Employment 2026 Comparisons

The Danish labour market is very well functioning and characterised by high employment, a highly skilled and well-educated workforce, flexible hiring and dismissal rules with an expedient system for resolving labour disputes. The Danish flexicurity model combines employer flexibility with employee protection, unemployment benefits, and active labour market policies supported by government. Denmark has a high degree of unionisation, and Collective Bargaining Agreements covering large parts of the Labour Market predominantly for blue-collar workers where white-collar workers are predominantly regulated by statutory legislation combined with individually agreed terms.

The Danish labour law is, to a large extent, based on a distinction between different subgroups, with the primary differentiation being between blue- and white-collar workers. This distinction is based on the type of work performed, and is relevant in determining the legal framework governing the employment relationship.

White-Collar Workers

In Denmark, the legal definition of a white-collar (salaried) worker is found in Section 1 of the Danish Salaried Employees Act. According to the Act, white-collar workers are:

• office workers and shop assistants employed in office work, buying and selling activities, or equivalent warehouse operations;
• individuals whose work involves technical or clinical services (except handicraft or factory work) or comparable work functions;
• individuals whose work wholly or mainly involves managing or supervising the work of others on behalf of an employer; and
• individuals whose work predominantly consists of the work described in the first two points.

Furthermore, the Danish Salaried Employees Act applies only to employees who have been continuously employed for more than one month, work on average more than eight hours per week, and perform their work under the direction and control of the employer.

Employees covered by the Danish Salaried Employees Act are afforded a number of statutory minimum protections, including in relation to notice periods, severance payments, unfair dismissal, sick pay, maternity pay and probationary periods.

Blue-Collar Workers

In contrast, blue-collar work is characterised by performing physical work or requiring manual skill rather than office-based work.

Blue-collar workers are not covered by the Danish Salaried Employees Act. Instead, their employment terms and conditions are mainly regulated through collective bargaining agreements.

Employment relationships in Denmark may be concluded for either an indefinite or a fixed term. Indefinite-term employment constitutes the ordinary form of employment. Fixed-term employment is permitted, provided that the duration of the employment is determined on the basis of objective criteria, such as a specified date, the completion of a specific task or the occurrence of a particular event. Fixed-term contracts may be renewed or extended only where objectively justified.

Employers must provide employees working more than an average of three hours per week over a four-week reference period with written information on all material terms and conditions of employment. The same applies where no guaranteed amount of paid work has been determined before the commencement of employment (ie, primarily employees on on-call duty under so-called “zero-hours contracts”).

The employer must provide certain information no later than seven calendar days after commencement of employment, while the remaining mandatory information must generally be provided within one month. The required information includes, among other things:

• the identity of the parties;
• the place of work;
• the employee’s position or duties;
• the commencement date;
• the expected duration of any fixed-term employment;
• any probationary period;
• remuneration;
• working hours;
• paid leave;
• notice periods;
• employer-provided training;
• information regarding social security contributions; and
• any applicable collective bargaining agreement.

The statutory requirements are not exhaustive. Employers must also provide written information on any other material terms of employment, where relevant.

Some collective bargaining agreements specify the use of mandatory employment contracts also referencing material employment terms in the applicable collective bargaining agreement.

Special formal requirements apply to vocational training agreements, which must be concluded in writing and signed on an approved standard form.

Maximum Working Hours

In Denmark, working hours are regulated by the EU Working Time Directive, Danish legislation on working environment and working time, and collective bargaining agreements. An employee’s average working time must not exceed 48 hours per week, measured over a four-month reference period, although collective bargaining agreements may contain more detailed rules on the organisation of working hours.

Since 1 July 2024, employers have been required to implement a system enabling employees to register their daily working hours in accordance with the Danish Working Time Act. Employers may choose the method of registration, provided the system is objective, reliable and accessible. The requirement aims to ensure compliance with rest time rules and the 48-hour weekly limit. Limited exceptions apply to employees with a high degree of independence.

The Act also allows a limited opt-out from the 48-hour rule for certain employees covered by collective bargaining agreements on on-call duty who perform socially critical functions. Even where an opt-out applies, the average weekly working time may not exceed 60 hours over a four-month reference period.

Flexible Arrangements

Flexible working arrangements are generally permissible in Denmark but must, in all circumstances, comply with Danish legislation on the working environment and working hours, as well as any relevant provisions in collective agreements.

Part-Time Work

According to an appendix to the Danish Part-Time Employees Act, a part-time employee is an employee who works fewer normal hours than a comparable full-time employee, measured on a weekly basis or as an average over an employment period of up to one year.

As regards contracts for part-time employees, the same general requirements concerning the content of the employment contract apply as described in 1.2 Employment Contracts. As to working hours, the employer must specify the employee’s normal daily or weekly working hours, including, where applicable, arrangements for overtime and overtime pay, as well as arrangements for shift changes.

Furthermore, the Danish Part-Time Employees Act prohibits employers from offering less favourable working conditions to part-time employees compared to similar full-time employees, unless the difference in conditions is justified on objective grounds.

