In the revised Budget 2021, the government has refrained from introducing an 'employer period II' in the event of temporary lay-offs (known as 'furlough' in some jurisdictions).

Employers which temporarily lay off employees must pay the employees' wages during the employer period before the employee can apply for unemployment benefits. The employer period has been changed several times in the past year. At present, employers must pay 10 days' salary to temporarily laid-off employees.

The government had previously decided to introduce an employer period II for temporary lay-offs which exceeded 30 weeks within an 18-month period. This period was to consist of five days of compulsory pay for the employer and would encourage employers to bring temporarily laid-off employees back to work.

The government has now proposed that employer period II should not be introduced. The rationale for this proposal is that based on the current situation, employer period II would not serve as an incentive to bring employees back to work and would merely constitute an extra cost for companies which are already in a difficult financial situation.

For further information on this topic please contact Ole Kristian Olsby or Nina Elisabeth Thjømøe at Homble Olsby | Littler by telephone (+47 23 89 75 70) or email ([email protected] or [email protected]). The Homble Olsby | Littler website can be accessed at