nordic hr seminar 2015 - "performance management and misconduct"

Performance Management and Misconduct in the Nordic Region

#nordic

hrlegal

Panel of experts

Anders Etgen Reitz, IUNO

Pål Kvernaas, Haavind

JP Alho, Krogerus

Åsa Erlandsson, Setterwalls

About us

The panel is made up by four independent law firms advising clients

across the Nordic Region and leading within employment law

Each office has expertise, quality and resources to handle complex

international transactions and projects. Combined the firms have

offices throughout the Nordic region:

IUNO Copenhagen

Haavind Oslo

Krogerus Helsinki , Oulu, Jyväskylä, Kuopio, and Turku

Setterwalls Stockholm, Göteborg, and Malmö

Anders Etgen Reitz

Anders heads the HR Legal practice of IUNO.

Anders is a Council Member of the Global Employment Institute and

former Co-Chair of the Discrimination Law Committee under the

International Bar Association and past-Chair of the International

Employment Committee of the American Bar Association.

Anders is recommended by Chambers Europe, Legal 500, Who’s Who

Legal and other rankings in the area of Employment.

Pål Kvernaas

Pål is a partner and chairman of the board in Haavind, and a member

of Haavind’s Employment Law Department.

Pål is a member of several national and international employment law

and pension law associations, and is a regular speaker at national and

international Employment conferences.

Pål is recommended by Chambers Europe, Legal 500, Who’s Who and

other rankings in the area of Employment.

JP Alho

JP heads the Employment practice of Krogerus.

JP is a member of European Employment Law Association and the

International Bar Associations.

JP is recommended by Chambers Europe, Legal 500, PLC Which

Lawyer, Who’s Who Legal and other rankings in the area of

Employment and labour law.

JP has written a book on “Managing director agreements “ ´(Edita

2003)

Åsa Erlandsson

Åsa is the CEO of Setterwalls and a partner in Setterwalls’

Employment team.

Åsa is a member of various national and international employment

associations. She is regularly engaged as a speaker at national and

international employment seminars and conferences.

Åsa is a member of several professional networks, the Swedish Bar

Association’s Education Board and of the Chamber Council of

Stockholm Chamber of Commerce.

Åsa is recommended by Chambers Europe and Legal 500.

Agenda

1. Managing good performers

• Performance management

• Incentive schemes

• Retention schemes

2. Managing bad performers

• Underperformance

• Misconduct

• Control and monitoring

• Termination

Managing good performers

Performance management


Are there any legal pitfalls when structuring a performance

management system / process (performance reviews, personal

development interview, KPIs, etc.)?

Denmark/Sweden

• Soft targets

• Unrealistic targets

• Changes to targets

• Discrimination issues

• Work environment / stress-related issues

Norway

• Same as Denmark

• Special considerations in the probation period


The qualification interview (Example – Denmark)

An employee did not receive an invitation to a qualification interview

with the management during her maternity leave, as her colleagues.

The Equal Opportunity Board held that the employee had been

discriminated, as the company could not prove that the fact that they

had not invited the employee to an interview, was not partly due to the

maternity leave.

The employee was awarded a compensation of DKK 5,000.

[The Danish Equal Opportuniy Board, 13 December 2012]


Finland

The same general rules than in Denmark. The system should be

applied equally to all the employees, unless there is an acceptable

reason to treat certain employees differently due to their duties or

position. Statutory discrimination grounds offer the employee

additional protection. I.e. if the terms of an incentive schemes lead to

situation that an employee participating in an industrial action would

lose any benefits he would otherwise be entitled to the scheme may be

deemed discriminatory.


Incentive schemes

Incentive schemes

What kind of incentive schemes are available?

All

• Commission

• Discretionary bonus

• Target bonus

• Retention bonus

• Share-based schemes (stock options, warrants, free shares, share

purchase plans and similar schemes)

Incentive schemes: Discretionary bonus

Is it possible to have a discretionary bonus scheme?

Denmark

If the bonus is paid several years, salaried employees will have an

acquired right to the bonus. If the bonus has varied from year to year

the employee may have an entitlement to an average bonus.