Temporary Workers

In Denmark, temporary workers may be employed either directly by the company in need of the workforce or with a third party (ie, a temporary work agency). If the temporary worker enters into a contract with a staffing agency to then be allocated to a company (user company), the agreement is governed by the Danish Act on Temporary Agency Workers.

Temporary workers are generally entitled to the same essential working and employment conditions as if employed directly by the user company. However, recent Labour Court rulings have clarified the scope for derogating from this equal treatment principle through collective agreements. The Labour Court has held that the equal treatment principle may only be derogated from by collective agreement if the temporary agency worker is provided with compensating benefits that offset any less favourable terms compared to employees hired directly by the user company.

Overtime Regulation

In Denmark, there are no statutory rules regarding compensation for overtime. However, compensation for overtime may be stipulated in either the employment contract, a collective bargaining agreement, or an employee handbook. The compensation may consist of overtime pay or time off in lieu. 

Collective bargaining agreements typically specify rules on compensation for overtime, whereas many salaried employees covered by the Danish Salaried Employees Act are not compensated for overtime. 

Violation of the 48-hour rule may entitle the employee to compensation. According to a Danish Supreme Court case, the base compensation is DKK25,000 per employee but may be increased in aggravating circumstances, such as the employer’s intent to exceed the 48-hour limit or where a high number of employees exceed the maximum working hours.

Minimum Wage Requirement

There is no statutory minimum wage in Denmark. However, most collective bargaining agreements stipulate minimum wages.

Bonuses and 13th-Month Salary

There is no statutory requirement to pay a 13th-month salary or bonuses in Denmark. However, it is customary that some employees are covered by bonuses or other incentive programmes – eg, employees in sales and management positions.   

Government Intervention

There is generally no government intervention in determining compensation or salary increases in Denmark. Salary levels and increases are generally determined through collective bargaining agreements, local salary negotiations or individual agreements between the employer and the employee.

Vacation and Vacation Pay

Employees are entitled to 25 days of annual holiday under the Danish Holiday Act. Holiday accrues at a rate of 2.08 days per month of employment, and the holiday year runs from 1 September to 31 August. Accrued holiday may generally be taken during a 16-month holiday period ending 31 December.

Monthly-paid and other long-term employees generally receive their usual salary during holiday together with a statutory holiday supplement of 1% of salary, unless a higher supplement has been agreed. Other employees are entitled to a holiday allowance equal to 12.5% of their salary, which is paid into FerieKonto and may generally be claimed when holiday is taken.

Employees may generally, if agreed with the employer, carry over up to five unused holiday days from each holiday period to the following holiday period. Where an employee is prevented from taking holiday due to a holiday obstacle, such as maternity leave, additional holiday may be carried forward. Collective bargaining agreements may also regulate the transfer of unused holiday.

Statutory Leave

Employees are entitled to a range of statutory leave rights, including sickness leave, maternity, paternity, parental and adoption leave, caregiver leave, bereavement leave, military leave, jury service leave and leave in force majeure situations.

Salaried employees are generally entitled to full salary during sickness, whereas other employees may receive statutory sick pay if the applicable qualifying conditions are met, or be entitled to sick pay according to an applicable collective bargaining agreement. Employers may request medical documentation of the sickness and generally bear the associated costs.

Employees are also entitled to leave in connection with the birth or adoption of a child. While employees are generally entitled to public maternity benefits during the statutory leave periods, entitlement to salary during maternity, paternity, parental or adoption leave depends on the applicable legislation, the employment contract, a collective bargaining agreement or an employee handbook.

Certain statutory leave entitlements, including caregiver leave and leave in force majeure situations, are generally unpaid unless otherwise agreed.

Confidentiality

Under the Danish Trade Secrets Act, employees are prohibited from misusing their employer’s trade secrets, both during their employment and after the termination of the employment relationship. It is common for the employee’s duty of confidentiality to be set out in more detail in the employment agreement.

Duty of Loyalty

Employees owe a duty of loyalty towards their employer throughout the employment relationship. For example, employees are not permitted to engage in activities of a competitive nature or speak disparagingly about their employer. Conduct that breaches this duty may constitute fair grounds for dismissal or even summary dismissal, depending on the circumstances. 

The duty of loyalty continues throughout the notice period including a period of garden leave.

Employee Liability

Employers are generally liable for the errors and negligence of their employees. Compensation which an employer has had to pay as a result of an employee’s negligent conduct may only be recovered from the employee to the extent that this is reasonable, taking into account the degree of fault, the employee’s position and the circumstances in general. Furthermore, the employee is not liable for damages if the loss is covered by property insurance, business interruption insurance or the employer’s liability insurance, unless the employee caused the loss intentionally or through gross negligence.

Non-Compete Clauses

Under the Danish Employment Clauses Act, a non-compete clause is an agreement between an employer and an employee that restricts the employee, after termination of employment, from carrying on a competing business or accepting employment with a competing business.

The Act’s specific provision of invalidity in situations where an employee has not given cause for the employer’s termination also applies to non-employees such as directors, owners and external consultants.

