Certification scheme

15th of June 2010

News on a programme to tackle undeclared working from Tom Crockford.

Undeclared and untaxed work is a problem throughout Europe, but perhaps especially so in Scandinavia where social benefits are generous and taxes are high. The temptation to take unemployment support whilst working ‘on the side’ is very real. Different countries are tackling this ‘grey economy’ problem in different ways, but the Norwegian cleaning industry has introduced its own programme. It has been developed by The National Federation of Service Industries, a branch of the Confederation of Norwegian Enterprises.

Known as ‘Clean Develop-ment’ (Ren Utvikling), it is a certification scheme for companies operating in the Norwegian cleaning sector. The central feature is its emphasis on developing industry practices less prone to undeclared work. Companies participating in the Clean Development programme are required to provide documentation that their accounts and tax records are in order. The ultimate goal is for companies to be able to show their business practices are wholly legitimate.

In a business environment where a significant portion of the work carried out in the professional cleaning sector is undeclared, and has been for some time, the certification makes it possible for responsible companies to market themselves in a positive way. After all, brand image is important, even in this industry! Users of cleaning services will be able to get a list of those service providers whose activities are proven to comply with existing tax rules, and whose standards with regard to the working environment and employees' rights, are ethical. The programme is entirely voluntary.

In order to be certified, companies must have a collective agreement with the Norwegian Union of General Workers, the trade union of cleaning sector employees. Companies signing up for Clean Development must submit copies of their audit report and the board of directors report for the previous year. They also have to confirm that their annual balance of accounts has been submitted to and approved by, the government agency responsible for national data registers.

Other requirements include providing evidence from the tax collector and chief municipal treasurer, as well as a bank statement showing taxes have been deducted from the employees’ wages on behalf of the tax authorities.

In addition to the financial and tax-related paperwork that needs to be submitted, applicant companies must provide documentation concerning health, environmental and safety issues, including a list of the company’s safety officials and the annual report from the working environment committee. Full and satisfactory insurance coverage must also be shown as being in place.

These are rather demanding requirements, not to say a bureaucratic nightmare for the person responsible for paperwork. Perhaps for this reason, the percentage of Norwegian cleaning companies signing up for the Clean Development programme has been quite small. Although it has been in operation for some time already, as at the end of 2008 only 27 cleaning companies had been certified. This constitutes a small part only of the country’s cleaning sector, and it is unlikely the programme has had a significant impact on the way business is being done.

Nevertheless, for those few fully certified companies, the right to declare themselves as a ‘Clean Cleaning Company’ must be in itself somewhat rewarding.


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