working Environment Act and the EU Part-Time Work Directive 97/81/EC, which requires the state to implement a prohibition against treating part-time employees less favourably than comparable full-time employees solely because they are part-time employees. In practice, the judgments mean that the threshold for overtime pay must be adjusted proportionally for part-time employees, in line with the principle of proportionality set out in the Directive. Both judgments were delivered with a dissenting opinion (2–1).

In both cases, the District Court rejected the argument that the desire to foster a full-time culture constituted sufficient objective justification for the differential treatment. The distinction between voluntary and mandatory overtime was not given decisive weight. Furthermore, the court concluded in both cases that the claims for back pay cannot be limited in time to the period following the European Court of Justice’s Dialysis ruling (delivered on 29 July 2024) , but are limited only by the general three-year limitation period under the Limitation Act.

Both district court judgments have been appealed and are therefore not final. The legal situation must consequently be regarded as unresolved. The Government has set up a tripartite working group comprising representatives from employer and employee organisations to assess the consequences of the European Court of Justice’s rulings in C-660/20 (Lufthansa) and the joined cases C-184/22 and C-185/22 (Dialysis). However, the working group’s deliberations have been characterised by entrenched positions. The group is now to proceed on the basis that the Norwegian rules on compensation for overtime must be amended, and to propose regulatory changes that prevent discrimination between part-time and full-time employees regarding payment for overtime and extra work. The proposals are to be submitted by 1 September 2026. Early indications suggest that the group will not reach agreement on proposals for new rules.

Key takeaways: Employers who make extensive use of part-time staff and overtime should already be reviewing their own practices regarding overtime pay and assessing the financial exposure in the event of a change in the law. If the legal position is confirmed by higher courts or the legislature, this could trigger extensive back-pay claims and necessitate changes to collective agreements, pay systems and employment contracts.

Calculation of average working hours

LF-2025-203370

Frostating Court of Appeal upheld an employee’s claim for wages following the termination of employment with a staffing agency. The case concerned a carpenter employed in an 80% position at a staffing agency, who had worked more than the percentage of the position during an assignment period and had subsequently not been given any new assignments. The wage claim related to the period during which he was without assignments.

A key issue in the case was whether a valid agreement had been entered into regarding the averaging of working hours, cf. Section 10-5(1) of the Working Environment Act. The point of dispute was whether the working hours were "arranged" in accordance with Section 10-5(1) of the Working Environment Act. The employee’s employment contract specified that the work could be carried out periodically, and that working hours, breaks and time off were to be set out in the individual assignment confirmations. The Court of Appeal concluded that the employment contract’s reference to the assignment confirmations was not sufficient to satisfy the requirement for an arrangement. There must be a plan that enables the employee to calculate when weeks with longer and shorter working hours fall within the calculation period. Without a valid arrangement, the employee was entitled to 80% of his salary during the period in which he had no assignments.

Key takeaways: The requirement for a working time arrangement must be viewed in conjunction with the requirement in the employment contract for a plan for working and rest periods. The judgment concerns a specific and particular set of facts, but the legal reasoning regarding the question of whether the working hours were "arranged" is formulated in general terms. It is therefore unclear what significance the judgment has for more general situations relating to the calculation of averages and any requirement for a plan ensuring that such employees know in advance when they will be working long or short hours.

Temporary employment for project-based assignments

LB-2025-10326

The case concerned a post-production supervisor who had been continuously employed on a temporary basis for almost three years on various projects within a company, and who was seeking permanent employment. The majority of the Court of Appeal concluded that the employment was lawful under Section 14-9(2)(a) of the Working Environment Act, because the work was linked to specific, time-limited projects and there were no employment opportunities available upon the expiry of the last contract. The minority dissented, pointing to the lengthy period of employment and the employer’s failure to consider alternatives such as part-time work, time off in lieu or the averaging of working hours.

