- Overview: Denmark
- Global PEO and Payroll
- Global HR Compliance
- Work Permit for Hiring Expats via Global EOR
- Expand without a company set up
- Contractor vs. employee: which is better?
- Global Payroll Calculator
Global HR Compliance in Denmark
If you hire an international workforce or plan to hire, then the Hiring and Firing Workforce in Denmark Guide below will help you understand the nuances of labour legislation in the country.
When the company is planning to enter a new foreign market of Denmark and needs to employ a local national there, the first question to answer is how it will make local hires.
We have designed a Global Employer of Record service to help you outsource the global employment of your foreign workforce to companies like ours.
This solution helps you employ your global sales force in Denmark and other 190 countries, provide pay and benefits to your employees, and administer any business expenses with our help.
Our solution differs from other hiring modes in that it helps you engage your foreign workforce in full compliance with the local labour legislation. This means you are protected from non-compliance and employee misclassification risks while we bear all employment risks, not you.
So, it looks like hiring your in-house sales force in your home country. However, you focus only on your global business development while we administer your global HR. In addition, you don’t need to open your entities in foreign countries and can leverage our infrastructure in Denmark instead. With our service, you can become a global company with reduced costs and minimized time and effort.
Your employed foreign sales force will devote 100% of their time to your company product and may stay with you longer than foreign independent sales reps.
Global Employer of Record solution is 100% compliant and guarantees you and your employees full compliance with local legislation in Denmark.
We are experts in global workforce employment in Denmark, and our goal is to become your single provider. Instead of working with numerous local staffing agencies and legal advisors, Acumen International can solve your global business challenges and save you time, costs, and resources.
Our team of English-speaking professionals frees you from working through language nuances. Acumen International works 24/7 and can assist you whenever you need it, regardless of time zones. We aim to create tailored labor solutions for you managed legally and fully compliant with local employment laws.
With our knowledge and deep understanding of local nuances, you easily satisfy your need for skilled professionals in your global industry. With our qualified local partners, you can trust that your global workforce satisfies all local tax, social security, and immigration requirements in Denmark.
See the Hiring and Firing Workforce in Denmark Guide below for a general overview of labour rules and regulations in the country. Or contact us if you need to employ workers in Denmark or would like to get more details.
Hiring and Firing Workforce in Denmark Guide
With its high-income economy, Denmark is a sure place for business activities. Denmark is considered one of the least difficult and the best place to do business in. The country has a very high living standard, a highly educated and ambitious workforce, top-notch IT/ITC infrastructure and whatnot.
Acumen International is determined to help you harness the incomparable benefits of doing business in Denmark, hence has provided a workable solution that can help you easily expand your business there at an almost stress-zero level and in a compliant manner.
Before we explore how Acumen International can help you expand to and succeed in Denmark, we will first consider a few fundamental things about employment in the country.
Employment Contracts in Denmark
Employees who work a minimum of average 8 hours a week and whose employment are meant to last a minimum of one month are entitled to a written contract from their employers. For such employees, their employment contracts must be given to them within the first month of commencing work. A contract of employment must contain the main terms and conditions of an employment relationship: job description, employees position and duties, work site, official employment start/day date, daily/weekly working hours, salary and payment dates, paid leave entitlements, terms of notice of termination and relevant collective agreement.
Working Hours
The number of daily/weekly regular hours an employee may work is governed by the relevant collective agreement or individual contract in the case of the absence of a collective agreement. According to the Act regulating employment in Denmark, employees must not be allowed to work more than 48 hours on average over a four months reference period.
A normal working week runs from Monday to Friday, and office hours are usually between 8 a.m. or 8.30 a.m. and 5 p.m. Most collective bargaining agreements contain rules on working hours; the normal number of working hours is 37-37½ per week.
Probationary period in Denmark
There is no national legislation on the probationary period. Salaried workers, however, usually use up to 3 months probationary period when necessary. An employee and/or the employer have the right to end their employment relationship during the probation period. This can be done after an earlier 14 days notice has been given.
