Your first employee: what needs to be in place before you run payroll

Is your sole proprietorship or small limited company (AS) about to hire its first employee? That comes with employer obligations that need to be in place before day one – whether you run payroll in Tripletex, Conta, PowerOffice Go, Fiken or eAccounting. Here is a practical checklist.

An employment contract before day one

Every employee must have a written employment contract, and it must be in place by the first day of work at the latest. The contract needs to describe job duties, working hours, pay and any allowances, notice periods and any probationary period. You can usually get a template from your trade association or your accountant – make sure it reflects the current Working Environment Act.

The a-melding and tax withholding

Once the employment starts, you must register it in the a-melding – no later than the 5th of the month after the first salary payment. The a-melding gathers information on employment, pay, tax withholding and employer’s national insurance contributions, and is sent to the Tax Administration, NAV and Statistics Norway in a single submission. Remember to retrieve the electronic tax card before running the first payroll, so the correct withholding is applied.

Mandatory occupational pension (OTP)

As soon as the business has at least one employee who meets the minimum requirements for age and position size, the OTP obligation can kick in – and for most businesses with employees it applies from the very first hire. The law sets a minimum requirement of 2 percent of pay between 0 and 12 G paid into a pension scheme. Many employers choose to save more than the minimum to be an attractive employer – settle on a savings rate and provider before the first payroll run, since the OTP deduction should normally appear on the payslip.

Occupational injury insurance

Occupational injury insurance is a legal requirement for every employer with employees, and must be in place before the employee starts work. The insurance covers injuries and illness arising from the job, and not having it can leave the employer with substantial liability if something happens. Most insurers offer this as a standard business policy – get in touch well in advance, don’t wait until the hire is a done deal.