1. Dealing with Low Wage
Labour Migration: Norway
Line Eldring, Fafo Institute for Labour and Social Research,
Friedrich-Ebert-Stiftung & Arena Idé Conference,
Stockholm, 14.11.2014

2. The Norwegian debate in 2004
 What will be the scale of migration from the East?
 will migrants rather go to other destinations?
 what about «welfare tourism»?
 Transitional restrictions ‘just in case’
 but free flow of services
 Risk of social dumping? Or rather social jumping?

3. THE ANSWER: Stock of citizens from EU8+2 in Norway,
2004 and 2014
Source: Statistics Norway
+ numerous posted workers, non-settled workers and service providers

4. Stock of citizens from EU8+2 in the Nordic countries,
2003 and 2014*
*Numbers for Iceland are from 2006 and 2013 Source: Nordic Statistics 2014
+ numerous posted workers, non-settled workers and service providers

5. Erga omnes
Measures
ILO 94
Construction
workersA
Lack of labour
Welfare
benefitsA
Transitional
rules
Financial
crisis
Poles
LavalA
Roma
TU responses
Housing
IntegrationA
PostingA
Mobility of
services
EU
regulations
Undeclared
work
Labour hire
Free flow
TWA
Language
Low wage
competition
Skills
Extension of
CAs
Recruitment
strategies
Living
conditions
Action plans
Social
dumping
Labour
InspectorateA
Minimum
wage
Labour
market crime

6. Who is threatened?
 Does labour migration pose a
threat to the “Nordic model”?
 Or does the model fail in
securing labour migrants a
decent working life?

7. Nordic minimum wage regulations
Coverage of
collective
agreements in
private sector
Statutory
extension of
collective
agreements
Type of
regime
Denmark 74 % No Autonomous
collective
agreement
model
Sweden 85 % No
Norway 50 % Yes, some Mixed model
Finland 85 %
Yes, widespread
Regulations
by law (and
strong unions)
Iceland 95 % Yes, widespread
Source: Alsos & Eldring (2008/14)

8. The Norwegian government’s action plans
against social dumping
Action plan 1 (2006):
Strengthening the sanctions at the disposal of the Labour Inspection Authority
Increased resources for controls and supervision
Ensuring more orderly conditions in connection with the hiring and hiring out of employees
Improving the system for the general application of collective agreements
Combat unscrupulous contractors and in the establishment of sole proprietorships
Include requirements for Norwegian pay and working conditions in municipal tender procedures (ILO 94)
Introduce extended responsibility for clients and ID cards in the building industry
Implement measures in coastal shipping and agriculture
Improve statistics and the basis for analysis
Improve coordination of the efforts of government agencies throughout the country
Strengthen cooperation between the authorities and the social partners
Action plan 2 (2008):
Increased resources to the Labour Inspection Authority
Improving the system for the general application of collective agreements
Joint and several liability
ID cards in the cleaning sector
Establish a regional safety representative scheme in the hotel & restaurant and cleaning sector
Industrial Injury Insurance – improve information on right and duties
Information and advice – give sufficient information to foreign employees and employers
Measures against social dumping in the agricultural sector – more information, supervision and control
2014: The government is preparing a strategy against
labour market crime

9. Evaluation of the action plans (Fafo)
 Regulations and enforcement was strengthened
 The measures against social dumping had a
positive effect
 High probability of more social dumping without the
measures
But:
 This is the situation in areas with extended
collective agreements – where both regulations
and controls are strenghtened – but to a far less
degree in sectors without legally extended
agreements

10. Legal extension of collective agreements in
Norway: A novelty
 The Act Related to General Application of Wage
Agreements came into force 1. January 1994, but was not in
use until 2003/4
 The purpose of the act is to protect foreign workers and to
ensure fair competition for companies (not to ensure a
widespread diffusion of collective agreements in the labour
market)
 Only wages and individual working conditions can be
extended
 Extended agreements as of today:
 Construction
 Ship-building
 Agriculture
 Cleaning
 Applications for extensions of collective agreements fish industry,
electricians, transport are currently processed.

11. Legal extension of collective agreements:
Experiences & effects
 Employers:
 Positive in construction and cleaning
 Strong opposition in ship-building
 Trade unions:
 So far no free rider problems
 Tool for recruitment of migrant workers
 Current extension system needs revision
 Migrant workers’ wages:
 Positive effects – but still evidence of wage dumping
 Average wages lower than among native workers
Source: Eldring et al. (2011)

12. Low wage: Share of Polish construction workers in
Oslo with wages below the extended minimum rate
(2010)
Permanently employed in Norwegian
company
0 %
Temporary employed in Norwegian
company
23 %
Employed by temporary work agency
6 %
Employed by foreign sub-contractor
38 %
Total
19 %
Self-employed 34 %
Source: Friberg & Eldring (2011)

13. Dealing with low wage in Norway:
Summary remarks
 «Everybody» is against social dumping – but it is still disputed
where the borderline between acceptable and unacceptable
conditions is
 Collectively agreed minimum wage rates accepted (by trade
unions, government, some employers’ association) as benchmark for
dumping/non-dumping
 Extension of collective agreements; most important tool
 But only applied in four sectors so far
 Average (native) wages far above minimum rates in most
sectors
 Some employers’ associations and political parties want to
replace the extension mechanism with statutory minimum
wage – this is strongly opposed by the trade unions

14. «We thought we were going to
the civilized Europe...»
«We don’t think we ever will
become proper members of
the Norwegian society.»
Latvian construction workers
in Norway, 2013

15. www.fafo.no/Oestforum