Sweden

Yes. In very special cases, if the bonus is paid several years,

employees may have an acquired right to the bonus. If the bonus has

varied from year; it is more likely that the employer can uphold the

discretionary bonus scheme and decide upon a lower level. But, as

always, beware of discriminatory elements in the discretionary bonus.

Incentive schemes: Discretionary bonus

Finland and Norway

Yes. The employer should, however, pay attention to the equal

treatment and non-discrimination of the employees when allocating the

discretionary bonus, although it does not mean that they are entitled to

equal bonus. In addition, if bonus has been paid during several years

based on the same principles, the employee may have acquired a

permanent right to the bonus that cannot be changed unilaterally by the

employer.

Incentive schemes: Target bonus

Is it possible to change the bonus criteria during a bonus year or before

the beginning of a new bonus year?

Denmark

Changes to the bonus criteria may constitute significant changes to the

employment terms and conditions and such changes must be

introduced with notice. Changes to the market, which result in lower

bonus under the existing criteria is not considered a change to the

bonus criteria.


Finland

It depends on the agreement or bonus scheme. If the bonus scheme is

valid until further notice with no explicit possibility for the employer to

unilaterally change the bonus scheme, no changes can be made.

Therefore, when setting up the bonus criteria, it is recommended to

consider whether the employer shall have the right to change the

bonus criteria and in which situations.

Norway and Sweden

It depends on the agreement or bonus scheme. Therefore, when

setting up the bonus criteria, it is recommended to consider whether

the employer shall have the right to change the bonus criteria, in which

situations and with effect for which period. Normally an employer will

not be allowed to make changes that negatively affects already

accrued bonus.


Is the employee entitled to bonus in case of termination?

Denmark

Yes, salaried employees are entitled to prorated bonus in case of

termination for any cause.

Finland

It depends on the agreement or bonus scheme. In many situations, it is

agreed that the bonus will be paid provided that the employee is still

employed at the end of the bonus year / or at the payment date.

Norway and Sweden

It depends on the agreement or bonus scheme. If the agreement or

bonus scheme does not regulate this issue, the employee will normally

be entitled to a prorated bonus, including accrual in the notice period


Is the employee entitled to bonus during leave?

Denmark

In Denmark, the employee would be entitled to bonus if the policy of

the employment contract provides for full pay during leave. Under the

law female salaried employees are entitled to half pay during part of the

maternity leave, and such pay shall include bonus. Under the EU

Discrimination directive, employees may be entitled to certain kinds of

bonus even under unpaid leave.


Finland

Depends on the bonus scheme. However, the employer shall pay

attention to the prohibition of discrimination and equal treatment.

Discrimination is prohibited in the Finnish Employment Contracts Act,

the Act on the Equality between Women and Men as well as in the

Non-Discrimination Act. When an employee is absent due to reasons

that are connected to a prohibited ground for discrimination (e.g.

parental leaves), it is recommended that the bonus is prorated based

on the employee’s actual working time during the bonus period.


Norway

Depends on the bonus scheme. However, the employer shall pay

attention to the prohibition of discrimination and equal treatment.

Discrimination is prohibited in the Norwegian Working Environment Act,

the Act on the Equality between Women and Men as well as in the

Non-Discrimination Act. When an employee is absent due to reasons

that are connected to a prohibited ground for discrimination (e.g.

parental leaves), it is recommended that the bonus is prorated based

on the employee’s actual working time during the bonus period.

Sweden

Same as Finland and Norway (but other law references, e.g. the

Swedish Parental Leave Act and the Discrimination Act)


Does an employee have the right to remuneration during sick leave?

Denmark

The rules vary depending on whether the employee is a salaried

employee or a blue collar worker. Salaried employees are entitled to

full pay during sickness absence, which includes the right to bonus. For

individual target bonuses, the company may need to adjust the targets

to accommodate for the sick leave.


Sweden

Sick Pay is paid from the employer day 2-14 (no payment day 1) and

from the Social Security Office thereafter. Payment equals 80% of

salary however capped ad certain amount based on salary – including

bonus payments.

Finland

It depends on the agreement or bonus scheme. Prerequisite is that the

employee is entitled to remuneration during sick leave but this does not

guarantee that the employee is entitled to compensation for incentive

schemes.


Norway

Day 1-16: The employer pays 100 % of the salary limited up to

approximately EUR 67,500. Whether any target bonus shall be

included in the salary basis for sick leave pay has to be assessed case

by case.

