In several cases, news has reported serious violations of the Working Environment Act at Norwegian shipyards. Now news can reveal that even if the Norwegian Labor Inspection Authority wanted to impose a fee greater than the gain from the offenses, it was impossible. In that case, the Norwegian Labor Inspection Authority would have broken the law itself. How is it related? It all starts with an inspection in 2019, at Kleven Verft in Møre og Romsdal. Here, the Lithuanian company Staff 365 was under scrutiny. After a random sample that gives rise to suspicion, the Norwegian Labor Inspection Authority hits the big drum. As many as 306 workers from the company are checked. The yard’s port log is used to find out how much the workers have actually worked. Violations of the Working Environment Act abound. Several of the breaches are particularly long: An employee worked 41 full days in a row – without one day off. Another worked more or less continuously for 36 hours. The audit also checks the salary. The conclusion is that the workers have only received 60 percent of the minimum wage. The employer, Staff 365, claims in a complaint that they have misunderstood the rules. They also believe that the offenses are not systematic. The Norwegian Labor Inspection Authority disagrees. Their final conclusion from December 2020 states “extremely serious breaches in this case, and with great potential for harm to society.” Attorney Sandra Latotinaite represented Staff 365 in the supervisory case. She refers to the company, since the assignment has ended. Staff 365 has not responded to news’s inquiries. How big should the fee be? The Norwegian Labor Inspection Authority decided to give Staff 365 a so-called infringement fee. The audit has had the opportunity to do so since 2014, when the Working Environment Act was amended. As a starting point, the fee shall “exceed the gain obtained” in the event of an offense. It was stated in the bill from the Ministry of Labor, which the Storting passed. The Ministry also wrote: “In order for the violation fee to have a sufficient preventive effect, it is important that the breach of regulations does not appear to be profitable for the violator.” For Staff 365, the breaks were still profitable. Even after fee. The Norwegian Labor Inspection Authority’s problem Shipyards are an industry with a minimum wage. Thus, it is possible to calculate what the company saved on the underpayment. The Norwegian Labor Inspection Authority’s calculation for one month showed the following: Staff 365 should have paid the workers a total of NOK 8.1 million in wages. The company paid only NOK 4.9 million. By underpaying the workers, the company saved 3.2 million. Arbeidstilsynet concluded that the fee should “have been measured at a sum well over NOK 3,500,000”. Then the fee would be greater than the gain. It was just a problem. “However, this is above the maximum limit of the law.” The Working Environment Act has a limit on how large a fee can be. It is 15 times the National Insurance basic amount. This corresponds to a fee of NOK 1.65 million – and applies regardless of the gain in the event of an offense. Will remove the limit Fellesforbundet reacts to the fee limit. – The level is far too low. If you’re a big villain, this is not a deterrent. The example shows that you can make a profit by utilizing the system well enough, says union leader Jørn Eggum. He is disappointed with another example of illegal working conditions at a Norwegian shipyard. Jørn Eggum is the leader of Fellesforbundet, which organizes workers at Norwegian shipyards. Photo: Patrick da Silva Sæther / Patrick da Silva Sæther Eggum believes the law should not have an upper fee limit. – There should be no roof. The fee should be set after the offenses. It must sting. The Storting and the government have a job to do here, he says. Although the Norwegian Labor Inspection Authority would give Staff 365 a higher fee, they have not advocated raising the upper limit of the law. – It can of course be discussed whether the size of the fees we can give are large enough. We believe that the level as a starting point is sufficient in the vast majority of cases. This is what section chief Jens Erik Romslo in the Norwegian Labor Inspection Authority says. Jens Erik Romslo is section chief in the Norwegian Labor Inspection Authority. Photo: Dag Harald Kvammen Andersen / news – If you save 3.2 million kroner on offenses, and then get a fine of a maximum of 1.65 million – would you say that it stings? – In the vast majority of cases, our room for maneuver is sufficient. But we make no secret of the fact that in a few cases the ceiling may be too low. – When will it be? – It will typically be for large companies with solid finances that have potentially achieved large gains or savings in the event of serious breaches of the regulations. Romslo adds that the audit can also issue orders, coercive fines and decide to stop the work. – If you look at the whole in this, it stings. Regarding the fee against Staff 365, Romslo says – In this case, we considered that the fee was sufficient when the decision was made. The case is admittedly somewhat back in time. The Norwegian Labor Inspection Authority has lately worked hard to determine the correct fee level. Romslo emphasizes that the audit continuously assesses the need for changes in the regulations. – A paradox Labor law lawyer Mari Verling questions whether the preventive effect of the current fee ceiling is sufficient. Labor law lawyer Mari Verling from Kvale law firm. Photo: Kvale law firm – It appears as a paradox that the law does not allow for the collection of the entire amount someone has saved by breaking the law, she says. However, Verling believes that the law should have an upper limit. – It would be worrying if the audit could impose as large a fee as they want, without going the way of the police and court. It is about the rule of law, she says. Verling adds: – The Norwegian Labor Inspection Authority should probably consider reporting such serious cases to the police more often, she says. Arbeidstilsynet informs news that so far this year they have reported five companies. Was expelled from the shipyard Olav Nakken was director at Kleven Verft when the Norwegian Labor Inspection Authority stepped up. He believes the yard had a strong focus on preventing social dumping through contracts and random sampling. – Despite this, the yard was not able to detect the pointed out deviations so far down the supply chain, he says. Olav Nakken was director at Kleven Verft when the Norwegian Labor Inspection Authority stepped up. Photo: Arne Flatin / news There were three contract terms between the yard and Staff 365. – It is very demanding to uncover such matters. Sometimes assistance from the authorities is needed. They have an expanded policy apparatus, says Nakken. The yard did not use the port log to check working hours. This is for privacy reasons. The log should show who was at work in the event of accidents, Nakken states. When the Norwegian Labor Inspection Authority’s report on Staff 365 was ready, Kjetil Bollestad had taken over as director at Kleven Verft. He says that Staff 365 was expelled when the offenses became known. In 2020, the yard was acquired by Green Yard. Chairman Hans Jørgen Fedog tells news that Staff 365 has not worked at Green Yard Kleven.
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Arbeidstilsynet wanted to give companies millions in fees – but the law forbids it – news Dokumentar
