Laid-off expats denied benefits

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As layoffs in the oil industry abound, many foreign workers and expatriates who’ve lost their jobs in Norway are discovering that they’re being denied unemployment benefits. They’re often forced to leave the country when faced with the loss of income, and the national union for engineers and other workers in the technology sector is crying foul.

Lots of oil industry workers are currently having to look for new work, and those who come from outside Europe often don't qualify for unemployment benefits in the meantime. Some are forced to leave the country, and the engineers' union NITO calls that a "lose-lose situation." PHOTO: Statoil

Lots of oil industry workers are currently having to look for new work, and those who come from outside Europe often don’t qualify for unemployment benefits in the meantime. Some are forced to leave the country, and the engineers’ union NITO calls that a “lose-lose situation.” PHOTO: Statoil

“This is a ‘lose-lose’ situation (as opposed to the ‘win-win situation’ cliché),” Kirsten Rydne, a lawyer for NITO (Norges Ingeniør- og Teknologorgan- isasjon), told Oslo newspaper Dagsavisen. NITO, also called The Norwegian Society of Engineers and Technologists, (external link), has around 78,000 members and has actively recruited foreign workers who came to Norway during the boom years of the offshore industry, when there was great demand for engineering and technical competence.

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Now many of those workers from outside the European Economic Area (EEA), including such sources of expertise as Australia, India and North America, are being laid off. To make matters worse, they’re discovering that they don’t qualify for unemployment benefits or assistance from Norway’s state welfare agency NAV.

The reason, according to Rydne, is because they often are not viewed as “real job seekers,” willing to take any job offered them if they’re put on furlough. In many cases, their legal residence permission in Norway is tied either to a specific area of professional expertise or to a specific employer, who had convinced Norway’s strict immigration authorities that such special talent or competence was needed and Norway’s own labour market couldn’t supply it. When such a foreign worker’s employer no longer needs them because of an economic downturn, NAV officials also turn them down for benefits on the grounds they don’t meet the conditions to be actively seeking another job. It’s also been documented that foreign workers often are among the first to be let go by Norwegian employers when times get tough.

Kirsten Rydne of NITO thinks it's wrong when laid-off workers are denied unemployment benefits because they come from outside the European Economic Area and had work permits tied to their job. PHOTO: NITO

Kirsten Rydne of NITO thinks it’s wrong when laid-off workers are denied unemployment benefits because they come from outside the European Economic Area and had work permits tied to their job. PHOTO: NITO

It’s a “lose-lose” situation, Rydne contends, “because employers lose valuable competence and the workers run into serious problems. They may suddenly have to break leases or sell off property and cars and leave the country on short notice because they simply can’t afford to stay,” unless they quickly find a new job on their own with a new employer willing to back them. The loss of a regular income, and no unemployment benefits, makes for “a critical situation,” Rydne said, that’s “deeply unfair.”

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NITO maintains it’s also unreasonable, Rydne contends, because it means that benefits are extended based on where an immigrant came from. If they moved to Norway from a country within the European Union and the EEA (formed by countries like Norway that cooperate with the EU), they qualify for benefits. If they come from Sydney or New York or New Delhi, they don’t, and are treated differently than Norwegians or Europeans.

“We believe that all employees who are laid off must have the right to receive dagpenger (the cash benefits paid out by NAV while a newly unemployed person seeks a new job),” Rydne told Dagsavisen. “Very many of our members are affected by the ongoing reductions in the workforce in the oil and oil supply industry.” Dagsavisen reported that as of August 1, the residency permits held by 7,448 immigrants were tied to a specific employer.

One of them recently complained about the situation. “I was one of the many who were laid off in Norway (because of) the low oil prices and a reduction in offshore work,” one worker from Australia wrote to recently. “I am on a skilled immigrant visa and have paid 38- to 50 percent tax to Norway for the last 10 years. I live (in Norway), have a daughter born in Norway, a house and worked for a Norwegian company. I applied to NAV for unemployment benefits … my application was rejected … the appeal was rejected too.”

Rydne noted that employers are also adversely affected by the rules. In some cases, she argues, employers feel a need to avoid laying off foreign workers (even though the job they do is no longer needed) in order to keep them and their competence in the country for when the economy improves. Seniority rules, however, can prevent that. “It’s a very difficult situation,” Rydne said.