Thereafter: Unless agreed otherwise, the employee has to report to the

Social Security Office and get continued pay by the National Insurance.

Incentive schemes: Retention bonus

May a retention remuneration be conditional on the employee not

terminating his or her contract of employment for a specific period?

Denmark

The Danish Supreme Court has accepted the use of retention bonuses

which are conditional on the employee not terminating his contract of

employment for a specific period. The ruling is however limited to

extraordinary situations and limited bonus amounts.

Sweden

In general, yes. Also fairly commonly used.

Incentive schemes: Retention bonus

Finland

No case law exists, but as the retention bonus does not limit the

employees right to terminate the employment agreement, and the

employee only loses the additional bonus, there is no reason why it

should be considered unreasonable and thus invalid.

Norway

Yes. The Norwegian Supreme Court has accepted the use of retention

bonuses which are conditional on the employee not terminating his

contract of employment for a specific period. However, the restricted

period has to be reasonable compared to the bonus amount.

Incentive schemes: Holiday

Is the employee entitled to holiday pay based on bonus or other

variable compensation?

Denmark

During the employment, the employee is entitled to his/her usual pay

during holiday, which will include average commission, but not annual

bonuses.

In case of termination, 12,5% is calculated on the basis of all income

taxed compensation, including bonus, commission, etc.

Stock options and similar share schemes are expressly exempt from

holiday pay.

Incentive schemes: Holiday

Finland

The employee is entitled to receive his regular salary during the annual

holiday. If the bonus accrues also during the annual holiday it is not

taken into account when defining the holiday pay. However, if the

bonus does not accrue during the annual holiday the bonus accrued

during the holiday credit year should be taken into account when

defining the holiday pay

Sweden

In principle yes. (But in practice it is often explicitly stated in bonus

schemes that bonus should not accrue holiday pay.)

Norway

The same applies as for fixed salary, unless the calculation of the

bonus is not related to the employee’s performance and presence at

work, for example a bonus purely base on company results.

Incentive schemes: Stock options

Is the employee entitled to options in case of termination of the

employment?

Denmark

The right to keep stock options in case of termination of the

employment is dependent on whether it is the employee or the

employer, who is terminating the contract and on the cause for the

termination (good/bad leaver). The issue is regulated by the stock

option agreement and the stock option act, which is mandatory.

Sweden

The right to keep stock options post employment can be restricted by

the employer in a policy. However, not lawful to restrict specifically

during notice period. No stock option act. Question of the benefit being

contractual or non-contractual.

Incentive schemes: Stock options

Finland

Depends on the rules of the option scheme. As options are used as

incentives, the employee usually loses the right to exercise option

rights, if the employment is terminated for any other reasons than death

or retirement of the employee.

Norway

Norway has no stock option act that regulates this situation, and this

the answer depends on the rules of the option scheme. Such rules

normally differs between good leavers and bad leavers, with the first

group normally in a better position than the latter.


Retention schemes

Retention schemes

Which initiatives may an employer undertake in order to retain valuable

employees (aside from remuneration)?

Denmark and Sweden

• Flexible pay packages

• Further education agreements

• Flexible working hours

• Changes to job titles and work tasks

• Non-competition and non-solicitation clauses

Retention schemes

Finland



• Flexible choosing of fringe benefits


Norway




• Non-competition and non-solicitation clauses

• Pension arrangements in addition to membership in the obligatory

occupational collective pension scheme

Retention schemes: Further education

Which legal issues may arise when introducing agreements on further

education (executive MBAs etc.)?

Denmark and Sweden

It is possible to agree on claw backs if the employee leaves during an

agreed period of time following the education. There are tax

advantages even if the employee covers the cost through salary

reductions. The education agreement has to be drafted carefully.

Finland

If the employer agrees to pay expenses for an education program, it is

common to agree that the employee agrees to work for the employer

for a certain period of time, or otherwise the employee may be obliged

to reimburse the amount paid by the employer wholly or partly.

.

Retention schemes: Further education

Norway

If the employer agrees to pay expenses for an education programme, it

is common to agree that the employee agrees to work for the employer

for a certain period of time, or otherwise the employee may be obliged

to reimburse the amount paid by the employer wholly or partly. Up to a

certain level the employee may receive such benefit from the employer

without having to pay income tax.

