General information about Work-Related Injuries in Denmark
In Denmark, work-related injuries are generally handled pursuant to the Mandatory Workers Compensation Act and the Danish Tort Liability Act.
The Mandatory Workers Compensation Act
All employers in Denmark are obliged to take out mandatory workers’ compensation insurance according to this act. For injuries covered by this act, compensation for permanent injury and compensation for loss of earning capacity can be paid if the conditions are met. The types of injury eligible for compensation under the Act are (i) accidents and (ii) occupational diseases.
Further, it is possible to be compensated for costs related to medical treatment and/or rehabilitation when essential for achieving optimal recovery.
The Danish Tort Liability Act
In the event an employer (or another tortfeasor) is liable for an employee’s injury, the injury will also be handled pursuant to this Act. Just like injuries being handled pursuant to the Mandatory Workers Compensation Act, compensation can be paid for permanent injury and loss of earning capacity. In addition, compensation can be paid for loss of earnings, compensation for pain and suffering and compensation for other losses.
Further, under certain circumstances it is also possible to be compensated for medical treatment and/or rehabilitation under this Act.
Certain damages can be claimed under both the Mandatory Workers Compensation Act and the Danish Tort Liability Act. However, to prevent instances of “double-compensation”, if a particular damage qualifies under both acts, compensation will be granted under only one of them.
If an injury qualifies under both the Mandatory Workers Compensation Act and the Danish Tort Liability Act, the former takes precedence.
However, the compensation amount for loss of earning capacity is not calculated identically under both acts. This disparity results in situations where:
Such cases, as described, are termed “differential claims”.
Generally, employers’ liability insurers have an interest in ensuring that as much as possible can be covered under the Mandatory Workers Compensation Act. Against this background, it is particularly relevant to keep track of any legislative initiatives that have or may have an impact on the calculation of the claims covered under both acts.
In the spring of 2023, a significant legislative initiative commenced, with the introduction of a bill proposing amendments to the Mandatory Workers Compensation Act. Among other things, the bill aims to change the methods used to calculate claims under this act.
The bill is still under negotiation at the time of this article, but is expected to enter into force on 1 July 2024. The most important aspects of the bill will be mentioned below under Proposed new legislation.
New Developments in Relation to the Mandatory Workers Compensation Act
The COVID-19 pandemic triggered an unprecedented transition to home-based work, leading to a surge in reported work-related injuries at home post-2020. Distinctions between work-related and private injuries in a home setting became blurred.
According to The Mandatory Workers Compensation Act, injuries sustained at home can be a workplace injury if the injury occurred as a result of the work or the conditions of the work. This was addressed in the decision of the Eastern High Court, UfR 2023.3073 Ø. Employee A, who did most of his work from home, fell on 21 October 2016 when he was moving his desk. The issue in the case was therefore whether A’s fall at home was a consequence of the work or the conditions under which the work was performed (see Article 5 of the Mandatory Workers Compensation Act).
The ratio decidendi of the Eastern High Court was that: “[...] according to the legislative history and legislative history of the provision, it is a condition that at the time of the injury the employee was in the employment of an employer and that the injury was caused by the work or the conditions under which it was carried on. In this connection, the legislative history states that if the injury occurs during leisure time or during private errands, or on the way to or from the workplace, the injury will not normally be recognised as an occupational injury, even if the requirements are otherwise met.”
As A had agreed with his employer B to take time off on 20 and 21 October 2016, A fell on his day off. Against this background, the Eastern High Court found that B had not influenced A’s organisation of his home workplace. Therefore, B was not found to have had such an interest in the relocation of the desk that the fall accident should be considered a consequence of the circumstances of the accident.
On this basis, and as A was moving the desk on his day off, the High Court found that A’s fall was outside the purview of Article 5 of the Mandatory Workers Compensation Act and therefore the injury was not a work-related injury in accordance with the Act.
As similar cases are expected to increase in number, the Authorities have established new guidelines on work-from-home injuries. These guidelines are established in so-called “Notices of Principle”, some of which are outlined below.
Notice of Principle 8-22 (7 April 2022) on Occupational Injury – Working Conditions
Injuries occurring while work is carried out from home can be a consequence of the work or the conditions under which the work is carried out. This can be either activities directly related to the work or activities that have a necessary or natural connection to the work. Such injuries may, after an overall assessment of the evidence, be covered by the law.
When the injured person works from home, work-related and private actions are more closely linked than at the workplace. Therefore, there is not the same presumption that the injury occurred as a result of the work or the conditions under which the work was carried out.
The assessment of whether an injury occurred as a result of the work or the conditions of the work must include whether the injured person’s behaviour at the time of the injury had a necessary or intrinsic connection to the work. Actions fitting this criterion include:
Regardless of whether the injured person’s behaviour has a necessary or intrinsic connection to the work, if an injury results from conditions or circumstances primarily influenced or caused by the injured person, it will not qualify as an injury that occurred as a result of the work or the conditions of the work. An example would be tripping over personal items at home.
Notice of Principle 40-22 (29 November 2022) – on Occupational Injuries – Working Conditions – Working From Home
If an injury occurs while the injured person is working from home, the injured person is generally covered by the law. This applies regardless of where in the home the work was being performed when the injury occurred.