Requirements for Validity

A non-compete clause is valid only if the statutory requirements are met. The employee must hold a particularly trusted position or have concluded an agreement with the employer regarding the rights to exploit an invention made by the employee. The employer must also provide the employee, in writing, with the reasons why a non-compete clause is required. In addition, the employee must have been continuously employed for at least six months, the clause must provide for compensation during the restricted period, and its duration may not exceed 12 months (six months if combined non-compete and solicitation) following termination of employment. Finally, the employee must receive all required information about the clause in writing, which is typically done as part of the employment agreement.

Compensation

As to compensation, Danish law requires the employee to receive compensation for the period during which the non-compete clause applies. The agreement must therefore include a provision on compensation. For non-compete clauses lasting up to six months, the employee is entitled to compensation of at least 40% of their monthly salary (60% if combined non-compete and solicitation). For clauses lasting more than six months (up to a maximum of 12 months), the compensation must be at least 60% of the employee’s monthly salary. If the employee obtains other suitable employment, the ongoing compensation may be reduced in accordance with the Danish Employment Clauses Act. The compensation payable for the first two months must be paid as a lump sum upon termination.

A non-compete clause that does not satisfy the statutory requirements is not binding on the employee. In addition, an overly broad clause may be found unreasonable and declared unenforceable under section 36 of the Danish Contracts Act.

Non-Solicitation Clauses

Under the Danish Employment Clauses Act, a non-solicitation clause is an agreement between an employer and an employee under which, following the termination of employment, the employee may not accept employment with or otherwise, directly or indirectly, maintain a business relationship with the employer’s customers or other business relations.

Requirements for Validity

A non-solicitation clause is valid only if the statutory requirements are met. The clause may cover only those customers with whom the employee has had a business relationship during the 12 months preceding the notice of termination. In addition, the employee must have been continuously employed for at least six months, the clause must provide for compensation during the restricted period, and its duration may not exceed 12 months (six months if combined non-compete and solicitation) following termination of employment. The employee must also receive the required information about the clause in writing, typically as part of the employment agreement.

Compensation

Mandatory minimum compensation for non-solicitation clauses is the same as for non-compete clauses. Please refer to section 2.1 Non-Competes.

Customer List

Upon termination of employment, whether initiated by the employer or the employee, the employer must provide the employee with a list identifying the customers covered by the clause. The employer is responsible for preparing the list, while the employee is required to cooperate in ensuring that it accurately reflects the customers with whom the employee had a business relationship during the employment.

With respect to customers, a non-solicitation clause may therefore only apply to customers with whom the employee had an actual business relationship during the 12 months preceding the termination of employment. This requirement reflects the purpose of a non-solicitation clause, which is to prevent an employee from taking the employer’s customers after termination rather than restricting the employee’s ability to compete generally.

Legislation 

The processing of personal data in the employment context is primarily governed by the General Data Protection Regulation (Regulation (EU) 2016/679) (“GDPR”) and the Danish Data Protection Act. In addition, the Danish Act on the Use of Health Information in the Labour Market applies to the processing of employees’ health information in the employment context.

Data Protection Requirements

Employers are considered to be data controllers and processing of personal data relating to employees or job applicants must comply with the general data protection principles set out in Article 5 of the GDPR, including the principles of lawfulness, fairness and transparency, purpose limitation, data minimisation, accuracy, storage limitation, and integrity and confidentiality. In addition, the employer must identify a valid legal basis for the processing under Article 6 of the GDPR and, where applicable, Article 9 of the GDPR for the processing of special categories of personal data.

Employee and Applicant Rights

Employees and job applicants are entitled to the rights provided under the GDPR, including the rights to information, access, rectification, erasure, restriction of processing, data portability, objection, and protection against certain automated decision-making.

Employers may transfer employees’ personal data within Denmark and internationally, provided the applicable requirements under the GDPR are satisfied. Transfers to countries outside the European Union require an appropriate transfer mechanism under Chapter V of the GDPR, unless the recipient country benefits from an adequacy decision issued by the European Commission.

Enforcement and Data Breaches

Failure to comply with the applicable data protection rules may result in administrative fines and liability for damages under the GDPR and the Danish Data Protection Act. Fines may be imposed up to EUR20 million or 4% of the global turnover. In Denmark, fines have ranged from DKK50,000 to DKK1,500,000. In the event of a personal data breach, employers may be required to notify both the Danish Data Protection Agency and the affected employees in accordance with the GDPR.

EU/EEA and Nordic Nationals

As a general rule, Nordic nationals and nationals of EU/EEA Member States may work in Denmark without a work permit. However, EU/EEA nationals who intend to stay in Denmark for more than three months (or six months if seeking employment) must obtain an EU Registration Certificate.

Third-Country Nationals

Third-country nationals must generally obtain a valid work and residence permit before commencing employment in Denmark. Such permits may be granted under various immigration schemes, including the Fast Track Scheme, the Pay Limit Scheme, the Supplementary Pay Limit Scheme, and the Positive List Scheme, provided that the applicable statutory requirements are met.

Social Dumping and Construction Site Inspections 

The use of foreign workers and service providers is subject to increased regulatory attention in Denmark, particularly in construction and major infrastructure projects. Key compliance issues include RUT registration, pay and working time documentation, and compliance requirements throughout the supply chain.