Retention schemes: Flexible working hours

Which legal issues may arise from introducing flexible working hours?

Denmark

It is important to be aware of work hour rules, and rules on the proper

design of a home of office from a work environment perspective.

Changes to flexible working hours may need to be introduced with

notice.

Sweden

It is important to be aware of work hour regulation and working

environment issues.

Retention schemes: Flexible working hours

Finland

The employer has an obligation to keep a working hours register.

Additionally, the rules of the Finnish Working Hours Act shall be

complied with e.g. in regards to the daily overtime regulations.

Changes in working hours arrangements may require a separate

agreement between the employer and the employee or termination

ground and notice.

Norway

The employer has an obligation to keep a working hours register.

Additionally, the rules of the Norwegian Working Environment Act shall

be complied with e.g. in regards to the daily working time/overtime

regulations. It is important to be aware of the rules on the proper design

of a home of office from a work environment perspective. Changes to

flexible working hours may need to be introduced with notice.

Retention schemes: Changing titles

Which legal issues may arise from changing job titles and work tasks?

Denmark

If the organisational structure becomes more vague, this can affect the

ability to restructure the company without notice, and the obligation to

offer ”similar positions” in case of termination of protected employees.

Sweden

Depends on what the employment agreement says. For salaried

employees, ”minor” changes can normally be made by the employer’s

unilateral decision. No notice period. More essential changes can be

carried out but a special procedure must be followed (technical

redundancy). For workers, they are normally obliged to carry out all

such work tasks that has a natural connection with the employer’s

business and that fall within the employee’s general qualifications.

Retention schemes: Changing titles

Finland

If the work tasks and job titles are significantly unilaterally changed by

the employer more than what would be acceptable based on the

employment agreement and the Finnish Employment Contracts Act,

the change in work tasks may in some cases entitle the employee to

terminate the employment relationship and claim for compensation for

the unjustified termination of the employment.

Norway

If the work tasks and job titles are significantly unilaterally changed by

the employer, and more than what would be acceptable based on the

employment agreement, the change may be regarded as a factual

termination of the employment. Thus, the employer will need

sufficiently due cause and followed required procedure to implement a

substantial change in the employment. If not, the employee may claim

for compensation for the unjustified termination of the employment.

Retention schemes: Non-solicitation and non-

competition clauses

Which legal issues may arise from introducing non-competition and

non-solicitation clauses?

Denmark

According to the Salaried Employees Act, non-competition and non-

solicitation clauses must be drafted to meet specific requirements,

among which is the condition that the employer pays compensation of

at least 50% of the employee’s gross salary at the time of termination.

NB (New Bill): The Government has introduced a Bill, which will

change the compensation to 40% or 60% depending on the length and

scope of the clause. The right to set-off will be reduced, and the ability

to introduce non-solicitation of employee clauses or no-hire clauses will

be close to non-existent.


competition clauses

Sweden

A non-compete can be deemed as ”unfair” and accordingly void. Non-

solicitation restrictions are generally easier to enforce. One important

condition for a non-compete not to be considered unfair is that the

employee is compensated with at least 60% of salary during the non-

compete period. Another important condition is that the period is not

too long – normally 6-12 months.

Plenty of case law – case by case assessment. (New collective

bargaining agreement on non-compete clauses as of 1 December

2015)


competition clauses

Finland

According to the Finnish law the non-competition agreement may only

be made for a particularly weighty reason related to the operations of

the employer. The legal issues mainly relate to whether or not the

weighty grounds exist and if the non-competition agreement is valid.

The meaning of a valid non-competition clause is to protect employers

business, not to limit employee's right to change an employer.

If no liquidated damages clause is agreed in connection with the non-

solicitation clause the employer may have difficulties to demonstrate

the actual damages.


competition clauses

Norway

According to the Norwegian Contract Act, a non-competition agreement

may only be made for leading employees / managers and employees

with special insight to information that is highly sensitive to competing

businesses. Regardless of which employee category the employee

belongs to, the agreement has to be reasonable. For the agreement to

be reasonable, the employer has to consider carefully the length of the

non-compete period, and whether to pay compensation to the

employee.

