Newsletter: February 23, 2024

Welcome to the latest edition of our newsletter! Our goal is to ensure that you are well informed and equipped with the latest information.

Read on to stay ahead, stay compliant, and set the course for success.

New Norwegian Staffing Agency Requirements

The authorisation process for staffing agencies to function in Norway has been revised, with effect from January 1, 2024. The new regulations mandate that all staffing agencies, regardless of size and including those already registered and operational in the country, must obtain authorisation from the Labour Inspection Authority (Arbeidstilsynet) to operate legally in Norway.

While the application for a license as an official staffing agency can be completed online, multiple requirements need to be met before applying.

• The staffing agency must be registered in Norway as a limited or public limited company or provide an insurance or bank guarantee equivalent to the minimum share capital.
• Staffing agencies based in another EEA country require a representative in Norway if the agency does not have a local establishment.
• The reporting obligations include providing company details, representative information, and documentation proving compliance with the Labour Inspection Authority.
• The Labour Inspection Authority will maintain a public register of compliant staffing agencies.
• Registered agencies will need to confirm compliance and registration annually by January 31 each year. Non-compliance could lead to removal from the register.
• Staffing agencies are responsible for providing necessary information for regulatory bodies to ensure compliance.
• The Labour Inspection Authority might set a fee for registration.
• Hiring from registered staffing agencies is allowed, with the Labour Inspection Authority overseeing compliance and issuing necessary decisions and orders.
• Violations of the regulation will be punishable under the Norwegian Labour Market Act.

There is a transitional agreement for the period from January 1 to March 31, 2024, during which employers can hire from staffing agencies that have submitted their approval application to the Labour Inspection Authority for processing.

UK: New Holiday Leave and Pay Guidance for Part-Year and Irregular Hours Workers

The UK’s Department of Business and Trade has released new guidelines for holiday entitlement and holiday pay. The guidelines bring in reforms to the Working Time Regulations 1998 and aim to simplify holiday entitlement and pay calculations, especially for part-year and irregular-hours employees.

The key changes, applicable for holiday years beginning on or after April 1, 2024, include:

• Revised holiday entitlement: Holiday entitlement will be calculated using an accrual method throughout the holiday year.
• Rolled-up holiday pay: Employers can now include additional holiday pay along with regular wages throughout the employment period, rather than giving the holiday pay when the holiday is taken.
• Extended carry-over for family-related leave: Unused family-related leave can be carried over for maternity, paternity, adoption, ordinary and shared parental, and parental bereavement leave.
• Long-term sickness provisions: Employees can now carry over up to four weeks of annual leave into the 18 months following the accrual year.
• Conditions for annual leave carry-over: The new guidelines also specify conditions under which employers must allow carry-over for the four weeks’ annual leave entitlement derived from EU law.
• Scope of “normal pay”: This has been broadened to encompass a wider range of remunerations but applies only to the four weeks’ holiday derived from EU law and to the payment of accrued holiday for part-year and irregular-hours workers.
• Annual leave management: Employers are now responsible for ensuring that workers utilise their statutory annual leave. Failure to facilitate, recognise, or remunerate annual leave appropriately will lead to the carry-over of up to four weeks of EU-derived leave.
• Removal of Covid-19 accrual leave: Any outstanding carry-over of leave untaken due to Covid-19 should be set by March 31, 2024.

Employers now need to review their employment contracts and holiday policies to ensure that any policy changes are made in time for the implementation date.

European Union: Pay Transparency Directive: New Employee Rights To Pay Information

Member states of the European Union have until June 2026 to formalise the Pay Transparency Directive into national legislation. Employers now need to prepare for more openness, not just about reporting gender pay disparities, but also providing employees information regarding pay. As part of the newly adopted directive, employees will be entitled to information regarding their pay before they apply for a job role. They can also seek details on how the pay is set by the employer, as well as what others performing equivalent jobs are being paid.

The Pay Transparency Directive aims to implement the principle of “equal pay for equal work” through greater transparency and stronger enforcement. It also focuses on pay discrepancies between men and women.