A bill introducing mandatory ID cards on construction sites was submitted on 25 June 2026 and is scheduled for its first parliamentary reading on 14 August 2026. The proposed scheme is intended to strengthen authorities’ monitoring of compliance with labour market rules, and would require workers on covered projects to carry ID cards and register time spent on site.

EU/EEA nationals staying in Denmark for more than three months (or six months if seeking employment) must apply for an EU Registration Certificate with the Danish Agency for International Recruitment and Integration (SIRI).

Third-country nationals must obtain the relevant work and residence permit from SIRI before commencing employment. The applicable application and registration requirements depend on the immigration scheme under which the application is submitted. If an employee changes job, a new application for work and residence must be submitted. Depending on the circumstances, the employee may or may not commence work before the new permits have been granted.

Remote and Home Working

There is no general statutory entitlement to work remotely in Denmark. Mobile and home working arrangements will therefore usually depend on an agreement with the employer or the employer’s internal policies. Material changes to agreed terms regarding the place or organisation of work may need to be implemented in accordance with the rules applicable to material changes to employment terms.

Occupational Health and Safety

The employer’s responsibility for a safe and healthy working environment also applies when employees work from home. Depending on the extent of remote work, the employer may be required to provide appropriate equipment for the home workstation. Remote working must also be considered as part of the employer’s workplace assessment (APV), which covers physical, psychological and social working environment risks. Furthermore, employers are liable for work-related injuries that occur in employees’ homes. In a Supreme Court judgment of 2 May 2025, an employee who was injured while returning from her kitchen to her home workstation was covered by the employer’s occupational injury insurance.

Data Privacy

The GDPR applies to the processing of employee personal data regardless of where the employee works. Employers must therefore ensure continued compliance with applicable data protection requirements when employees work remotely. Employers commonly regulate remote working and the use of internet and email through internal policies, including how employees access and handle information outside the workplace.

Cross-Border Remote Work and Social Security

Working remotely from another country may affect social security coverage and may also have employment law, tax and immigration implications. Employees working abroad on a short-term basis may remain covered by Danish social security, whereas longer-term or permanent arrangements may result in a different position. Work in another EU country may also trigger rules applicable to posted workers. Employers should therefore assess the implications before approving regular cross-border remote work, particularly where work is performed outside the EU/EEA.

Voluntary Leave

Apart from the statutory right to leave mentioned in 1.5 Other Employment Terms, Danish employees do not generally have a statutory right to take a sabbatical for personal reasons. In the private sector, such leave will typically require the employer’s consent, unless an entitlement follows from the employment contract, a collective bargaining agreement or applicable workplace rules. The parties are generally free to determine the length and conditions of an agreed sabbatical. Leave will normally be unpaid unless the employee is entitled to continued pay under the applicable contractual or collective terms.

Platform Work

Platform and gig work is developing beyond traditional delivery and transport services and may include freelance platforms, digital staffing solutions and other forms of on-demand work. Under Danish employment law, an important question is whether the individual should be regarded as an employee or as a self-employed contractor. The assessment is based on the actual circumstances of the working relationship and not only how the parties have described the relationship in the contract.

The EU Platform Work Directive also introduces rules concerning employment status and the use of automated monitoring and decision-making systems in platform work. These rules include requirements concerning transparency and human involvement in certain decisions affecting individuals performing platform work.

Flexible Workplace Models

Hybrid working has also resulted in more flexible use of the physical workplace. This includes desk sharing and other workplace models where employees do not have permanently assigned workstations.

Employers remain responsible for ensuring compliance with applicable occupational health and safety requirements when introducing such arrangements. Employers should also consider whether changes to established working arrangements constitute material changes to the employees’ terms and conditions of employment, in which case the changes may need to be implemented with the employees’ applicable notice period.

Role of Trade Unions

Trade unions play a central role in the Danish labour market. Union membership is common, and the Danish labour market model is largely based on collective agreements between trade unions and employers’ organisations. As a result, many terms and conditions of employment, including wages, working time and overtime, are regulated through collective agreements rather than legislation.

Trade Union Rights and Activities

Trade unions negotiate collective agreements, represent employees in employment-related matters and assist members in disputes with employers. They also play an important role in enforcing collective agreements and may initiate industrial action in accordance with Danish labour law and the applicable collective agreements with the aim of obtaining a collective bargaining agreement with an employer. Employees are free to join or not join a trade union, and employers may not discriminate against employees on the basis of trade union membership or activities.

Employee Representative Bodies

Employee representative bodies in Denmark include works councils and shop stewards. There is no general statutory requirement to establish a works council. However, for many employers, the obligation follows from the applicable collective agreement, including the Cooperation Agreement between the Danish Trade Union Confederation (FH) and the Confederation of Danish Employers (DA). Under the Cooperation Agreement, a works council must be established if the company employs at least 35 employees and either management or the employees request it.

Works Councils

A works council consists of an equal number of representatives from management and the employees. The employee representatives are elected by the employees. The works council is consulted and informed on matters concerning the operation of the business, including employment conditions and significant organisational changes.