Key takeaways: Project-based work may provide grounds for temporary employment even in the case of longer continuous engagements, but the duration of the employment heightens the requirements regarding the employer’s justification and assessment of alternative solutions.

Broadened definition of occupational accidents and clarification of the burden of proof

In Prop. 93 L (2025-2026), the Ministry of Labour and Inclusion proposes amendments to the occupational injury provisions of the National Insurance Act. The core of the proposal is to broaden the definition of an occupational accident by removing the requirements that the incident must be "unexpected" and that the strain must be "unusual" compared with what is normal in the work. The assessment is to be linked to a greater extent to the risk associated with the work or the workplace.

The proposal could give more workers the right to occupational injury cover, including where the injury occurs during realistic training or during ordinary work involving particular risks. The bill also clarifies the reversed burden of proof in cases of occupational diseases.

Status: The bill was presented on 7 May 2026 and is currently being considered by the Labour and Social Affairs Committee of the Norwegian Parliament. A hearing is scheduled for 21 May, and the committee has until 5 June to submit its recommendation. The provisional date for the first reading in the Norwegian Parliament is 12 June 2026. Based on previous decisions by the Norwegian Parliament, we expect the proposal to receive majority support.

Report on the regulatory framework for Independent consultants and advisers

A multi-stakeholder working group, appointed by the Ministry of Labour and Inclusion, submitted a report on forms of engagement for independent consultants and advisers on 27 March 2026. The working group as a whole recommended that the Ministry draw up guidelines specifying when there might be grounds for entering into independent assignments in the consultancy and advisory sector. Some members of the working group also recommended a narrow special rule for the hiring of independent consultants with their own limited companies and specialist expertise for clearly defined projects.

Status of the EU Pay Transparency Directive

In January, we discussed the EU Pay Transparency Directive, which the EU adopted in 2023 and which is considered EEA-relevant. Since January, no proposals for Norwegian implementation have been put forward, but the deadline for EU Member States is approaching. EU Member States have until 7 June 2026 to transpose the EU Equal Pay Directive (Directive 2023/970) into national law.

The EU Pay Transparency Directive aims to enhance transparency regarding pay and contribute to equal pay for work of equal value between the sexes. As of May 2026, the Directive has not been incorporated into the EEA Agreement, and consequently no implementation deadline has been set for Norway. The Ministry of Culture and Equality is nevertheless preparing for its implementation into Norwegian law, but neither a consultation paper nor a draft bill has been presented. The Directive includes, among other things, a requirement to disclose pay in job advertisements, a ban on asking about previous pay, and a reporting obligation regarding pay gaps in larger organisations. Although the Directive has not yet been implemented, Norwegian employers already have obligations under Section 26 of the Equality and Anti-Discrimination Act (the duty to take action and report), which partly overlap with the Directive’s requirements.

The application of the Temporary Agency Work Directive to the Norwegian continental shelf

Case e-6/25 - the saga subsea case

On 13 April 2026, it was decided that the Saga Subsea case would be heard by the Grand Chamber of the Supreme Court. The central question is whether the EU Temporary Agency Work Directive (2008/104/EC) applies to temporary work agencies on the Norwegian continental shelf, and whether temporary workers there are entitled to equal treatment with the user undertaking’s own employees. In an advisory opinion in February 2026, the EFTA Court held that the EEA Agreement applies to the continental shelf. This conflicts with the position Norway has taken for many years. The State has indicated that it will argue that the Supreme Court should depart from the EFTA Court’s interpretation.

Key takeaways: The case could determine the scope of EEA law on the Norwegian continental shelf, with potential consequences far beyond the field of labour law. If the Supreme Court follows the EFTA Court’s line, this could open the door to extensive back-pay claims for hired offshore workers. Employers and staffing agencies operating on the continental shelf should therefore follow developments closely.

Read more about the case on our website.