New legislation that restricts further the use of non-compete clauses

are on it’s way, so important to draft clauses that allows the employer

to unilaterally change the clause if needed due to new legislation.

Managing bad performers

Underperformance

Underperformance

What steps is the employer required to take before terminating an

employee for underperformance?

Denmark

The employer must first give oral warnings, and finally, the employer

must give the employee a written warning. The underperformance

should be related to circumstances within the employee’s control. The

written warning must: (1) be clear and precise, (2) describe the

behaviour which must be improved, and (3) the consequences if the

behaviour does not improve. The warning letter should include a follow-

up process, but not necessarily a deadline.

Sweden

Warning and support process; oral and in written. Not formalized and

no ”end date”. Awareness of expectations and consequences is very

important.

Underperformance

Finland and Norway

The employee should be given a written warning and given a chance to

correct the underperformance. In practice, it is required that the

employer has not passively accepted a certain level of performance

and the underperformance should be related to circumstances within

the employee’s control. In addition, the employer should offer the

employee sufficient support to meet the requirements and the

employee should also be aware of the required level of performance.

Underperformance: Performance improvement plans

Can a Performance Improvement Plan (PIP) constitute sufficient written

warning?

Denmark

It depends on the wording, but the standard PIPs do not contain

sufficient wording to constitute a written warning. The disciplinary

procedure would therefore often have to be initiated following the PIP

process.

Sweden

Usually the PIP is part of the process; but a low rating and a PIP is not

sufficient in order to establish a reason for termination.

Underperformance: Performance improvement plans

Finland and Norway

It depends on the wording, if the PIP makes it clear that the

continuance of the similar behaviour may lead to the termination of the

employment, then yes.

Underperformance: Warnings

How long time must the employer wait from the written warning and

until the employee can be terminated for the underperformance?

All

There is no clear rule on this issue. The employee must be given a real

chance to improve his or her performance before being dismissed. On

the other hand the employment may, however, not be terminated if the

warning has become outdated.

Underperformance: Promotions or salary increases

Does it affect the improvement process, if the employee is promoted or

receives a salary increase during the process?

Denmark

Yes, a promotion or salary increase during an improvement process

will likely mean that the process will need to start over with new

warnings, etc.

Finland, Sweden and Norway

If the salary increase is based on the rules of the collective bargaining

agreement, it does not have any significance on the matter. Otherwise

it may be difficult to claim that the employee has not improved the

performance sufficiently if he is promoted or given extra salary increase

during the process. Therefore, such actions may, in practice, make any

prior warning etc. outdated.

Underperformance: Capability

Will it affect an improvement process, if the employee is incapable of

carrying out the tasks required due to lack of skills?

Denmark

Yes, if the company can prove that the employee is objectively

incapable of carrying out the necessary tasks, an improvement process

will be pointless. However, if the inability to carry out the tasks is due to

a disability, the company may be obliged to adapt the work or

workplace.

Finland

If the employee does not have required skills the employment should

be terminated during the trial period. If there is a significant change in

the employees skills after that it would be recommended to take

necessary improvement process anyway, since the employer has the

burden of proof that such process would have been pointless, which

may be difficult.

Underperformance: Capability

Sweden

As in Finland. But before a court would agree that the employee is

incapable of carrying out the job, the employee’s job performance must

be essentially lower than what the employer could reasonably expect

and the problem could not be solved by moving the employee to

another position. Also, as in Denmark: if the inability is due to a

disability, the company may be obliged to adapt the work or workplace.

Norway

Yes, however the employee’s job performance must (i) be essentially

lower than what the employer could reasonably expect, and (ii) the

employer has had to put reasonable effort in to helping the employee to

improve. The latter will include reasonable training if the requirements

for the position has changed, for example due to technological

development.


Misconduct

Misconduct

What types of misconduct could justify termination with/without notice?

Denmark

Without notice: Ordinary misconduct, such as underperformance,

disloyalty, collaboration issues. Usually requires prior written warnings.

With notice: Gross misconduct such as unexplained absence, theft,

engaging in competitive actions, disloyalty, inappropriate behavior,

insubordination, etc. Sometimes requires prior written warning.

