Terms of employment

New to the Danish labour market?

Have you just arrived in Denmark? Or perhaps you’re starting out in your first job? If you are new to the Danish labour market, it is a good idea to become acquainted with work life in Denmark, including contracts, salary negotiations, dismissals and resignations, the social ground rules and much more.

Du you need a contract review?

Send us your contract for a professional assessment of the terms prior to negotiation with your future employer. Make sure to provide your phone number, so we can contact you if you would like the feedback by phone. And please indicate if there are any items in the contract we should be particularly aware of.

Send us an e-mail (Djøf members only)

Salary

In Denmark, you generally negotiate your own salary if you are employed in the private sector. However, part of the private sector is regulated by private-sector collective agreements concerning salary levels and terms of employment.  As a private-sector employee, your salary will be a gross salary including pension.

Salaries in the public sector are regulated by collective agreements, with Djøf members generally covered by the AC collective agreement (negotiated by Akademikerne – Danish Confederation of Professional Organisations). The salary is a net salary to which is added approx. 17.1-18.3% in pension.

You will typically negotiate your salary once a year. Use our salary calculator to get an idea of your market value in Denmark

Salary benchmarking

As a member of Djøf, you have access to statistics and calculations for the average salaries of our members. This gives you a benchmark for the average salary in a specific position based on your information regarding education, seniority, job title, industry and geography. Djøf’s salary calculator is based on annual reports by members working in the private-sector and salary statistics from the public sector.

The salary calculator’s results for the private sector are an indication of gross salary including pension, while the salary calculator’s results for the public sector show the net salary to which pension is added in accordance with the applicable collective agreement.

Please note that the salary calculator also shows other terms of employment which typically apply to a specific position, such as performance-based salary and restrictive covenants. It also provides an overview of the employee benefits typically associated with the position.

Djøf members are welcome to contact us to talk about your salary negotiation options. See contact options below.

Bonus

If you have an agreement on bonus, section 17a of the Danish Salaried Employees Act guarantees that upon your resignation, you are entitled to a proportional share of the payment you would have received if you had continued to work for that employer until the time of disbursement. Thus, you retain your entitlement to an already earned bonus should you leave the employer.

Pension

Your employer is not obliged to make pension payments unless previously agreed. If you are offered a pension scheme, your employer generally pays at least two-thirds of the agreed percentage rate of your salary, while you pay one-third.

Djøf recommends paying 16-18% of your salary to a pension scheme.

Salaried employee status

The vast majority of Djøf members hold salaried employee positions. In Denmark, a salaried employee primarily works in the business and office sector, in a warehouse position, or provides technical or clinical assistance services. An employee must have been employed on average for more than 8 hours a week to be covered by the Salaried Employee Act.

With salaried employee status, an employee acquires certain entitlements in relation to his or her employer, such as a fixed notice period in connection with resignation, a reasoned explanation for dismissal and salary during sickness.

It is not possible to agree to deviate from the Salaried Employees Act or to deny an employee their rights as a salaried employee.

Working hours

The standard work week in Denmark is 37 hours. However, many of our members generally work longer than that, and the actual work week for Djøf members is 42 hours a week. If it is important to you that you work no more than 37 hours a week, this must be clearly stated in your contract.

Your working hours may not exceed 48 hours on average per week over a four-month period. You are entitled to 11 hours of rest within a 24-hour period, and you are entitled to one full day (24 hours) off a week.

If you are to be paid overtime or have the option of taking time off in lieu, it must be stated in your contract.

Student jobs

If you are employed for more than 8 hours a week in your student job and you are a salaried employee, you have certain special rights. For example, a period of notice depending on your seniority, a right to a reasoned explanation for your dismissal and salary during sickness.

The new Holiday Act

Are you up-to-date on the changes to The Holiday Act? No? Then keep reading. A warning before you do, it gets pretty technical, but stick with it. You’ll be glad you did.

In Denmark, it has long been standard practice that the days off employees earned during one calendar year were used during the following ‘holiday year’ (starting the 1st of May and ending on the 30th of April). Changes to the Danish Holiday Act that came into effect on the 1st of September 2020 mean a new way of earning and using days off. 

