Law firms IUNO (Anders Etgen Reitz, DK), Haavind (Pål Kvernaas, Norway), Krogerus (JP Alho, Finland) and Setterwalls (Åsa Erlandsson, Sweden) discuss how to manage good and bad performers across Nordic operations. 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.

1. Performance Management and Misconduct
in the Nordic Region
#nordic
hrlegal

2. Panel of experts
Anders Etgen Reitz, IUNO
Pål Kvernaas, Haavind
JP Alho, Krogerus
Åsa Erlandsson, Setterwalls

3. 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

4. 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.

5. 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.

6. 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)

7. 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.

8. Agenda
1. Managing good performers
• Performance management
• Incentive schemes
• Retention schemes
2. Managing bad performers
• Underperformance
• Misconduct
• Control and monitoring
• Termination

9. Managing good performers
Performance management

10. 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

11. Performance management
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]

12. Performance management
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.

13. Managing good performers
Incentive schemes

14. 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)

15. 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.

16. 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.

17. 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.

18. Incentive schemes: Target bonus
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.

19. Incentive schemes: Target 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

20. Incentive schemes: Target bonus
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.

21. Incentive schemes: Target bonus
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.

22. Incentive schemes: Target bonus
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)

23. Incentive schemes: Target bonus
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.

24. Incentive schemes: Target bonus
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.

25. Incentive schemes: Target bonus
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.

26. 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.

27. 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.

28. 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.

29. 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.

30. 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.

31. 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.

32. Managing good performers
Retention schemes

33. 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

34. Retention schemes
Finland
• Further education agreements
• Flexible working hours
• Flexible choosing of fringe benefits
• Changes to job titles and work tasks
Norway
• Further education agreements
• Flexible working hours
• Changes to job titles and work tasks
• Non-competition and non-solicitation clauses
• Pension arrangements in addition to membership in the obligatory
occupational collective pension scheme

35. 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.

36. 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.

37. 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.

38. 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.

39. 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.

40. 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.

41. 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.

42. Retention schemes: Non-solicitation and non-
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)

43. Retention schemes: Non-solicitation and non-
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.

44. Retention schemes: Non-solicitation and non-
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.

45. Managing bad performers
Underperformance

46. 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.

47. 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.

48. 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.

49. 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.

50. 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.

51. 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.

52. 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.

53. 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.

54. Managing bad performers
Misconduct

55. 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.

56. 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

57. 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.

58. 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.

59. 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.

60. 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.

61. Managing bad performers
Control and monitoring

62. 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.

63. Control and monitoring: General requirements
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.

64. Control and monitoring: General requirements
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.

65. 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.

66. 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.

67. 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.

68. Control and monitoring: E-mails
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.

69. Control and monitoring: E-mails
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.

70. Control and monitoring: E-mails
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

71. 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.

72. 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).

73. 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.

74. 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.

75. 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.

76. 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.

77. Control and monitoring: GPS
Are there any considerations when a Company is considering to
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.

78. 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.

79. Control and monitoring: Key stroke monitoring
Are there any considerations when a Company is considering to
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.

80. Control and monitoring: Key stroke monitoring
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.

81. Control and monitoring: Key stroke monitoring
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.

82. Control and monitoring: Key stroke monitoring
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.

83. 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.

84. 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.

85. Managing bad performers
Termination

86. 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.

87. 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.

88. Summarizing

89. Summarizing
What are the key issues to take home
from each Nordic country?

90. Åsa Erlandsson
asa.erlandsson@setterwalls.se
Pål Kvernaas
p.kvernaas@haavind.no
Anders Etgen Reitz
aer@iuno.dk
Jari-Pekka Alho
jp.alho@krogerus.com