Protection against unfair dismissal under the Working Environment Act

An employee may not be dismissed unless the dismissal is objectively justified by circumstances relating to the undertaking, the employer, or the employee. This follows from Section 15-7 of the Norwegian Working Environment Act.

This provision is the central rule governing protection against dismissal. The requirement of objective justification is a legal standard whose content has been developed through case law. One notable development is that considerations of fairness have gained greater importance, and the courts have become more willing to scrutinize employers’ decisions.

Also applies to dismissal with altered terms of employment

The provision applies not only where an employer formally terminates an employment relationship, but also where the employer unilaterally implements changes to the employment relationship that fall outside the scope of the employer’s managerial prerogative. Such cases are often referred to as dismissals with altered terms of employment (constructive dismissals or change dismissals).

What the courts may review

When assessing whether the requirement of objective justification has been met, the courts may examine whether the dismissal is based on a correct and sufficiently comprehensive factual basis, whether the reasons relied upon are relevant, and whether the assessment has been sufficiently broad. This includes reviewing whether the employer has properly considered the fairness considerations relevant to the individual employee.

The requirement of objective justification

First, the requirement means that the dismissal must not be based on irrelevant or improper considerations. Second, the employer must have sufficiently weighty reasons to justify the dismissal. The circumstances relied upon must be serious enough to warrant termination of the employment relationship.

Third, the employer’s decision must be based on an accurate factual foundation. This is closely connected to statutory consultation requirements, one purpose of which is to ensure that the employee has an opportunity to comment on the circumstances relied upon by the employer. In this context, it is important to emphasize that the burden of proof rests with the employer. This is particularly significant where serious allegations are made against the employee.

The evidentiary requirements also imply that the employer has a strict duty to investigate the facts thoroughly when considering dismissal or summary dismissal based on serious misconduct.

Dismissal due to circumstances relating to the employee

Dismissal based on circumstances relating to the employee will normally be founded on a breach of duty or a failure to fulfil obligations under the employment contract, including conduct contrary to the duty of loyalty that exists in all employment relationships. Not every breach of the employment contract or of the employee’s obligations will justify dismissal. The threshold for dismissing an employee is high, and the employer must therefore be able to demonstrate compelling reasons.

Less intrusive measures must be considered first

As a general principle, the requirement of proportionality applies. This means that the employer must consider whether less intrusive measures, such as a warning, can be used instead of dismissal. Where dismissal is based on circumstances relating to the employee, the employer bears the risk of uncertainty and must establish the factual basis upon which the dismissal rests.

What may constitute grounds for dismissal?

A wide range of circumstances may justify dismissal. Whether a breach of duty has occurred must initially be assessed in light of the employment contract. However, the question of whether there is objective justification for dismissal requires a broader assessment in which the employee’s conduct is weighed against the interests of the undertaking. For example, inadequate job performance may constitute objective grounds for dismissal if the employee’s performance falls significantly below what the employer is reasonably entitled to expect.

The employee should be given an opportunity to improve

When assessing whether objective grounds for dismissal exist, importance will normally be attached to whether the employee has received a warning or has otherwise been informed that the employer considers there to be a breach of duty, has been encouraged to remedy the situation, and has been made aware that failure to do so may have consequences for the employment relationship. A warning is not a statutory requirement. However, particularly in cases involving poor performance, it will often be difficult to establish objective grounds for dismissal unless the employee has been given a genuine opportunity to improve.

Dismissal due to circumstances relating to the undertaking

For dismissals based on circumstances relating to the undertaking, please see our article on "Rationalisation or workforce reductions under the Working Environment Act".