Misconduct

Sweden

Without notice: Seriously set aside obligations in employment

relationship. E.g. theft, threat and violence at the work place but also

disloyalty such as preparing or conducting a competing business etc.

Disloyal statements on social media?

With notice: Misbehaviour (after warnings etc), bad performance (after

support and no possibility to move to other positions). In rare cases

also sickness (where the employee cannot perform work of any

essence, the employer has fulfilled rehabilitation obligation and no

possibility to move to other positions

Misconduct

Finland

The justified ground for termination always requires an overall

assessment of the situation and all of the circumstances (written

warning, position of the employee, recurrence, etc.). In Finnish case

law, the following types of misconduct have justified the termination of

the employment: abuse of alcohol; criminal offence; rude or inapt

conduct towards the customers, co-workers or employer; violence; and

even attending to a TV-show where the name of the employer is

mentioned several times and the employee reveals attitudes and

actions which are contrary to the employer’s values and rules.

Misconduct

Norway

The justified ground for termination always requires an overall

assessment of the situation and all of the circumstances (written

warning, position of the employee, recurrence, type of misconduct etc.).

Termination with notice requires that the misconduct represents ”due

case”.

Termination without notice requires gross breach of duty or other

serious breach of the employment contract.

Misconduct: Violation of policies

Is it possible to terminate an employee who has violated a policy (code

of conduct, IT, social media, etc.)?

Denmark/Sweden

Whether an employee can be terminated because of the employee’s

violation of a policy, depends on, whether the policy has been received,

and possible read and understood by the employee.

Even with a clear policy, it also depends on the type of misconduct. A

warning may still be needed.

Misconduct: Violation of policies

Finland

If the employer may demonstrate that the employee has read and

understood a clear policy that also clearly specifies that if the policy is

violated the employment may be terminated and the employee has

substantially violated the policy, then yes. Additionally, the policy

should have been applied equally to all employees.

Norway

As in Finland, however whether the violation is serious enough to

represent due cause for termination will always require an overall

assessment of the situation and all of the circumstances.


Control and monitoring

Control and monitoring: General requirements

Are there any general requirements which must be fulfilled when

introducing control measures?

Denmark

The right to introduce control measures is part of the employer’s so-

called “managerial right”.

However, control measures must be: (1) objectively justified for

business reasons, (2) have a reasonable objective, (3) not violate the

integrity of the employee and (4) not result in a loss for the employee or

noticeable inconvenience.


Sweden

The right to introduce control measures is part of the employer’s

“managerial right”. Controls for certain purposes – i.e. in order to

calculate the salary and evaluating the work process etc. – are justified.

Controls that have a more specific impact on the integrity of the

employees must be proportional in line with the Danish regulation.


Finland

The employers have a general right to control the employees without

any specific criteria. However, technical control of the employees and

the use of e-mails and data systems / communication networks is

restricted and requires, inter alia, prior consultations with the personnel.

Norway

Control measures may be introduced as part of the employer’s

managerial rights. However, the measures must have a justifiable

reason and must not be disproportionate. The employer is also obliged

to inform the employees about the control, before introducing the

control measures.

Control and monitoring: Consultation

Are there any consultation requirements?

Denmark and Sweden

Yes, if employer is subject to a collective agreement. Information

obligation according to Data Protection Act with respect to e-mail and

internet monitoring.

Norway

Control measures has to be discussed with the employee-

representatives, before the measures are adopted.

The necessity of the measures also has be discussed with the

employee-representatives on a regular basis.

Control and monitoring: Consultation

Finland

Yes (for companies with 20 or more employees). The employer must

consult the personnel in advance on:

• the technical controlling of the employees;

• the principles of the use of e-mails and IT-system/communication

networks;

• how and which personal data on the employees is collected and

used by the employer; and

• the tasks in which the employer requires drug tests.

Control and monitoring: E-mails

May the Company monitor the employees’ e-mails, both private and

business related?

Denmark

Disputed whether an employer may claim that all mails belong to the

employer, i.e. no private e-mails. Generally only read business related

but also disputed what constitutes a private mail. Danish Penal Code

prohibits the reading of private correspondence.

Data Protection Agency has accepted the copying of e-mails for

operation purposes (safety, restoring and documentation). Employees

must be informed about the monitoring.