Authorities unwilling to bend
NITO recently contacted the Labour Ministry and proposed a change in the rules, but has met resistance so far. Ellen Christiansen, director of NAV, confirmed in an email to Dagsavisen that “the requirements for being viewed as a real job seeker are strictly followed. This group (of workers coming from outside the EEA) as a rule don’t fulfill all the requirements for getting unemployment benefits.”

Officials at the Labour Ministry don’t appear inclined to order NAV to loosen up. State Secretary Kristian Dahlberg Hauge of the conservative Progress Party-controlled ministry even claimed it would be “extremely unreasonable” to apply the rules more leniently to job seekers from outside the EEA than for all others applying for benefits. Hauge said that would “poke holes” in the main rules and risk an increase in payments of unknown proportions.

“Another objection is that it would be risky to base the right to residence on access to public support when the residence is based on an agreement between two parties in the labour market,” Hauge said.

Rydne scoffed at his arguments. “We’re talking about a few thousand workers here, and not all of them will be laid off at the same time,” she said. Of the 7,468 foreigners in Norway with residence permits tied to their jobs, fully 22 percent work in the education sector, 13 percent within health care and social services, and another 13 percent within public administration and the military. Statistics from immigration agency UDI show that 12 percent secured their permits on the basis of professional, scientific or technical competence and 8 percent because of industrial ability. That would imply that around 20 percent are working within the oil and offshore sector (1,500 people) and liable for layoff.

“It is perhaps unclear how much this would cost (the welfare state), but it certainly wouldn’t be much,” Rydne added. “We view this as subject to an easy fix.” If, that is, government authorities follow through on earlier acknowledgment of the need for international expertise in Norway, and want to fix it, at a time when many Norwegians are losing their jobs as well. Berglund

  • frenk

    Surely these ‘non-EU/Norwegian’ workers were aware that they would not be entitled to welfare benefits…..? The Norwegian authorities have ‘pulled a fast one here’….you pay in…but they won’t pay out!!!!

    • Lasse Maltensson

      That’s why they should have applied to become Citizens… which they can after they have worked in Norway for 5 years.

      • Greg

        This is not true. It much harder than that and you have to give up the other citizenship (rarely worth it.)
        Also no we are not aware because we pay our taxes. The Norwegian Government is literally stealing from foreigners.

        • Lasse Maltensson

          Other than giving up ur other citizenship what else is blocking a person not from EU to get a citizenship?

        • Lasse Maltensson

          If I was from outside EU and knew this and didn’t have Citizenship, then I should try to get a Company to hire me like a hired consultant instead. Since the employeer pays higher tax on an employee than a hired consult in that way I could then ask for higher pay even though the Company pays the same sum, and save the different for a rainy day

          • Greg

            It doesn’t work life that as someone has to pay the tax somewhere along the line.
            I am not fearful of losing my job. In my experience us foreigners are in higher demand because we work harder and are more competent. If one person has to go it won’t be the foreigner. But this doesn’t save people when they get rid of everyone.

            • frenk

              Mmmmm….from what I’m hearing….how ‘competent’ you are doesn’t mean a thing….the Indians…people from the Middle East are the first to go….then Aussies and Americans….then the Europeans…..
              The Norwegians’ aren’t going anywhere….have you not noticed…this appears to be the only country in the world where businesses exist for the benefit of the Norwegian employees….certainly not the customer…they can come back when “when we are open”….!

              • Greg

                Norwegian consultants are the first to go. Everything else yes I agree and have noticed.

                • frenk

                  Christ….you’ve actually hired ‘Norwegian Consultants’……?

                  • Greg

                    All new hires are Norwegian. That is how things work.

                    • frenk

                      ..interesting….we bring new people on to our project all the time….Norwegians aren’t even considered….last 3 engineer have been English….only the secretary is Norwegian….and would ‘preferably be replaced’…if possible….

          • frenk

            Yes agree….this i what I do….and most of the people I know do…..

      • Grant Friel

        Permanent residency might be easier.