Instead of earning days off during one period and then using them in another, under the new system you can use your days off as you earn them. 

A transitional period began on the 1st of January 2019. The most important details are:

• during the first eight months of 2019, employees earned 16.7 days off that could be used during the period of the 1^st of May 2020 till the 31^st of August 2020, the final day before we transitioned to the new system
• As a result unused holiday pay was originally intended to be banked up and paid out when you retire or stop working in Denmark.
• However, due to the corona situation the Danish Government has made it possible that your holiday allowance can be claimed by the 1^st of October 2020.
• For more information read the article 'Claim your banked holiday allowance early'

The changes to the Holiday Act are the result of an EU directive requiring Denmark to be more accommodating of people entering the job market. Under the previous rules, recent graduates (or other newcomers to the Danish labour market) could find themselves in a situation in which they had to wait a full 16 months before they could take paid days off.

The 1^st September 2020 and onwards

Once the law was fully implemented in 2020, the holiday year runs from the 1st of September to the 31st of August. During a given holiday year, employees will continue to earn the right to 25 paid days off, as they used to. 

You will be able to use your days off during the period of the 1st of September till the 31st of December of the following year. This means that you have 16 months, known as the holiday period, to use the days off you earn in a single year. The longer period gives employees a greater degree of flexibility when planning their time off. 

Many people get more than the minimum of 25 days mandated by the Holiday Act. Different workplaces call this extra time off by different names: floating holidays, the sixth holiday week or something different. These extra days are not, and have never been, regulated by the Holiday Act. Any rules for how these additional days off are to be held are agreed on during collective bargaining or by individual agreement with employers. For that reason, the description below applies only to the days off guaranteed by the Holiday Act. 

From consecutive to concurrent

In at least one respect the new Holiday Act is like the previous one: you earn 2.08 days off per month of work. What’s new is that after  the new act has come into effect you can take those days off as soon as you earn them.

From the  1st of September 2020, you earned your first 2.08 days off as soon as you started working. From there on you keep adding 2.08 days for every month you work. Doing it this way means that most people will need to rethink how they plan their holidays, especially if you’d like to take time off at the start of the holiday period, and you haven’t earned enough days off yet.

If you’d like to take time off even though you haven’t earned enough days off, you can ask your manager if you can borrow from what you will earn from the rest of the holiday year  and then pay those back  during the holiday year.

If you choose to do it that way, you will pay back what you owe with the 2.08 days off you earn each month.

One thing to be aware of: you can’t borrow more days than you can earn  the right to during the rest of the holiday year. And, if you resign before you have paid back the days you have borrowed  your employer will deduct the value of the days you owe from your final month’s pay. 

The short holiday year in 2020

Between the 1st of January 2019  and the 1st of September 2020 there were some transitional rules that facilitated the changeover to the new system:

• in 2020 the holiday year was shorter than usual, and lasted from the 1st of May 2020 until the 31st of August 2020.
• during the short holiday year, employees were able to take 16.68 days off. These days have been earned from January 2019 till August 2019.
• days off earned between the 1st of September 2019 and the 31st of August 2020 has been paid into a newly established fund (Lønmodtagernes Feriemidler (LD) (See ld.dk/English)). These days will be paid out when you withdraw from the Danish labour market or if you claim a part of your holiday allowance due to the corona situation.    

Banked days off

You haven’t lost any money as a result of the changeover to the new Holiday Act. 

During the period of 1st of September 2019 till the 31st of August 2020, your employer calculated what the value of your earned days off amounted to. You have two options: Either you can receive the  money when you retire or stop working in Denmark, or you can decide to claim a part of your holiday allowance due to the corona situation.

The reason for banking the value of your days off is that you will have earned the right to days off in a holiday year that never happened, due to the change over to the new system.

Your banked days off will be administered by Lønmodtagernes Feriemidler (LD), a fund that will be responsible for managing the banked funds and for ensuring they are profitably invested. Your money will be paid out to you when you withdraw from the Danish labour market. Your employer needs to notify the LD of the amount you are owed, but can wait to deposit that amount for as long as you remain working. 

