NITO warns those who have long business trips abroad: You can lose up to NOK 1.5 million
Difficult AFP rules mean that more people are at risk of losing the money they will live on as a pensioner. A case in Cameron Sense AS is a horror and warning to those who work outside the borders of Norway and the EU.
Did your business trip abroad be longer than planned due to the pandemic? Watch out! NITO's associate, Malin Rogne, warns of rigid rules for contractual early retirement pension (AFP) that mean that several of NITO's members are at risk of losing money.
You may lose the opportunity to receive AFP early retirement pension
Richard Johnston (pictured) is a union representative in Cameron Sense AS, which is part of the Schlumberger Group. The company has production abroad and the employees are often on longer business trips outside the borders of Norway and the EU. Now several of Cameron's employees are at risk of losing up to NOK 1.5 million in pensions each.
The reason is that Johnston's colleagues travel on assignments all over the world to follow up on the production of equipment or install and start the equipment on the customer's oil rigs. Due to the pandemic, they have been given longer work stays abroad than originally planned, which creates problems for the employees.
- There are several hundred service people who are out at all times just from Southern Norway where we are located. We had longer periods in 2020 and 2021 With 14 days of entry quarantine in the country where the job was to be performed, and 14 days of quarantine when the employee returns home to Norway, the work period has become longer than what the AFP rules allow. Then you can lose the opportunity to get AFP," Johnston explains.
"This is a real pitfall, which people need to be aware of," he says.
These are the AFP rules for posted workers:
- To qualify for AFP, you must have been a member of the scheme for at least seven years in the period from the age of 53 to 62 (the period of seniority).
- As a general rule, posted workers do not have the time they work abroad included.
- Which employees are to be considered posted workers are not defined in the articles of association. Therefore, it is up to the Joint Scheme to interpret the scope of the exemption.
- The joint scheme is a collective bargaining body that administers contractual early retirement pension in the private sector. Their task is to collect premiums from covered enterprises and process applications from employees. They establish and interpret the articles of association for AFP, and this is where you will find the conditions for the right to AFP.
- The practice of the joint scheme shows that all business travel in excess of one month can be counted as posting, regardless of how the employee and the company itself define the trip.
- Employees who perform work abroad therefore risk losing the right to AFP early retirement pension due to lack of seniority in the scheme.
Employees are terrified of going out again
- I find that the Joint Scheme uses a formality to avoid paying AFP to members, says Johnston.
He refers to a colleague who applied to retire last summer, and who has not yet had his application processed.
- There is a lot of information that needs to be sent to the Joint Scheme, but once that information was sent over, they asked a lot of questions and coached the process. After six months, he still hasn't received an answer.
- The person in question has traveled a lot and is a specialist in an area few have knowledge of, which is why he is needed out on assignments. Now he is terrified of going abroad and only sits in his office. It's a great shame.
- Highly unreasonable
NITO's associate, Malin Rogne (pictured), asks members to be aware of this AFP trap.
- This seems highly unreasonable for the members who cannot necessarily choose whether they want to travel, or predict the length of the working hours on the trip, she says.
- The joint scheme may allow periods of posting to be included in the seniority period, but only after prior approval. It is not practical for our members who travel ad hoc to solve tasks at manufacturers or customers, often at short notice and without being able to know for sure how long the stay will be.
Rogne believes that a possible solution is for the Joint Scheme to allow for post-approval of periods of work abroad.
- This is what NITO has proposed for the Joint Scheme. The most important thing is that members become aware of the issue, and that employees between the ages of 53 and 62 can adapt to it by avoiding too many long-term stays abroad.