However, the principle does not apply if the employer has set clear conditions for how the work at home should be performed and the injured person does not comply with these conditions at the time of the injury.
Injuries related to COVID-19
In 2021 and 2022, the Danish Authority that handles possible work-related injuries in the first instance, Labour Market Insurance (Arbejdsmarkedets Erhvervssikring or AES), received the highest number of reported cases since 2016. This is attributed in particular to reported illnesses/injuries related to COVID-19.
As of 1 July 2023, the AES has received a total of 18,550 notifications of work-related injuries related to COVID-19. However, from 1 April 2023
the Danish Health Authority (Sundhedsstyrelsen) changed the categorisation of COVID-19 from a generally dangerous disease to an infectious disease, so COVID-19 should no longer be reported as an occupational injury. As a result, the total number of reported work-related injuries is expected to fall in 2023.
Mental health-related injuries
In 2020, the Mandatory Workers Compensation Act specifically included mental health-related injuries in the definition of a potential work-related injury. Due to this, the number of reported mental health-related injuries has increased significantly and this development seems to be continuing.
According to the recent 2022 report from AES (published in 2023), in 2018, 3,873 cases of mental health-related injuries were reported as occupational diseases. By 2022, the number of mental health-related injuries reported as occupational diseases had risen to 4,926, an increase of more than 27%. Mental health-related injuries include diagnoses such as PTSD but also the potential consequences of, for instance, bullying.
New Developments in Relation to the Danish Tort Liability Act and Work-Related Injuries
There has also been an increase in mental health-related injury cases filed under the Danish Tort Liability Act since 2018.
In 2021, the Danish Western High Court issued the following related decision.
The case concerned employee A, who faced prolonged bullying from colleagues at her place of work, a residential home. This protracted bullying culminated in A developing a diagnosed occupational disease.
The bullying continued for a long period of time in 2014, and led to A suffering psychological problems and going on sick leave on 25 June 2014.
The High Court stated that “[…] on the basis of the above, it is established that A was subjected to bullying for a long period of time in 2014, which led to psychological problems and sick leave on 25 June 2014, and that the local management of the Central Denmark Region was or should have been aware that A was being bullied. [...] On the basis of the medical records and the decisions of Labour Market Insurance, it is assumed that the psychological problems were the triggering cause of the sick leave on 25 June 2014 and contributed to the entire course of the illness up to the transition to a flexible job. A has therefore proved that there is the necessary causal connection between the bullying and the claim for compensation for loss of earnings.”
The increasing number of claims for and the expanding coverage of mental health-related injuries suggest that this trend will continue.
Proposed New Legislation
As mentioned above, the legislature has introduced a bill to amend the Mandatory Workers Compensation Act. The bill has not yet been finalised, so it is not clear at this point what the final amendments will look like.
Currently, Article 1 of the Act sets out its central objective (the “purpose clause”): offering compensation and damages to individuals (or their heirs) following a work-related injury. The proposed bill seeks to supplement this purpose clause, emphasising the Act’s role in not only providing monetary relief but also bolstering the injured individual’s chances of re-entering the workforce post-injury. The aim is to ensure that they achieve stable employment, supporting their financial independence (as outlined in the legislative remarks, section 3.1.1, page 34 of the bill).
A novel proposition within the bill is the concept of “educational compensation”. This would grant the injured party an opportunity to pursue a qualifying education. The objective is to solidify or enhance their connection to the job market. This compensation specifically targets individuals expected to have a permanent injury rate at 10% or higher. The rate of permanent injury is determined by the AES, either using their guiding list or through an estimation if the injury is not listed. Every year, the AES will determine a new amount of compensation for permanent injury. Annually, the AES updates the compensation amount for these injuries. As of 2023, an injury rated at 100% leads to a compensation of DKK979,000.
Notably, the bill indicates that those with an anticipated permanent injury of 10% or more tend to demonstrate a weakened connection to the job market post-injury, a trend that remains consistent over time.
Moreover, the bill proposes an offset mechanism. If the injured party qualifies for educational compensation under the Mandatory Workers Compensation Act, this can be offset against any compensation for lost earnings they might receive under the Danish Tort Liability Act (if applicable), particularly if a liable tortfeasor (such as an employer) is identified
The introduction of educational compensation would be a significant innovation in the field of work-related injuries in Denmark. By equipping injured individuals with a new qualifying education, the scheme anticipates minimising, if not eliminating, any loss of earning capacity.
Further, the bill proposes that a tortfeasor liable for damages – or their liability insurance company – is given extended access to reimbursement of compensation for loss of earnings in accordance with the Danish Tort Liability Act. Changes are also proposed to the way compensation for loss of earning capacity is calculated in the Mandatory Workers Compensation Act.
Finally, it is worth noting that for workplaces where employees are at risk of being exposed to violence or violent incidents, it is proposed that certain public and private employers be obliged to take out a “Violence Injury” insurance policy that will cover claims for compensation and damages for personal injury under the Danish Tort Liability Act.
Consequently, even if a liable tortfeasor is determined following a standard legal assessment, employees are still guaranteed their due “differential claims” (claims not covered by the Mandatory Workers Compensation Act).
For years, various stakeholders have advocated for a more harmonised integration between the two acts. Given this context, it will be interesting to see the outcome of the negotiations.