Annual Leave
Employees in Denmark have the right to observe the 12 public holidays in the country: New Year’s Day; Maundy Thursday; Good Friday; Easter; Easter Monday; Common Prayer Day; Ascension; Pentecost; Whit Monday; Boxing Day (Dec. 26). Additional holidays might be provided for by a collective agreement. Employees are entitled to 25 working days of annual paid leave accumulated in the preceding calendar years of a public holiday on a monthly basis – 2.08 days per month of service. Salaried employees are entitled to their complete regular pay while on leave, whereas hourly-paid workers are entitled to an allowance equal to 12.5 per cent of their hourly pay.
The holiday year runs from 1 May to 30 April.
Parental Leave
Female employees are entitled to 18 weeks of maternity leave, four weeks during pregnancy and 14 weeks afterwards. It is important to note that only two weeks of statutory postnatal leave is mandatory. Male employees have the right to a 2-week parental leave during the first 14 days of childbirth.
Afterwards, both parents are entitled to split 32 weeks of parental leave, which can be further extended by another 14 weeks.
According to the law, parents can receive 52 weeks of paid leave per child from the government. The amount that the parents are entitled to is less than the amount of a full salary. However, many companies are likely to have an employment agreement in place in which they pay your full salary for a period of time. Many private companies in Denmark have this kind of arrangement. In this situation, the amount paid by the government is reimbursed to the company, which in turn pays the parent’s full salary. When the employee’s right to full salary during maternity/parental leave at the company stops, the government benefits are then paid directly to the employee.
There is no prohibition against terminating the employment of a pregnant employee or an employee on leave; however, the employer is not allowed to let the pregnancy/birth influence the decision to terminate the employment. The burden of proof rests with the employer and is, in fact very difficult to satisfy. In conclusion, you should always be careful about giving notice of termination to a pregnant
employee or an employee on leave without consulting your legal advisor beforehand. An employer who cannot prove that the termination was unrelated to the pregnancy/birth will be liable to pay compensation. Such compensation will at least amount to 6-9 months’ salary, possibly a higher amount.
Sick Leave
Employees are entitled to take leave of absence when they are ill and, in some cases, can take time off when their child is sick. An employee who desires to take sick leave must inform his employer about that from the onset of sickness. Under the Danish Sickness Benefits Act, sickness benefits are paid to the employee for the first 14 days of the employee’s absence. After 14 days, the sickness benefits are paid by the local authority. This rule may not apply to blue-collar workers whose sick benefits are paid according to what is required by the collective agreement.
Overtime in Denmark
The number of overtime an employee can work, as well as the rate of compensation, is regulated by a collective agreement.
State Minimum Salary in Denmark
None; instead, negotiated between unions and employer associations, the average minimum wage for all private and public sector collective bargaining agreements was approximately DKK 110 (nominally $16) per hour, exclusive of pension benefits.
Employees can be remunerated hourly, weekly, bi-weekly or monthly. Whichever the case, an employer must pay his employees a sum that is not less than the pay rate provided by the trade union agreement.
Employment Termination in Denmark
Compared to many other jurisdictions, the Danish rules on termination of employment are relatively uncomplicated. The Salaried Employees Act normally determines the notice period, collective bargaining agreement or individual employment contract.
Salaried employees are entitled to a notice period of 1-6 months, depending on the length of employment. Sometimes, the statutory notice period has been prolonged by individual agreements. The notice periods contained in the collective bargaining agreements vary greatly but are typically shorter than those of the Salaried Employees Act.
In relation to some employees, the termination must be reasonably justified either in the employee’s conduct or the employer’s circumstances.
Unjustified terminations may cause the employer to become liable to compensate the employee. Before effecting a notice of termination, it should be clarified whether the termination will be lawful and the possible consequences of termination.
At the termination of an employment relationship, white-collar employees are entitled to cash compensation that varies depending on the service length. Employees over 30 years of age may be paid up to their three months’ salary. An employee who has worked for his employer for at least ten years can get up to his four months’ salary. An employee who has worked for at least 15 years has the right to up to his four months’ salary.
Acumen International can help you fast-track your possibilities of entering and expanding your business in Denmark by providing you with our Employer of Record services. Our unique mix of PEO/EOR solutions will enable you to jumpstart your global operations immediately, cost-effectively and compliantly without needing to set up a legal entity first or afterwards.