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Management of Occupational pension scheme (OTP) for laid off employees

Management and rules of OTP for laid off employees.

Management and rules of OTP for laid off employees.

Rules and regulations

Main rule for defined contribution schemes (innskuddspensjonsordning) is that laid off employees shall be withdrawn/rolled out of the company`s pension scheme unless other wised agreed in the pension plan with your pension provider. The rules are set forth L24.11.2000 nr. 81 Lov om innskuddspensjon i arbeidsforhold §  4-3 (3).

We recommend that you contact your pension provider and get confirmation on what is applicable for your company. 

Impact for you as employer if the laid off employee is withdrawn from the pension scheme

Your company will not be liable to pay the defined contribution (saving), risks premium (waiver of contribution in case of disability) and administrative/administration costs for the laid off employee that are withdrawn from your scheme. 

Impact for your laid-off employee

Your laid-off employee will not be a member of the company pension scheme in the laid-off period with no OTP entitlements in the same period. 

Rules can be changed

NHO (Confederation of Norwegian Enterprise) and LO (Norwegian Confederation of Trade Unions) has together sent a proposal to the Norwegian authorities asking them to implement an alternative arrangement whereas laid-off employees can continue their membership in the company OTP scheme. How the coverage will be is under discussion. If this arrangement is approved we will keep you updated.

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