Supreme Court sets a strict standard for “particularly independent” positions
The Supreme Court of Norway has, for the first time, considered whether an employee holds a “particularly independent position” and is therefore exempt from the working time rules in Chapter 10 of the Working Environment Act.
The case concerned a project manager at a construction company. Contrary to both the district court and the court of appeal, the Supreme Court found that the employee was not particularly independent. The judgment places particular emphasis on the employee’s ability to control their own workload and sets a strict standard for applying the exemption. In light of the judgment, employers should review their policies and practices on which positions are exempted from the working time and overtime rules.
The starting points for the assessment
The Supreme Court takes as its starting point the wording of the Act and the statements in the preparatory works that the exemption for a “particularly independent position” is intended to cover employees who do not have managerial functions but who nonetheless hold senior positions with significant responsibility. According to the preparatory works, it is not sufficient for the employee to control their own working hours or to have flexible working hours. The employee must also be able to decide for themselves what is to be done and how. Based on the statements in the preparatory works, the Supreme Court proceeds on the basis that this is a “narrow exemption”, but that an overall assessment must be made, in which the key considerations are whether the employee can decide for themselves:
- What is to be done
- What is to be delegated
- How the work is to be done, and
- When the work is to be done
The Supreme Court does not mention other potentially relevant factors, such as whether the employee has particular responsibility, for example professional responsibility or risk-taking, whether the employee has particularly complex duties or specialist expertise, or the level of pay. This is probably because these factors were not relevant in the case at hand, and we believe that these and other factors remain relevant in other types of cases.
The significance of internal vs external framework conditions for the employee’s independence
Since the central question is whether the employee decides over their own tasks and working hours, the Supreme Court holds that an employee who is in practice governed by their surroundings and other circumstances is not sufficiently independent. The Supreme Court clarifies that a concrete overall assessment must be made of the framework conditions the employee has to operate within, both internal framework conditions (that is, conditions set by the employer) and external framework conditions (that is, conditions set by customers or other third parties). The significance of external framework conditions has long been debated, including in legal literature. The Supreme Court has now established that external framework conditions, such as customer requirements and externally imposed deadlines, cannot be disregarded and must form part of an overall assessment.
It is nevertheless important to note that the fact that the employee has to operate within certain framework conditions does not preclude the position from being particularly independent. According to the Supreme Court, the decisive question is whether the framework conditions limit the employee’s ability to decide over their working hours “to a decisive degree”. The judgment offers little guidance on what is required for an employee to be regarded as governed by framework conditions “to a decisive degree”, and thus, on an overall assessment, not particularly independent.
The specific assessment of the project manager position
In its specific assessment of whether the project manager in this case was “particularly independent”, the Supreme Court takes as its starting point the district court’s and the court of appeal’s descriptions of the facts, which characterised the employment relationship as involving a relatively high degree of freedom and responsibility. The Supreme Court did not, however, agree with the specific assessments made by the lower courts, and referred only briefly to the fact that the employee:
- had limited ability to control their own workload;
- did not decide freely when the work was to be done (the Supreme Court here refers to the fact that he worked under framework conditions that effectively limited his ability to decide over his own working hours);
- had to ask for time off in lieu (which, according to the Supreme Court, indicated that he did not freely control his working hours); and
- could not say no to the tasks assigned to him.
The first-voting justice therefore found that, overall, the employee did not have genuine freedom to decide the scope and timing of his work.
Both the description of the facts and the specific assessment in the case are very brief. The judgment therefore provides limited guidance for drawing the line in other cases, and raises a number of questions, including what is required for an employee to be genuinely able to say no to a task.
What should we as employers do now?
As before, it is important that employers have good procedures for complying with the working time rules, including the use of the exemptions for “managerial” and “particularly independent” positions. In light of the judgment, employers should review their policies and practices for using these exemptions. More specifically, we recommend that employers:
- Map which positions in the organisation are classified as “managerial” or “particularly independent”. Bear in mind that the Act contains two separate exemption provisions. In light of the judgment, it may be advisable to specify which provision has been assessed. The mapping should be documented in writing.
- Evaluate whether the criteria used for the classification are adequate in light of the Supreme Court’s latest judgment.
- Discuss practice with employee representatives.
- Consider whether job descriptions need to be updated to ensure the necessary freedom and autonomy in positions intended to be particularly independent.
- Ensure that managers receive the necessary information, to avoid inadvertently restricting employees in particularly independent positions.
- Ensure that employees’ employment contracts contain the correct working time provisions, and that working time recording and overtime pay are applied for positions that do not qualify for an exemption.
We expect increased focus on the use of the “managerial” and “particularly independent” exemptions in light of the judgment, and other types of cases requiring further clarification from the courts may arise in future.
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