Shop Stewards

Collective agreements also commonly provide for the election of shop stewards. Shop stewards represent the employees at the workplace and act as the link between the employees, the employer and the relevant trade union. They also negotiate local agreements within the framework of the applicable collective agreement.

Collective bargaining agreements play a central role in the Danish labour market. They are concluded between trade unions and employers’ organisations or individual employers and regulate key terms and conditions of employment, including wages, working time, overtime, pensions and other employment-related matters.

There is no general obligation for employers to enter into a collective bargaining agreement. However, employers that are party to a collective bargaining agreement are bound by its terms. Employees covered by the agreement are entitled to the rights and benefits provided therein regardless of whether they are members of the trade union that concluded the agreement, unless otherwise provided.

Collective bargaining agreements may also regulate matters such as shop stewards, cooperation committees, local agreements, information and consultation obligations, and dispute resolution procedures.

Grounds for Dismissal

The Danish Salaried Employees Act contains extensive regulation on the dismissal of employees. In terms of grounds, the Act stipulates that the dismissal of a salaried employee who have been employed with the company for at least one year (12 months) must be fairly justified. A dismissal may be based on circumstances of the salaried employee, such as poor performance, or circumstances of the company, such as restructuring or cost reductions. In cases concerning an employee’s performance or conduct, a prior warning must, as a general rule, be given first, depending on the circumstances. A warning should give the employee an opportunity to correct the relevant conduct or improve their performance before a dismissal is considered.

As to collective bargaining agreements, dismissals are often regulated in detail, including the definition of permissible grounds for dismissals. Several collective bargaining agreements set out that dismissals must be fairly justified by the conduct of the employee or the circumstances of the company. The prohibition of unfair dismissals is usually only applicable to employees of a certain seniority with the employer. The required seniority depends on the specific collective bargaining agreement the employee is subject to.

In addition, legislation on Anti-Discrimination protects all employees against dismissal (see 8.2 Anti-Discrimination).

As a main rule, the employer is not required to inform the employee of the grounds for dismissal. However, according to the Danish Salaried Employees Act, employees are entitled to be informed in writing of the reason for dismissal upon request to the employer.

In addition, collective bargaining agreements generally also stipulate that employees with a certain seniority are entitled to a more detailed explanation of the reason for dismissal.

Despite the above, it is customary for employers to inform the employees of the grounds for dismissal.

Termination Procedures

There is no general requirement for a notice of termination to be given in writing. For salaried employees covered by the Danish Salaried Employees Act, however, notice must be given in writing. In practice, employers generally give notice in writing in order to document the dismissal.

When terminating salaried employees covered by the Danish Salaried Employees Act there are no general procedural requirements of consultation prior to giving a notice of termination.

Collective bargaining agreements may contain additional procedural requirements. For example, an employer may be required to inform the relevant employee representative of an intended dismissal. Special procedural requirements also apply to public-sector employees, including requirements to consult the employee before a final decision on dismissal is made.

Collective redundancies are subject to a separate procedure. 

Collective Redundancies

Different rules apply with regard to collective redundancies. The rules on collective redundancies are stipulated in the Danish Mass Redundancy Act.

Triggering event

If the following criteria are met, the Danish Mass Redundancy Act will apply on intended terminations of employees:

• the employees are dismissed for reasons to which they are not to blame; and
• the number of affected employees within a period of 30 days is:
1. 10 or more if the employer employs between 20 to 99 employees;
2. 10% or more if the employer employs between 100 to 299 employees; or
3. 30 or more if the employer employs 300 or more employees.

Provided the Danish Mass Redundancy Act applies, the employer must follow the procedure set out below. The procedure covers both before and during the dismissals.

• Duty to negotiate.
1. The employer must at the earliest convenience commence negotiations with the employees or their representatives to examine whether collective redundancies can be avoided by restructuring or relocation of the employees. There are no requirements for the duration of the negotiations; however, the employees must have the opportunity to present their input.
2. Prior to the negotiations, the employer must provide the employees or their representatives with all relevant documentation and information, including, but not limited to, the reason for the mass redundancy, the number of employees who may be terminated, the selection criteria, the possible severance payments, etc. Note that the selection criteria must be objective and legal – eg, based on seniority, earlier warnings given, education, etc.
• Provision of information to the regional labour market council. Generally, an employer must provide the Regional Labour Market Council (“the Council”) with specific information (three different letters). The information in the three letters must be given at specific times, as follows.

1. First letter – when the employer provides the employees or their representatives with documentation and information, the employer must also forward the information to the Council.
2. Second letter – if the employer intends to continue with the dismissals after the negotiations have been completed, the employer forwards a written letter containing all information of relevance to the Council as soon as the negotiations are concluded.
3. Third letter – within ten days of the second letter, the employer discloses which employees are being dismissed due to the mass redundancy and notifies the Council thereof.
• Notification of employees.
1. The employer must notify the employees who will be dismissed. The notification of the employees must be given at the same time the Council has been informed (the third letter).
2. Employee notice periods are not affected by mass redundancies. Therefore, employees are entitled to be terminated with their usual notice period, which is agreed by law, in their contract or in a collective bargaining agreement.