Sweden

The Personal Data Act applies. Monitoring requires the consent of the

employee or that the interest of the employer to monitor outweigh the

disadvantages of the employees (business related e-mails only).

No such procedure as in Finland applies.


Finland

The employer’s right to monitor and/or read the employee’s work

related e-mails is very strictly regulated in the privacy at work

legislation. The employer is never allowed to read the employee’s

private e-mails and the monitoring of the employee’s e-mail

correspondence is forbidden.

The employer’s right to read the employee’s work related e-mails may

be based on the employee’s express consent, but the consent may

always be withdrawn. If no prior consent exists, the law sets forth

certain requirements and a detailed procedure on how the employer

may (or may not!) gain access to the employee’s e-mails in his/her

absence.


Norway

Monitoring is only lawful when it is necessary to protect the legitimate

interests of the company. Accordingly, monitoring private e-mails will

hardly ever be legal. There are strict procedures on how such

monitoring should be carried out:

• The employee shall be informed in writing, and should be allowed to

present his opinion on the necessity of the monitoring.

• The employee is entitled to be present and to bring a representative.

• In case of urgency, special procedures apply

Control and monitoring: Text messages

May the Company monitor the employees’ text messages, both private

and business related?

Denmark

In Denmark, the monitoring of text messages is covered by the

protection of private communication, which is subject to criminal

liability. In a recent case, the court found that the management’s

monitoring of text messages on work phones were in violation of the

protection. The management were nonetheless acquitted for specific

reasons.

Finland and Sweden

Any text messages as well as e-mails of an employee are considered

private communication, and its secrecy is protected by law. Any breach

of the confidentiality is subject to criminal liability.

Control and monitoring: Text messages

Norway

Same as for email, provided that the the employer himself has provided

the phone. Monitoring is only lawful when it is necessary to protect the

legitimate interests of the company. Accordingly, monitoring private text

messages will hardly ever be legal.

There are strict procedures on how such monitoring should be carried

out (see previous slide regarding e-mails).

Control and monitoring: Websites

May the Company monitor what websites are visited?

Denmark

Logging of employees’ internet use is permitted. The employees must

be informed about the logging.

Random checking whether the employees comply with the internet

policy is likely not acceptable unless the policy implies that no private

use is at all permitted. In case of suspicion of breach of the policy the

employer may review the log and the employee’s computer.

Sweden

In case of suspicion of breach of a policy the employer may review the

log and the employee’s computer.

Control and monitoring: Websites

Finland

No. Employees’ use of internet is considered as communication, and

its secrecy is protected by law. (Collecting information on the websites

the employee has visited is also considered as collection of personal

data under Finnish law. Such collection is prohibited unless the

employer has a valid work related reason for it.)

Norway

Same rules applies as with monitoring of e-mails.

Control and monitoring: BYODs

Are there any considerations when a Company is considering to

introduce BYOD policies?

Denmark and Norway

The employer can only demand access to search through electronic

devices used by employees that the employer himself has provided. If

the employee uses a personal device the employer cannot demand

access to, or to search through, e.g. the PC or phone.

Sweden

Not yet tried by Swedish Data Protection Authorities. BYOD-solutions

are ok in principle. But must be carefully considered. The employer

must take care of the risk that the employees’ private and professional

matters are mixed-up. Ensure that any processing of data is in

accordance with PDA. At the same time limited possibilities to access

the devices because the employee’s personal integrity must be

protected.

Control and monitoring: BYODs

Finland

General principles and restriction in relation to processing of personal

data apply. If technical monitoring is conducted based on the use of

any devices, obligations in relation the technical monitoring shall be

observed.

Protection of privacy of emails or other means of communication shall

be observed.

The employer is not allowed to monitor the employee's use of internet.

Control and monitoring: GPS


introduce GPS monitoring?

All

Monitoring and collecting data from GPS will be regarded as

processing personal data and the general requirements in relation to

processing of personal data and technical monitoring of employees

shall be observed:

• shall be necessary and justified

• obligation to consult with the employees prior to implementation

• to define purpose, methods of supervision and to inform the

employees of the purpose, methods and implementation etc.