Forms of employment and classification of platform workers

LB-2025-94406 - The wolt case

Borgarting Court of Appeal ruled, by a majority of 4 to 1, that three delivery couriers at Wolt Norway AS, represented by Thommessen, were not employees under Section 1-8 of the Working Environment Act. The majority placed decisive weight on the couriers’ actual autonomy, including the fact that they were free to log on whenever and however often they wished, could decline job offers without consequences, provided their own equipment and were responsible for their own earnings. Although Wolt exercised a certain degree of control through the app and algorithms, this was no more intrusive than is normal in a contract relationship. Particular emphasis was placed on the fact that the allocation algorithm did not take into account the couriers’ performance or subjective assessments. On this basis, the majority concluded that the couriers’ actual freedom and independence meant that there was no such imbalance of power as to require the protection afforded by classification as employees. The conclusion was therefore that they had been correctly classified as contractors.

Fellesforbundet appealed the judgment to the Supreme Court. On 12 May, the Supreme Court’s Appeals Committee decided to allow the appeal regarding the application of the law relating to the classification issue under the Working Environment Act and the Annual Leave Act. The case is therefore not yet finally decided.

Key takeaways: The judgment provides important guidance on the distinction between employees and contractors in platform work. The judgment emphasises that, when assessing employee status, it is particularly crucial how much freedom the worker has in relation to the client’s management and control. If the contractor has genuine freedom to decide when they wish to work, which assignments they accept and can refuse without negative consequences, this strongly suggests a contractual relationship – even where there is some degree of algorithmic control and limited scope for negotiation. The Supreme Court’s consideration of the case could set a precedent for the classification of platform workers in Norway.

Case concerning "a position of particular independence"

LG-2025-4886

In September 2026, the Supreme Court will, for the first time, consider the meaning of the phrase "particularly independent position" under section 10-12, second paragraph, of the Working Environment Act. The case concerns a project manager at a construction company who claimed overtime pay after the company went bankrupt, directing the claim for compensation personally against the chair of the board and the managing director. The employment contract stipulated that overtime was included in the salary, but did not expressly classify the position as "particularly independent". Gulating Court of Appeal concluded that the project manager held a particularly independent position and was therefore not entitled to overtime pay. The court emphasised that he managed large construction projects with considerable autonomy, controlled his own working hours and prioritised tasks without interference from management.

Key takeaways: The Supreme Court’s decision will provide a principled clarification of the scope of the exemption for "particularly independent positions", a provision of great practical significance for a considerable number of employees. The outcome could have direct consequences for the classification of a range of job types, and for the drafting of employment contracts more generally. A strict interpretation could narrow the scope of the exemption and open the door to claims for back pay from employees who believe they have been misclassified, as well as result in increased wage costs for employers.

Public holiday during the extra holiday week for employees over 60

LG-2025-64156

The Appeals Committee of the Supreme Court has decided that the appeal by Time Municipality and the Norwegian Association of Local and Regional Authorities (KS) against the judgment of Gulating Court of Appeal of 5 February 2026 (LG-2025-64156) shall be heard by the Supreme Court. The case concerned the provisions of the Holidays Act regarding extra holiday for employees over the age of 60, where a shift-working nurse demanded to take her extra holiday during a week that included Boxing Day. The employer refused this and required her to report for work. Both the District Court and the Court of Appeal ruled in favour of the employee and held that the working day principle applies equally to all leave – when additional leave is taken as a continuous period, it is extended to include public holidays falling within that period.

Key takeaways: The Supreme Court’s consideration will provide a principled clarification on the scope of the working day principle for additional holiday entitlement. The outcome will have significant practical implications for employers with shift patterns, where taking additional holiday around public holidays can create staffing challenges.

Basic amount changed from 1 May 2026

The basic amount in the National Insurance Scheme is NOK 136,549 from 1 May 2026. The basic amount is used to calculate and adjust various social benefits, such as pension contributions, work assessment allowance (AAP), disability benefit and sickness benefit. The basic amount is adjusted annually.