If requirements are not met, the employees affected are entitled to compensation. This will be equivalent to eight weeks’ salary if the employer employs more than 100 staff and dismisses 50% or more of them, or, otherwise 30 days’ salary. Any violation of this process may also result in the employer being fined.

Timing

The procedure for collective dismissals can be completed within seven to 14 days. However, note that the Danish Act on Mass Redundancy prescribes that collective redundancies cannot take effect until 30 days after the date on which the Council has been notified of the redundancies (the third letter).

In addition, employees will be entitled to their terms of notice required by their individual employment agreement.

Notice Periods

The employee’s and the employer’s notice period may be stipulated in either the employment contract, in a collective bargaining agreement or in legislation – eg, the Danish Salaried Employees’ Act. If no statutory notice period applies, employment relationships can be terminated with a reasonable period of notice. 

Salaried employees subject to the Danish Salaried Employees Act are, as a general rule, entitled to a notice period from the employer of between one and six months, depending on the employee’s seniority at the company. However, the employee may terminate the employment with one month’s notice.

The Danish Salaried Employees Act provides an exception to the general notice period for employers: under the “120-day rule”, where an employee has been on sick leave for 120 consecutive days, an employer may terminate the employment with one month’s notice.

For salaried employees it is possible to agree on a probationary period of three months in which both parties may terminate the employment with 14 days’ notice.

Collective bargaining agreements usually contain detailed regulations on dismissals, including notice periods. The notice periods vary widely depending on the collective bargaining agreement. Although the notice periods are usually shorter than the notice periods under the Danish Salaried Employees Act, some collective bargaining agreements refer to the notice periods in the Danish Salaried Employees Act, whereas other collective bargaining agreements set out other notice periods.

The employee is entitled to receive their usual salary during the notice period. If the employee is released from the duty to work (“gardening leave”), the Danish Salaried Employees Act entitles the employer to offset salary earned from new employment against the salary payable during the notice period after the first three months of gardening leave.

Furthermore, the Danish Salaried Employees Act stipulates that employees with between 12 and 17 years of service are entitled to a severance payment corresponding to one month’s salary. Employees with more than 17 years of service are entitled to a severance payment corresponding to three months’ salary.

Summary Dismissal

Summary dismissal is the most severe sanction under employment law, involving termination by the employer of the employment relationship with immediate effect and without pay during the notice period.

The courts have imposed two strict requirements for a summary dismissal to be justified:

• the employee’s conduct must constitute a material (gross) breach of the employment relationship; and
• the employer must act immediately upon becoming aware of the relevant circumstances.

When a summary dismissal is challenged by the employee, the courts conduct a specific proportionality assessment in which the severity of the conduct, the employee’s length of service, any prior warnings, and the employer’s response time are all considered.

There is no exhaustive list of grounds for dismissal, but there are several circumstances that are typically recognised as sufficiently serious, including:

• theft from the workplace;
• violence or threats of violence against coworkers, customers, or the employer;
• gross fraud against the employer;
• gross breaches of trust;
• sexual harassment;
• unauthorised absence from work over a period of time; and
• deliberate obstruction of the company’s operations.

If a summary dismissal is not based on sufficiently serious grounds, the employee will typically be entitled to salary during the notice period that would have applied had the employee been dismissed with notice. Depending on the circumstances, the employee may also be entitled to compensation for unfair dismissal.

Termination agreements are permitted under Danish law and are commonly used as an alternative to dismissal by the employer. They can be used in both private and public employment. As a starting point, the employer and employee are free to agree on the terms of the termination. The parties may agree that the termination agreement constitutes a full and final settlement of matters relating to the termination. Thus, an employee may agree to waive rights that would otherwise apply in case of dismissal by the employer.

There are no general statutory requirements with regard to the form of a termination agreement. However, an agreement should normally be made in writing as the party relying on the agreement must be able to prove that it was concluded.

A termination agreement is generally binding on both parties. It may, however, be set aside if the agreement is considered unreasonable or if an assumption on which the agreement was based subsequently proves to be incorrect. The assessment may take into account the circumstances in which the agreement was entered into, including whether the employee had legal or union representation, whether the employee was under duress, and whether the employee had sufficient opportunity to understand the agreement and its consequences.

Protected Categories of Employees

Certain categories of employees have specific protection against dismissal related to specific circumstances under Danish law. These specific circumstances include employees undergoing fertility treatment, pregnant employees, and employees on maternity, paternity or parental leave. Employees are also protected against dismissal based on grounds such as gender, disability, sexual orientation, race or ethnic origin, age and religion or belief. The applicable protection depends on the circumstances and the relevant legislation.

Pregnant employees and employees on maternity, paternity or parental leave may be dismissed, but the dismissal must not be based on the pregnancy or leave. If an employee is dismissed during pregnancy or certain periods of leave, the employer will generally have the burden of proof with regards to proving that the dismissal was unrelated to the pregnancy or leave.

Employee Representatives

Employee representatives may also benefit from enhanced protection against dismissal. In particular, collective bargaining agreements generally provide special protection for trade union representatives and require compelling reasons for dismissal. In redundancy situations, the employer will generally need to show why it was necessary to dismiss the representative rather than another employee and consider whether the representative can be transferred to another suitable position. Collective bargaining agreements may also require specific procedures to be followed before the dismissal can take effect.

