Norway has adopted what has become known as the nordic/Scandinavian economic model. In short, It combines key elements of capitalism such as having a free market economy and economic efficiency with social benefits.
Contrary to what many believe, a universal minimum wage is not applied in this system, including that in Norway. Instead, wages and working conditions are determined by collective agreements that are negotiated between labor and trade unions.
That being said, those same collective agreements have introduced minimum wages in certain industry segments. This is in part, to prevent foreign workers from being offered poorer pay and working conditions.
How the system works
In Norway, the vast majority of labor and trade unions are organized under larger umbrella organizations.
The largest labour unions are landsorganisasjonen (LO), and yrkesorganisasjonenes sentralforbund (YS). The largest trade unions are Næringslivets hovedorganisasjon (NHO) and Virke.
Every second year, these organizations negotiate collective agreements which have implications for the entire Norwegian workforce. One of the central themes of the negotiations is wages, but also working conditions, and pension plans.
The collective agreements are usually negotiated between the individual labor and trade unions for each sector.
For the private sector, collective agreements can be negotiated between the larger umbrella organizations, but this only occurs if there is a special situation in the economy or there are major overarching issues that apply to all workers.
Negotiations
The negotiation between the labor and trade unions for industrial workers and traditional export industries usually sets the level for the expected overall wage increase.
If the industrial and export industries experience a downturn, resulting in lower wages, it will also affect the wage negotiations between labor and trade unions for other industries.
For example, let’s say steel and oil companies that are vital to Norwegian exports experience a downturn, but construction companies are booming.
In this case, the negotiations will ensure that the overall wage increase for workers in all industries will be modest, and not higher than what the steel and oil companies can tolerate.
This will help steel and oil companies through the downturn. First of all by preventing a huge wage increase. Second, by preventing large emigration of workers and away from the steel and oil industry to the construction sector.
This ensures that the Norwegian export industries won’t be decimated even if they experience a downturn, which could make them unable to compete internationally, which would hurt the overall economy.
Effect
This system has been in place since the great depression in the 1930s and has resulted in a relatively steady collective increase in salary for workers in all industries and sectors.
It also helps explain why manual labor is paid much higher salaries in Norway compared to many other countries.
One might think that such as system does not comply with a market economy, but it could not be further from the truth. The system actually ensures that companies that fail to increase their productivity to be able to meet the collective wage increases are driven out of business.
This has made Norwegian companies and the Norwegian workforce one of the most productive in the world. It is also an important contributing factor to why wages for manual labor in Norway are so high.
Industries with minimum wages
As mentioned, some industries/sectors have predetermined minimum wage levels. These include:
- Construction
- Maritime construction
- Agriculture and horticulture
- Cleaning workers
- Fish processing industry
- Electricians
- Freight transport by road
- Passenger transport by tour bus
- Hotel, Restaurants, and catering
Among these segments, the lowest minimum wage is given to unskilled workers in the agriculture and horticulture sector at 143.05 NOK per hour (about 16 USD or 14 USD). However, lower wages are permitted for workers under the age of 18 and seasonal workers.
Minimum wages by industry
As mentioned, the collective agreements have determined minimum wage rates for certain industries. Norway has a lot of seasonal workers from abroad. And these minimum wages are one way to prevent foreign workers from being taken advantage of with lower wages.
The actual wage minimum wage between these sectors differs. They can also differ for skilled and unskilled workers, and for workers under the age of 18. Let’s take a look at the minimum wages for some of the most relevant jobs for foreigners.
Agriculture & farming
Many Norwegian farmers are dependent on seasonal workers from abroad. Unfortunately, there have been many cases where such workers have been paid illegally low wages. This should be avoided, and the easiest way is that workers to know the pay they are entitled to.
The minimum wage for agricultural workers depends on the age of the employee, the length of the employment, and whether they are skilled or unskilled.
| Age | Duration | Minimum wage |
| Under 18 | Up to 12 weeks | 103.15 NOK (12 USD or 10 EUR) |
| Under 18 | More than 12 weeks | 112.65 NOK (13 USD or 11 EUR) |
| Above 18 | Up to 12 weeks | 123.15 NOK (14 USD or 12 EUR) |
| Above 18 | Between 12-24 weeks | 128.65 (about 15 USD or 13 EUR) |
| Above 18 | More than 6 months | 143.05 NOK (17 USD or 14 EUR) |
Workers are also entitled to a weekend and holiday supplement of 25% between 1 pm and 12 pm on Saturdays, Christmas, and New Year’s eve. This supplement counts for all hours on Sundays and movable public holidays.