Control and monitoring: GPS

The Waste Disposal Company (Example - Norway)

A waste disposal company introduced GPS-monitoring to increase the

efficiency of their driving routes. At a later time the employer compared

the GPS-logs to an employee’s time sheet. The employer discovered

several irregular breaks, and ended up dismissing the employee in

question.

The courts stated that the dismissal was just, but that the employer’s

actions was in violation of the PDA as the use of the personal data was

outside of the purpose of the collection of the same data. Nonetheless

the court found that the actions did not constitute a violation serious

enough to provide liability for economic damages.

Control and monitoring: Key stroke monitoring


introduce key stroke monitoring?

Denmark

The general requirements of processing personal data and

implementing technical monitoring of employees shall be observed.

If the policy is clear and implemented properly it is likely that the

monitoring would be accepted in Denmark, if mainly for business and

security purposes, and the ordinary rules on information, access,

deletion, security, etc. are observed.


Finland

Unlikely, the employer is not allowed to technically monitor the

employee's use of internet. Additionally, the employee’s e-mails are

protected as privileged communication. Therefore, the possibility to use

key stroke monitoring, would, in practice, be quite limited.

In any situation the general requirements of processing personal data

and implementing technical monitoring of employees must be

observed.


Norway

A measure like KSM would be well suited for processing a large

amount of an employee’s digital actions. The existence of other less

invasive measures such as access to employee email accounts and

surveillance of internet usage, makes the employers necessity to

introduce a measure like KSM debatable, and unless subject to heavy

restrictions it would most probably be disproportionate and constitute a

violation of statutory rules.


Sweden

The general requirements of processing personal data and

implementing technical monitoring of employees shall be observed. Not

tried by Swedish Data Protection Authorities but probably

disproportionate in most businesses but exceptions could apply in

certain businesses.

Control and monitoring: Health performance

May the company monitor employees’ health performance (biometric

performance monitoring on devices like Apple Watch), carry out health

checks, etc.

Denmark

The Danish Act on Health Information prevents companies from

collecting health information without employee consent. Even with

consent, companies would only be able to collect limited health

information, which is strictly necessary to carry out the work.

Processing of health information is so-called sensitive personal data,

and may require approval from the Data Protection Agency.

Control and monitoring: Health performance

Finland and Sweden

No. Based on the Personal Data Act and Act on the Protection of

Privacy in Working Life the information on an employee’s health is

deemed as sensitive informaiton and it may only be processed for

statutory defined purposes with his written consent from someone else.

Norway

Only if monitoring is (i) specifically allowed by law for the position/work

in question, (ii) for positions that are exposed for especially high risk, or

(iii) the employer finds it necessary to protect health and safety.

Processing of health information is so-called sensitive personal data,

and may require approval from the Data Protection Agency.


Termination

Termination

What are the consequences if the termination is not deemed justified?

Denmark

As a general rule, the fact that a dismissal is considered to be without

just cause does not render the dismissal void. Instead, the employee

may be entitled to a financial compensation. Under the Danish Salaried

Employees Act, this requires at least one year’s employment whereas it

requires nine months’ employment if the employee is appointed on a

collective agreement basis.

Sweden

A wrongful dismissal can be declared void; i.e. the employee will be

reinstalled. Payment throughout the whole dispute. Alternatively,

economical damages; 16-32 times the monthly salary. General (moral)

damages as well.

Termination

Finland

If the employer did not have a valid ground for terminating the

employment, the employee may claim compensation for unjustified

termination of the employment. The compensation may be up to 24

months’ salary of the employee in question.

Norway

A wrongful dismissal can be declared void; i.e. the employee will

continue the employment as before. The employee will as a basis be

entitled to remain in his position and maintain tasks, responsibilities,

benefits etc. under the dispute and until the case is finally settled by the

courts. In special cases, the court may decide that the employment

shall cease even though the dismissal is void. If so, the employee will

receive compensation for anticipated future loss of salary. The

employee will normally also be entitled to a compensation for non-

economical damages in the range of EUR 2,000 – 8,000.

Summarizing

Summarizing

What are the key issues to take home

from each Nordic country?

Åsa Erlandsson

[email protected]

Pål Kvernaas

[email protected]

Anders Etgen Reitz

[email protected]

Jari-Pekka Alho

[email protected]

nordic hr seminar 2015 - "performance management and misconduct"

Leadership & Management