Dismissal or termination of an employment contract is a contractual matter. Therefore, if the employee is not subject to the Danish Salaried Employees Act or a collective bargaining agreement, the only prohibition against dismissal or termination is the prohibition against discrimination.

The Danish Salaried Employees Act contains extensive regulation on the dismissal of employees. In terms of grounds, the Act stipulates that the dismissal of a salaried employee must be fairly justified by the conduct of the salaried employee or the circumstances of the company. The requirement is, however, only applicable to salaried employees who have been employed with the company for at least one year (12 months) at the time of the termination.

As to collective bargaining agreements, dismissals are often regulated in detail, including the definition of permissible grounds for dismissals. Several collective bargaining agreements set out that dismissals must be fairly justified by the conduct of the employee or the circumstances of the company. The prohibition of unfair dismissals is usually only applicable to employees of a certain seniority with the employer. The required seniority depends on the specific collective bargaining agreement to which the employee is subject.

The Danish Act on Equal Treatment and the Danish Non-Discrimination Act set out several criteria prohibited as grounds for dismissal of an employee. If the dismissal of an employee is based, directly or indirectly, on these prohibited criteria, the dismissal will be considered unlawful.

In addition, some groups of employees are granted special protection against dismissals, including shop stewards and working environment (safety) representatives.

The Consequences of Wrongful Dismissal

White-collar employees

According to the Danish Salaried Employees Act, an employee who is subject to unfair dismissal is entitled to compensation of up to six months’ salary. The level of compensation is, however, determined by discretion in each case – eg, depending on the length of employment and the circumstances of the case in question.

Blue-collar employees

In collective bargaining agreements, the consequences of unfair dismissal vary. It will usually be very difficult to claim reinstatement, as the courts tend to consider the relationship between the employee and the employer as destroyed after court proceedings. However, several collective bargaining agreements, and notably the Main Agreement, also provide the possibility to grant compensation to employees with a seniority of a minimum of nine months. The maximum compensation is equivalent to 52 weeks’ salary, but is generally one to two weeks’ salary per year of employment, depending on the length of employment and the specific circumstances.

Anti-Discrimination and Equal Treatment

If the dismissal or termination of an employee is based, directly or indirectly, on the prohibited grounds for termination or dismissal as set forth in the Danish Anti-Discrimination legislation (ie, the Danish Equal Treatment Act and the Danish Anti-Discrimination Act), the dismissal will be unlawful, and the employee will be entitled to compensation. According to case law, such compensation is usually set at between six and 12 months’ salary.

Discrimination

According to Danish employment law, discrimination is unlawful regardless of whether it is direct or indirect.

• Direct discrimination is when an employee is treated less favourably on grounds of unlawful criteria than other employees are, have been, or would have been treated in a comparable situation. Direct discrimination cannot be justified.
• Indirect discrimination is when an act, a decision, a provision, etc, which appears to be neutral, entails that an employee, who is subject to any of the listed criteria, is, in fact, treated less favourably than other employees. Acts of indirect discrimination may be allowed if justified by legitimate, objective purposes and if the act, decision, provision, etc is considered a necessary and proportionate means of achieving this purpose.

Under Danish employment law, workers are protected against discrimination by three main statutes:

• the Danish Anti-Discrimination Act;
• the Danish Act on Equal Pay; and
• the Danish Act on Equal Treatment.

The Danish Anti-Discrimination Act

The Danish Anti-Discrimination Act protects employees against discrimination based on:

• race;
• skin colour;
• religion or belief;
• political belief;
• sexual orientation;
• gender identity, expression and characteristics;
• age;
• disability; and
• national, social or ethnic origin.

The Danish Anti-Discrimination Act prohibits discrimination based on the protected categories in any situation related to employment including hiring and dismissals as well as discrimination during employment – eg, in terms of the determination of working conditions. 

The Danish Act on Equal Pay

The Danish Act on Equal Pay governs the prohibition of discrimination on the grounds of employee gender in terms of wage for work performance of equal character or value. This includes all salary elements and conditions.

The principle of equal pay is expected to be further strengthened through the implementation of the Pay Transparency Directive into Danish law. The proposed rules introduce increased pay transparency requirements, including requirements to provide information on initial pay or pay ranges prior to employment, establish pay structures and objective and gender-neutral pay-setting criteria, and provide employees with access to certain pay information. Certain employers will also be subject to gender pay gap reporting requirements. The proposed rules are expected to enter into force on 1 January 2027.

The Danish Act on Equal Treatment

The Danish Act on Equal Treatment prohibits discrimination on grounds of gender in relation to hires and dismissals, as well as during the employment – eg, the determination of working conditions and/or benefits. The prohibition of discrimination on grounds of gender set out in the Danish Act on Equal Treatment obligate employers to make necessary adjustments to allow a pregnant employee to carry out work safely.