Cleaning workers
The minimum wage for cleaning workers depends on their age. They are also entitled to overtime for late-night work between 9 pm and 6 am of a minimum of 26 NOK per hour.
| Age | Minimum wage |
| Under 18 | 187.66 NOK (22 USD or 19 EUR) |
| Above 18 | 139.62 NOK (16 USD or 14 EUR) |
Fish processing enterprises
The minimum wages for workers in fish processing enterprises depend on their skill level, age, and whether they work in shifts
| Age | Skill level | Minimum wage |
| Under 18 | Unskilled | 80% of the minimum wage rate |
| Above 18 | Unskilled | 183.70 NOK (22 USD or 18 EUR) |
| Above 18 | Skilled | 195.20 NOK (23 USD or 19 EUR) |
When working in shifts, workers are entitled to a supplement of 20% of the minimum wage in a two-shift arrangement and 25% in a three-shift arrangement.
Electricians
The minimum wage for electricians carrying out installation assembly and maintenance of electrical systems for automation, computing, telecommunications, etc. depends on skill level and whether they work shifts or not.
| Skill level | Minimum wage |
| Unskilled | 189.52 NOK (22 USD or 19 EUR) |
| Skilled | 217.63 NOK (25 USD or 21 EUR) |
When working in shifts, workers are entitled to a supplement of 17% of the minimum wage in a two-shift arrangement and 27% in a three-shift arrangement. These rates do not apply to electricians working with offshore Petroleum installations.
Construction workers
The minimum wage for construction workers depends on both the age and skill level of the employee.
| Age | Skill | Minimum wage |
| Under 18 | Unskilled | 126.50 NOK (15 USD or 12 EUR) |
| Over 18 | Unskilled | 188.40 NOK (22 USD or 19 EUR) |
| Over 18 | Unskilled, but with at least 1-year working experience | 196.50 NOK (23 USD or 20 EUR) |
| Over 18 | Skilled | 209.70 NOK (25 USD or 21 EUR) |
There is no specific agreement with regard to overtime pay for construction workers. As of now, any overtime should be compensated with a supplement equal to 40% of the hourly rate, according to the Working Environment Act.
Maritime construction industry
Workers who perform production, assembly, and installation work in the maritime construction industry get a minimum wage according to skill level. Workers are also entitled to a supplement for work requiring overnight stays away from home, with the exception of workers taken on at the worksite.
| Skill level | Minimum wage | Overnight stay supplement |
| Unskilled | 162.60 NOK (19 USD or 16 EUR) | 32.52 NOK (4 USD or 3 EUR) |
| Semi-Skilled | 170.53 NOK (20 USD or 17 EUR) | 34.11 NOK (4 USD or 3 EUR) |
| Skilled | 178.55 NOK (21 USD or 18 EUR) | 35.71 NOK (4 USD or 3 EUR) |
At workplaces with shiftwork, workers are entitled to hourly supplements, depending on the time of day, shift structure, and shiftwork on public holidays.
In addition, a supplement corresponding to 50% of the hourly rate shall be paid for work in excess of normal working hours. For work in excess of normal working hours between 21.00 hours and 06.00 hours and on Sundays and public holidays, a supplement equal to 100 percent of the hourly rate shall be paid.
Freight transport by road (truck drivers)
Workers carrying out road freight transport with vehicles with a gross vehicle weight exceeding 3.5 tonnes are entitled to a minimum wage of 175.95 NOK (about 21 USD or 17 EUR).
Passenger transport by tour bus
Workers operating passenger transport by coach or bus when such transport is not subject to competition for licenses are to be paid a minimum wage of NOK 158.37 (19 USD or 16 EUR).
This also applies to employees of foreign undertakings provided that the transport assignment is organized in a manner involving the posting of workers as part of a temporary service provision, as defined by the Norwegian Working Environment Act. It does not apply to apprentices or persons taking part in labor market schemes.
Hotel, Restaurant, and catering
The minimum wage for workers in the hotel, restaurant, and catering industry depends on age and work experience.
| Age | Minimum wage |
| Over 20 | 167.90 NOK (20 USD or 17 EUR) |
| Over 18 with a minimum of 4 months of work experience | 167.90 NOK (20 USD or 17 EUR) |
| 18 years old | 134.09 NOK (16 USD or 13 EUR) |
| 17 years old | 119.83 NOK (14 USD or 12 EUR) |
| 16 years old | 110.33 NOK (13 USD or 11 EUR) |
If the workers are given lodging provided by the enterprise, a monthly amount is to be deducted from their monthly gross income. For a single room, the deduction is 361.45 NOK (43 USD or 36 EUR), and 555.73 (65 USD or 55 EUR) for a double room.
Wage deductions for lodging can only be made when employees live in simple, furnished lodgings, typically a single or a double bedroom in a hotel where the employee is working. If the enterprise provides more independent lodgings, with e.g. cooking facilities, the employer and employee must come to an agreement with regard to rent.
There are no rules with regard to evening, night, and weekend overtime supplements, but the employee and employer may stipulate various supplements in the employment agreement. Working hours and overtime arrangements must comply with the provisions of the Working Environment Act.
With regards to tips, the Norwegian Labour Inspection Authority does not consider tips part of the wages. However, If the employer reports tips as income and thus includes the tips in the calculation basis for holiday pay, taxes, and social security benefits, tips will be considered wages.