Once the EU member nations enforce national laws to enforce the new directive, employees will gain the right to ask for and receive written details on their pay and the average pay for “categories of workers performing the same work as them or work of equal value to theirs.” The Pay Transparency Directive supplements the employer’s obligation to report gender pay gaps for different categories of workers within the organisation. It is important to note that these categories go beyond classifying workers based on job role alone, and include roles that might be different but of “equal value.”

In addition, not only can individual employees request pay information, but workers’ representatives and equality agencies can also seek this data. This is crucial because it gives avenues to gain information for employees who might be hesitant to directly ask the employer and gain the data required to file a claim.

Another important caveat to note is that the information must be provided by the employer within two months of the requirements being submitted by the employee or the representative/agency. Employers must also keep employees informed of their right to seek this information annually, ensuring that employees are constantly aware of their right to seek pay information.

Employers in the EU need to start preparing to identify gender pay gaps, following which they will need to take steps to reduce this gap or find evidence to support differences in pay.

EU Lawmakers, Countries Reach Deal on Gig Workers’ Rights at Second Attempt

With the increasing use of digital platforms, gig work has not just become mainstream, but it is poised to grow exponentially. The European Commission expects the EU to be home to 43 million gig workers by 2025. Against this backdrop, EU lawmakers and member nations have been working on a draft law designed to improve the working conditions for this category of employees.

After having failed to reach an agreement on the law in December 2023, an agreement was reached on February 8, 2024, just ahead of the deadline for bills to be adopted before the European elections in June. The agreement has been criticised for being a “watered down” version of the original bill.

As part of the final agreement, EU countries need to modify their national law to include a mechanism that lays down the conditions under which gig workers will be considered employed. However, the member nations are free to decide on what these conditions would be.

This differs from the original proposal for EU-wide criteria to determine employment status. At the same time, it will give relief to gig workers who at present often turn to the courts to resolve issues regarding their employment status. Platforms, however, argue that the need to resort to litigation might not be completely eliminated by the new rules.

The delay in passing the bill was due to major disagreements between the member countries regarding the criteria to classify gig workers as employees. While some wanted the European Commission’s criteria to be removed altogether, the European Council itself preferred setting a high threshold for classification.

The newly passed bill also focuses on algorithm management, given that gig workers are often assigned tasks by an algorithm. Under the new rules, gig workers will have more visibility into the algorithms being used for task allocation.

Nearly 2,000 Companies Registered in Cyprus Through Business Facilitation Unit

At the Invest Cyprus event, held on February 9, 2024, government spokesperson, Konstantinos Letymbiotis, announced that close to 2,000 companies employing 19,000 skilled workers had registered in Cyprus since 2022, under the new Company Facilitation Unit. Letymbiotis added that 500 digital nomad visas have also been granted in the same timeframe.

The Cypriot “Fast Track Business Activation Mechanism” was transformed into the “Business Facilitation Unit” (BFU) with effect from January 1, 2022, making the BFU the single point of contact for foreign businesses. The objective of this unit is to ensure quick and efficient processing of requests from foreign companies to establish an entity in Cyprus or expand the activities of existing entities in the country. This is an important step in the government’s strategy to attract international investments and talent to Cyprus.

At Invest Cyprus, Konstantinos Letymbiotis also outlined further government actions and initiatives aimed at attracting foreign investment and talent.

Firstly, the Blue Card has been adopted and implemented to streamline labour mobility within the EU and attract highly skilled professionals.

Secondly, a new Housing Policy has been introduced. Key elements of this policy are the “Built to Rent” plan and revisions to the urban planning incentives. This initiative aims to increase the construction and supply of housing units to fulfil the rising demand for accommodation in the country.

Another initiative is the Law for the Facilitation of Strategic Investments, which has been implemented to streamline investment processes and promote a favourable environment for “strategic ventures.”

In addition, measures to ensure the smooth continuation of education for children of workers and investors living in Cyprus were outlined.

The government is also directing efforts towards strengthening access to funding through the creation of the National Development Agency and the Cyprus Capital Financing Fund. The aim is to ensure effective financial support mechanisms to facilitate investment and drive economic growth.

Finally, the government intends to continue to organise events to strengthen the dialogue with foreign investors and Cypriot businesspeople and bolster the investment and business environment in Cyprus.