Whether your employer deposits the money immediately or chooses to wait has no consequence for you. If the LD has been notified of the amount you are owed, you will receive your money when you stop working even if your employer cannot – or will not – deposit the money. 

The value of your banked days off will be regulated annually, regardless of whether your employer has deposited the money. The amount is regulated at the same rate for all employees. 

Your employer has until the 31st of December 2020 to notify the LD of the value of the days off to be banked. The LD will then notify you of the amount. More information about holiday allowance and frozen holiday funds is  available at Life in Denmark. 

Still have questions about the new rules? Give us a ring on 33 95 97 00.

Sickness

Illness

As a salaried employee you’re entitled to time off with full pay when you’re ill, regardless of how long you’ve been employed or how long you’re ill.

If you can’t go to work because you’ve become ill, you need to call in on the first workday you are out.

Once you’ve told your employer that you are ill, you don’t need to provide updates about your situation. That said, people normally do give their employer an idea of when they might be back at work again, if they can.

You are not entitled to paid time off to care for an ill child unless it is stated in your contract or the company handbook, or you have some other prior agreement with your employer.

Parental leave

You are covered by the regulations set out in the Danish Salaried Employees Act and the Act on Entitlement to Leave and Benefits in the Event of Childbirth unless otherwise agreed with your employer.

As a mother, you are entitled to four weeks leave prior to the expected date of childbirth and 14 weeks leave after the birth of your child. During this leave of absence, you are entitled to 50% of your salary.

As a father, you are entitled to two weeks leave in connection with the birth of your child. During this leave of absence, you are entitled to parental leave benefits.

Both parents are entitled to an additional 32 weeks of leave from the 15th week after childbirth. However, there is only one pool of parental leave benefits for 32 weeks which you, as the parents, must share between you. 

Most members of Djøf now have an agreement that includes better benefits in connection with childbirth. Typically, both parents are given full pay over a set period of time. You can read more about your rights to parental leave here

Dismissals and resignations

If you are given notice, as a salaried employee, you are entitled to a reasoned explanation for your dismissal from your employer. If the dismissal is unfair, you have the option to make a claim for compensation. However, you must have been employed for at least one year at the time of dismissal before it is possible to claim compensation.

Whether your dismissal is deemed unfair depends on a specific assessment. Djøf can help you with this assessment.

According to the Salaried Employees Act, an employee must give one month’s notice of resignation at the end of a month.

The employer’s term of notice varies depending on how long you have been employed according to the following model, as stated in the Salaried Employees Act:

• Before the end of 5 months’ employment, the employee must be given 1 month’s notice.
• Before the end of 2 years and 9 months’ employment, the employee must be given 3 months’ notice.
• Before the end of 5 years and 8 months’ employment, the employee must be given 4 months’ notice.
• Before the end of 8 years and 7 months’ employment, the employee must be given 5 months’ notice.
• After this time, the employee must be given 6 months’ notice.

When you are appointed to a position, a probationary period is generally agreed upon (section 2(5) of the Salaried Employees Act). Your employer may give you 14 days’ notice of dismissal during the first 3 months of your employment. A probationary period clause is currently included in the majority of our members’ contracts.

If you become sick over an extended period of time, you need to be aware of section 5(2) of the Salaried Employees Act:

If you have been sick for 120 days within the past 12 months, it may have been agreed that you can be dismissed with 1 month’s notice. However, for this to apply, you must be sick at the time of the dismissal and the dismissal must take place immediately following the end of the 120 days of sickness.

Customer and non-competition clauses

A competition clause is an agreement between you and your employer that you may not seek employment or hold interests in a competing enterprise after your resignation.

A customer clause is an agreement between you and your employer that you may not have a business connection with your employer’s customers and/or other business connections after your resignation.

A clause therefore limits your mobility in the labour market. Before a clause is valid, it must meet certain legal conditions regarding maximum duration, financial compensation etc.

We encourage you to contact Djøf before accepting any clause of this nature.