Contractor or employee?

Last week, Oslo District Court handed down a judgement in the so-called Wolt case, in which three Wolt couriers won their claim that they were to be regarded as employees, despite having entered into agreements as independent contractors. The judgement is not legally binding and is one of many pending cases concerning the important distinction between contractor and employee.

The many cases on this topic are due to the fact that the definition of ‘employee’ in section 1-8 of the Working Environment Act was clarified from 1 January 2024, in combination with a new burden of proof rule which means that an employment contract exists unless the client makes it ‘highly probable’ that an independent contractual agreement exists.

The preparatory work for the amendment assumed that the updated definition and burden of proof rule could lead to more legal disputes, and they were right. The judgements that have been handed down so far show that the outcome varies from industry to industry, and between different types of labour offered. 

The judgements also show that a careful and specific assessment is made of the individual type of case that is legally tested. The impression so far is that the judgements confirm that the amendment did not expand the concept of employee in the Working Environment Act, but that cases that were previously in a grey area can now be clarified more easily through the burden of proof rule.

In the detailed assessment of whether the employee is subject to ‘management, leadership and control’, a purpose-oriented approach is used where the specific need for protection, and the question of subordination (economic or organisational dependence) is particularly central.

The so-called ‘seven-point list’ - which specifies factors that are included in an overall assessment - is still relevant, but the impression is that it varies how the factors are used by the courts in the specific assessments.

In the Wolt case, the majority of the District Court found that the factors pulled in different directions, but that the subordination was so pronounced that the couriers needed the protection afforded by the Working Environment Act.

As a result, the couriers were found to be employees, and thus also found in favour of some - but not all - of the financial claims made in the case. The judgement is a new example of how misjudgements - when drawing the line between contractor and employee - can lead to large financial claims in retrospect.

It may therefore be wise to make an updated and thorough assessment of the agreements that the company has with independent contractors. Littler has extensive experience in advising on this topic and can assist in all areas of Norwegian working life.