The Burden of Proof in Discrimination Cases

In discrimination cases, there is often a shared or reversed burden of proof. This means that the employer must be able to document that a dismissal or other adverse decision is not due to discrimination. This puts the employee in a stronger position in such cases, while the employer must ensure that decisions, justifications and communications are properly documented. Proper handling of documentation is therefore crucial to minimising the risk of disputes.

Compensation in Discrimination Cases

A violation of the anti-discrimination rules may entitle the employee to claim reinstatement, although this very seldom happens.

The amount of compensation depends on the nature of the violation, its duration, and its consequences for the employee. In practice, compensation is often awarded in the range of six to twelve months’ salary.

A discrimination case may be filed, among other places, with the Danish Board of Equal Treatment, which handles disputes regarding unlawful discrimination in employment relationships.

There are no specific rules governing the digitalisation of labour disputes in Denmark. Instead, the applicable rules depend on whether the dispute is heard by the ordinary courts, the Labour Court, or through industrial arbitration.

Proceedings Before the Ordinary Courts

Under the Danish Administration of Justice Act, civil proceedings are already highly digitalised. The court may permit a party or the party’s legal representative to participate in preparatory hearings via telecommunications, unless this is deemed inappropriate.

The Act also provides for the remote examination of witnesses. The court may decide that a witness must testify via video if this is deemed appropriate and justified. These rules also apply, with the necessary adaptations, to the examination of the parties. Where the parties agree, the court may also allow a witness to give evidence by video from a location other than a court or another officially authorised place, provided that the court finds this appropriate. This may include giving evidence from home using suitable video equipment.

Proceedings Before the Labor Court or Industrial Arbitration

With regard to the Labour Court, the Danish Labour Court and Industrial Arbitration Act provides that the rules of the Administration of Justice Act on civil trials at first instance apply to proceedings before the Labour Court, with the necessary adaptations. Accordingly, the rules on digital participation and remote examination described above may also apply to proceedings before the Labour Court, subject to the necessary adaptations. The same applies to labour arbitration, unless deviations have been agreed.

Denmark has specialised employment forums for disputes arising under collective bargaining agreements, but individual employment disputes are generally heard by the ordinary courts.

Denmark has one Labour Court (Arbejdsretten), which is separate from the ordinary court system. Under the Danish Labour Court Act, the Labour Court has exclusive jurisdiction over disputes regarding breaches of collective agreements concerning wages, working conditions and industrial action in contravention of collective agreements.

Proceedings before the Labour Court are commenced by filing a written plea of complaint. Throughout the proceedings, the parties are generally represented by their respective employers’ organisations or trade unions, which submit the written pleadings, present the case, examine witnesses and make the parties’ oral submissions at the hearing. During the preparatory stage, the Court also seeks to facilitate a settlement between the parties.

Individual employees cannot institute proceedings before the Labour Court. If the relevant trade union does not pursue an employee’s claim before the Labour Court, the employee may instead bring a claim for outstanding wages before the ordinary courts. The same applies to employees who are not members of a trade union.

Disputes concerning the interpretation of collective agreements are generally referred to industrial arbitration.

Disputes arising out of individual employment contracts are heard by the ordinary courts or, where the parties have agreed, by arbitration pursuant to the Danish Arbitration Act. Likewise, disputes concerning the interpretation of statutory provisions that fall outside the Labour Court’s jurisdiction are also heard by the ordinary courts, even where the employment relationship is governed by a collective agreement.

Arbitration

Arbitration is an alternative to the regular Danish courts. However, arbitration may only resolve employment disputes if the parties have agreed to this (eg, in the employment agreement). Therefore, the parties must agree on the employment dispute being resolved by arbitration.

Pre-Dispute Arbitration

Under the Danish Arbitration Act, employers and employees may generally agree in advance that future employment disputes are to be resolved by arbitration rather than by the ordinary courts. While Danish law expressly provides that pre-dispute arbitration agreements are not binding on consumers, no equivalent general restriction applies to employees. Accordingly, pre-dispute arbitration clauses may generally be used in employment relationships. However, Danish case law requires clear and qualified consent, and an arbitration clause may be set aside under Section 36 of the Danish Contracts Act if considered unreasonable.

Mediation

Mediation is becoming increasingly popular both as an agreed option in employment agreement and the Civil Courts now always offer the parties to a trail a Court Mediation pre-litigation.

Under the Danish Administration of Justice Act, the unsuccessful party in proceedings before the ordinary Danish courts is, as a general rule, ordered to reimburse the successful party for the legal costs incurred in the proceedings, unless the parties have agreed otherwise. The court may, however, decide that the unsuccessful party should pay only part of the costs, or no costs at all, if special circumstances justify such a decision.

Recoverable costs include the expenses necessary for the proper conduct of the proceedings. Attorney’s fees are awarded as a reasonable contribution determined by the court, while other necessary costs are reimbursed in full.

Different rules apply before the Labour Court. The costs of the Labour Court are first and foremost financed by the Ministry of Employment. However, under the Labour Court Act, the unsuccessful parties to the cases also contribute. The amounts are modest, currently DKK2,000 following a full hearing and DKK500 following a default judgment. Unlike ordinary civil proceedings, the Labour Court does not order the unsuccessful party to reimburse the successful party’s attorney’s fees or other legal costs.