In Norway, industrial disputes that have been referred to compulsory arbitration are decided by the National Wage Board. In August 2004, the Board ruled in favour of the Norwegian Oil Industry Association (OLF) employers' organisation in a dispute with the Federation of Oil Workers' Trade Unions (OFS) and the Norwegian Organisation for Managers and Supervisors (Lederne). The ruling is seen by the two trade unions to be biased and undemocratic, and they have chosen to withdraw from further participation in the National Wage Board.
On 17 August 2004, the National Wage Board (Rikslønnsnemnda) ruled in favour of the Norwegian Oil Industry Association (Oljeindustriens Landsforening, OLF) in a collective bargaining dispute between OLF and the Federation of Oil Workers' Trade Unions (Oljearbeidernes Fellessammenslutning, OFS) and the Norwegian Organisation for Managers and Supervisors (Lederne) (NO0407102N). Industrial disputes that, like the recent oil industry dispute, have been stopped by means of compulsory arbitration (NO9704109N and NO9812104F), either through a provisional ordinance or an act of parliament, are automatically transferred to the National Wage Board for settlement. The Board's ruling in these cases has the same effect as a collective agreement, to which all parties concerned are bound. The Board consists of:
- three independent representatives, who are permanent members;
- representatives of the trade unions and employers' organisations that are party to the particular dispute, who are temporary members; and
- representatives of the Norwegian Confederation of Trade Unions (Landsorganisasjonen i Norge, LO) and Confederation of Norwegian Business and Industry (Næringslivets Hovedorganisasjon, NHO), who are permanent members but do not have voting rights.
The fact that OLF had already concluded an agreement with the other large trade union organisation in the oil sector, the LO-affiliated Norwegian Oil and Petrochemical Workers’ Union (Norsk Olje og Petrokjemisk Fagforbund, NOPEF), was decisive in the Board’s decision in August. The dispute was brought before the Board following the breakdown of two of the three sets of parallel negotiations in the industry, which were carried out by three trade unions with similar memberships. This situation provided support for OLF's argument that an employer should not have to provide different wage systems and agreements for similar groups organised in competing unions. Thus the Board ruled that it would not be unreasonable for the two other unions (OFS and Lederne) to accept the terms laid down in the agreement reached between OLF and NOPEF. Moreover, the legitimacy of the demands at the centre of the dispute was also considered in light of bargaining developments in the rest of the economy during the 2004 bargaining. One of the disputed union claims in the oil industry was to have existing occupational pension rights enshrined in collective agreements. The board emphasised that the pension issue had been dealt with in the 'trend-setting sectors'- ie those branches setting the framework for collective bargaining in other industries - where the matter was removed from the ordinary bargaining process and referred for political consideration (NO0404101N).
OFS - which is affiliated to the Confederation of Vocational Unions (Yrkesorganisasjonenes Sentralforbund, YS) - and Lederne state that the government’s use of compulsory arbitration breaches international conventions on the freedom of association and collective bargaining, and they thus question the democratic legitimacy of the National Wage Board. Moreover, they claim that the Board's ruling in their case is biased and bears the mark of a body dominated by the interests of LO and NHO. For this reason OFS and Lederne have both chosen to 'withdraw from further participation in the National Wage Board'.
Negotiations between OLF and OFS have often resulted in compulsory arbitration being imposed (NO0210104F). OFS has thus also on previous occasions had to accept agreements that are not significantly different from those negotiated by NOPEF in the LO/NHO bargaining agreement area. However, this is the first time that trade unions have explicitly cut all ties with the National Wage Board.