Nine staffing firms have filed a damages claim against the Norwegian government following the introduction of a clampdown on the rules for staffing and subcontracting, reports The Local Norway. A damages claim of NOK 35 million (€3.0 million) has been filed against the Norwegian state due to new labour hiring laws, which the firms suing the state believe breach a EEA (European Economic Area) agreement.

The claim relates to a change of law introduced on 1 April by the Norwegian government. The new rules have made it harder for employers to outsource or subcontract staff from recruitment firms. A total ban was also introduced on subcontracting across Oslo, Viken and the former Vestfold county.

“The lawsuit is based on EFTA's monitoring body being right that Norway has broken the EEA agreement,” lawyer Nicolay Skarning at the law firm Simonsen, Vogt and Wiig said to Norwegian newswire NTB (Norwegian News Agency). We will have this clarified by the EFTA court. If it confirms a breach of the EEA agreement, the state is liable to compensate all those who have lost money due to the staffing restrictions, which were introduced from April 1st this year.”

The EFTA Surveillance Authority (ESA), which monitors compliance with EEA regulations, has previously said that the crackdown is ‘unjustified and disproportionate’. It added that the new regulations were in breach of the temporary agency directive and the freedom to provide services within the EEA. In July, a formal letter was sent by the ESA to Norway asking the state to address the concerns. Under ESA procedure, Norway has two months from when the letter was issued to express its arguments that the new regulations do not breach EEA directives before the matter can be taken to the EFTA court. Earlier this summer, 30 staffing companies lost a court case against the state in the Oslo district court. The companies believe the changes constitute a breach of the EEA agreement and have taken their case to the court of appeal.