        • Thor

          A permanent residency would’ve been a lot easier, and I have a hard time not understanding why the worker from Australia had not done such — from what it seems in the article.

          • Andy AUS

            Because Australians can’t apply for it until they have lived in Norway for 5 years I think it is. That’s a hell of a lot of tax paid in those 5 years to NAV.

            • Thor

              Well, exactly. Thus it is odd that the employee in question did not get a permanent residency, knowing that there would be _some_ benefits, if not exactly which one and how they may affect him.

              • Andy AUS

                Anyway this is a non argument. Let’s forget employee in question. What about all the workers that are being laid off with no government support and have not had been granted a permanent resident permit. Also if your from the UK you don’t need a permanent resident permit. Actually I’m just explaining the article back to you. If you can’t understand the injustice here then you would be perfect for working at NAV.

                You pay huge taxes you get something back. No unemployment benefits can mean leaving the country.

      • Jen

        I am not prepared to give up my citizenship. I am patriot to my country and might want to return to my home country someday. In addition, I think my passport is more valueable than a Norwegian passport.

    • Andy AUS

      I’m an Aussie affected by the lay offs in the oil & gas industry. Definitely was not aware I would get screwed. Last 2 years I paid around 500,000 kr in tax.

      Here’s another good one. I worked with UK personnel on a vessel who were on Norwegian contracts living in the UK. They paid 38% tax to Norway. Those with kids received day care benefits. NAV has now asked for all the money paid back, in some cases over 100,000kr.

      NAV is happy to take our taxes from workers knowing full well they are not going to allow us any benefits. Staggering.

    • eMalanga

      It is always in the best interest of Norway. Let’s see how this plays out in the end. Norway depends solely on the taxes for revenue. So let’s see how this plays out in the end.

  • Lasse Maltensson

    “The reason, according to Rydne, is because they often are not viewed as “real job seekers,” willing to take any job offered them if they’re put on furlough.”
    haha and norweigians is willing:)?

    • frenk

      Hardy har har….a ‘comedy’ country…managed and governed by people who ‘don’t have a clue what they are doing’….!

  • Roham

    Only makes sense if this group of foreign workers pay less tax, i.e. Don’t pay for 8.2% social benefits tax.
    Then it would be similar to Australia, where immigrants without Permanent Residency pay less and benefit from less coverage.

    • eMalanga

      Exactly! My point too. Why make them pay the same tax like residents and in the end they are denied benefits.

  • dragonlife

    I don’t see why you need to claim benefit, if you have competence and experience. The whole world is welcoming you, why staying in the same country !!??

    • eMalanga

      Of course, but then having paid so much taxes like residents or citizens, then one should be able to get benefits anyway. If one got a job overseas even whilst still inside Norway, one would not sit and wait to be furlough and expect benefits.

  • Stuart Spitz

    You couldn’t make this up. Not content with cripplingly high taxes, punitive fees & mismanagement throughout the economy, this rip-off country now refuses to pay out welfare to people who have legitimately contributed to the system.

    It’s even more unreasonable when you consider that foreigners work harder, contribute more productivity, creativity & proactivity, and ‘take less out’ than the average Norwegian citizen.

  • In Austria and most other countries too, all foreign people who pay into unemployment insurance get benefits if they have paid for the qualifying period. It is a shame for such a rich country just to take the money from the foreign workers and to refuse them the benefits!

  • Andy AUS

    So true. My company did not care when they found out about this. My company actually used the NAV money to make them feel better about laying people off. Like it’s all good, just go on 6 months of NAV. For me it was tough sh…t..

  • SKH

    Hello everybody,

    I have a very tough situation right now regarding my work permit, unemployment benefits and residence permit. My contract will be ended as same day as my residence permit in 31/12/2015, it means I must work according to my contract until end of the year and then I have some hours to pack and leave the country!! I need a way to extend my residence permit to at least one or two months in order to collect my stuffs and preparing myself to move from the country. I worked in Norway for more than 2,5 years and in April I can apply for my permanent residence permit.
    When I asked UDI and NAV they will not give me a clear answer.
    I need a lawyer to talk about my case and may be find a solution. Does anyone know any expert lawyer with good understanding about residency and work permit for non-Eu citizen in Norway.