Posted by on January 17, 2017 6:01 am
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Categories: Business DNB Economic globalization Economy Farmshoring Google India International business Labor Norway Offshore finance Offshoring On-demand outsourcing Outsourcing Tata

Submitted by Nick Camran of Letters from Norway

This is a personal story, discussing skilled immigration experiences and implications in both Norway and in the USA. I am a native born American of Indian origin having worked in both the US and Norwegian IT sectors. To translate the Norwegian references, you can right click in the Google Chrome browser and select “Translate to English” or use Google Translate.

Desperate to sell more fish, Norway is looking to India, allowing their IT companies increased access to the local market, in exchange for tariff reductions, which are currently high for European imports. On the surface, it appears to be a win-win deal but digging a little deeper, there are some serious long-term implications. (it still remains unclear whether or not this deal went through).

Monica Mæland: Norwegian Minister of Trade & Industry

Specifically, they want the following:

The ability to transmit and host Norwegian more personal information in India. Special areas within the company are sealed and secured, meeting Norwegian regulations. Indian IT workers can work in those zones same as a Norwegian in Trondheim or Oslo: otherwise known as a “Little Norway” zone. Since the connection is ubiquitous wit the onshore entity, they can access data containing credit card and social security numbers.

Although Mæland hopes that the Indians can make concessions on this point, they and the fishing industry are pushing hard. Geir Ove Ystmark, managing director of Seafood Norway, states that the industry is impatient.

Exemption from Norwegian Labor Laws: Tata Consulting Services (TCS), responding to an inquiry from the Labor Inspector, stated that Norwegian laws should not apply to Indian IT workers, residing onshore for short-term business trips. (If that sounds familiar, there is already a precedent from the US almost ten years ago.) Tata further argues that the workers are really employed in India, visiting Norway for a maximum of four to five months.

After the Vipps scandal at DnB (The Norwegian Bank) last year, involving the development of a now popular payment app, the labor directorate decisively denied the request. Against the hallmark Norwegian labor laws, the workers were putting in almost 16 hours per day to complete the project. I personally heard rumors, talking to TCS guys on the metro in Oslo, that they were not allowed to leave the office without their manager’s permission, even for a bathroom break or a movie over te weekend.

NRK (Translated from Norwegian)

Despite the reprimand, given to Tata, ordering them to correct the situation, Lise Raneberg of the Tekna engineering union, believes that they will exploit loopholes to circumvent the law. Nevertheless, Rina Sunder, from Innovation Forum Norway, believes, “Norway should meet India’s demand for easier access for IT workers.”


The initial justification behind outsourcing and offshoring is that there is a skilled labor shortage in software and systems engineering. Generally technical, medical and engineering sectors experience shortages, requiring companies to hire offshore workers or companies, on contract, to fill the void. However, companies quickly realized that they could also save money, paying foreign workers much less than their domestic counterparts.


There are two models:

  • Outsourcing: sending work to another company, working under contract, to deliver a service. This can be both done within the domestic market like having a local consultant teach a course or do a short term project.
  • Offshoring: sending the work abroad either within your own company or outsourcing it to another company.

Offshoring and outsourcing even became a business goal with many companies, in and out of the sector. Target “offshore/onshore” ratios, vary from 40%-60%. In both cases, on location business trips or extended assignments may be required to complete work, allowing them systems access that they could not reach offsite. Often it becomes difficult to distinguish between an extended assignment, covered under local labor laws, and business trips, which are often extended or repeated in close succession. (Business trip visas can repeatedly be extended, or the laborer returns home every couple of months for a week or two before returning on a new visa.) They can even rotate people on and offshore, ducking the laws.

(Next – Part II: The Workers Perspective)

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