Since 2014 ESA (the EFTA Surveillance Authority), which supervises the EEA states’ compliance with EU’s Inner Market rules, has maintained that Norway’s Holiday Act 1988 is in violation of EU’s Working Time Directive (2003/88/EF).
Under the Holiday Act 1988 employees are entitled to holiday leave from the first year they are employed but not to holiday pay, as holiday pay is earned as a percentage of the previous year’s remuneration. Under Article 7 of the Directive, member states must take the measures necessary to ensure that every worker is entitled to paid annual leave of at least four weeks. ESA is of the opinion that the Norwegian rules violates this provision whereas the Norwegian government has refused to accept this.
Denmark had a holiday scheme much similar to the Norwegian Holiday Act and correspondingly received similar critical questions from the European Commission in relation to Article 7 of the Directive. As a consequence, Denmark decided to enact amendments of the Danish Holiday Act in 2020 to align their holiday act to the Directive. In spite of this, Norway kept on maintaining in its correspondence with ESA that amendments of the Norwegian Holiday Act were not necessary.
However, the Government has now turned and recently sent a letter to ESA informing that the Ministry of Labour and Inclusion wants to investigate how the earning and payment of holiday pay can be brought closer together in time.Basically, the work does not include other amendments to the system of the Holiday Act.
The work considering the necessary amendments will take place in two stages. First, model(s) for a new earnings system will be investigated through an external assignment. The ministry will then carry out a process with the parties in the working life and general consultation etc. related to possible implementation of amendments to the Act.
