Remote’s guide to employing in Denmark.
(Q2 2020 est.)
Remote-Owned Local Entity
We own our own entity in the countries where we operate to shield your company from risk and provide you and your employees with the signature Remote experience.
Denmark (Danish: Danmark), officially the Kingdom of Denmark (Danish: Kongeriget Danmark), is a Nordic country in Northern Europe. Denmark is considered to be one of the most economically and socially developed countries in the world. The country ranks as having the world's highest social mobility, a high level of income equality, the lowest perceived level of corruption in the world, the eleventh-highest HDI in the world, one of the world's highest per capita incomes, and one of the world's highest personal income tax rates.
5,824,857 (Q2 2020 est.)
Ease of doing business
Cost of living index
$$$$ (7 of 139 nations)
VAT - standard rate
GDP - real growth rate
1.49% (2018 est.)
Employing in Denmark requires employers to own a legal entity in the country and manage payroll, tax, benefits and compliance through their own in-country resources. The complexity of employment regulations in Denmark makes full compliance with employment laws a burdensome process.
Through Remote’s Global Employer of Record solution, your team is employed by our local legal entities in each country, and we take care of payroll, tax, benefits and compliance so you can focus on what matters most -- your people.
Employment law in Denmark is governed by statutory legislation and collective labour labour agreements. Denmark has a long tradition of allowing the conditions of employment and pay to be decided on through collective bargaining agreements. This means that there are just a few pieces of legislation that applies to all employers and employees, such as the Danish Salaried Employees Act (Funktionærloven and the Holiday Act (Lov om Ferie).
Almost all employment contracts in Denmark are governed by collective agreements. Danish employment law and collective agreements provides strong labor conditions and protections for employees, so employing people will be an important investment and commitment.
Temporary agencies are popular options for more flexible workforce arrangements. For these and many other reasons, the following are only guidelines in the broadest sense, and professional legal services are recommended when employing in Denmark.
|Saturday, January 1, 2022||New Year's Day|
|Thursday, April 14, 2022||Maundy Thursday|
|Friday, April 15, 2022||Good Friday|
|Sunday, April 17, 2022||Easter Sunday|
|Monday, April 18, 2022||Easter Monday|
|Sunday, May 1, 2022||Labour Day||Labor day is not a day we observe in Denmark, only certain companies that belong to unions, and the public sector follows this. For Remote, this would not apply for your ees|
|Friday, May 13, 2022||Prayer Day|
|Thursday, May 26, 2022||Ascension Day|
|Sunday, June 5, 2022||Whit Sunday|
|Sunday, June 5, 2022||Constitution Day||Government Holiday. It is often up to the respective parts of the country whether the holiday is also a day off.|
|Monday, June 6, 2022||Whit Monday|
|Sunday, December 25, 2022||Christmas Day|
|Monday, December 26, 2022||2 Day of Christmas|
There is no statutory minimum wage in Denmark, but national collective bargaining agreements negotiated between workers' unions and employer associations effectively set minimum wages. The average effective hourly minimum salary across all private and public sectors is approximately 110 DKK.
For customers of Remote, all employee payments will be made in equal monthly installments on or before the last working day of each calendar month, payable in arrears.
We can help you get a new employee started in Denmark fast. The minimum onboarding time we need is only 9 working days.
Our team ensures your employees are onboarded and paid as quickly as possible while keeping your business compliant with all local employment legislation. The minimum onboarding time begins after the employee submits all required information onto the Remote platform. The onboarding timeline is also dependent upon registration with local authorities.
For all non-nationals of the country of employment, the Right to Work assessment (if applicable) will add three extra days to the total time to onboard. There may be extra time required if we need to follow-up on the right to work assessment.
Please note, payroll cut-off dates can impact the actual first day of employment. Remote has a payroll cut-off date of the 10th of the month unless otherwise specified.
Remote supports our clients by offering competitive benefits packages that will help you attract and retain the best talent across the globe! Our benefits specialists have done the research on norms and requirements in each local market and have crafted packages that will allow your employees to thrive, no matter what country they live in.
Our benefits packages in Denmark are tailored to fulfil the local needs of your employees. Typically, our packages contain some or all of the following benefits:
Our core benefits (which often include things like healthcare) are required in most countries where we hire. Because Remote is the employer of record, it’s important for us to offer the same core benefits to all employees in a country to ensure fair equity and non-discriminatory hiring practices, which protects your business and ours. Note that we do not add a markup on any benefits premiums or administration costs.
If you'd like specific information about our benefits packages in Denmark, start onboarding your first employee with Remote today.
For more insight into fair equity and benefits best practices, download our Global Benefits Guide and share with the rest of your hiring team.
Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Denmark.
2,791 DKK - Employer's Reimbursement System (AUB)
2,272 DKK - Danish Labour Market Supplementary Pension Scheme (ATP)
1,176 DKK - Occupational injury insurance (Arbejdsskadeforsikring)
1,150 DKK - Maternity/paternity leave fund (Barselsfond)
592 DKK - Financing for ATP contributions for the unemployed (FIB)
299 DKK - Labour Market Insurance (AES)
12 DKK - Securing payment for foreign workers in Denmark (AFU)
1,136 DKK - Danish Labour Market Supplementary Pension Scheme (ATP)
8% - All income from employment or self-employment (arbejdsmarkedsbidrag, also known as bruttoskat)
0% - Up to 46,200 (still subject to bruttoskat)
12.14% - 46,201 - 513,399
15% - Above 513,399
24.954% - All income, average municipal tax
All full-time workers are entitled to 5 weeks days paid holiday leave a year under the Holiday Act (Lov om ferie). Holidays accrue from the previous calendar year and can be taken in the holiday year which runs from 1 May to 30 April in the following year.
According to the Danish Salaried Employees Act, an employee is entitled to full pay when they are ill, regardless of the tenure of the employee or the period of the employee's illness. Employers need to apply for sick pay for the employee if they are sick for more than 30 days, and this application must take place no later than five weeks after the first sick day.
Expecting mothers are entitled to 4 weeks of pregnancy leave (before the due date) and at least 14 weeks maternity leave after childbirth. During the period of maternity leave, the mother receives 50% of their salary. However, employer and employee can agree to full pay entitlement.
Fathers are entitled to 2 weeks of paternity leave before the birth and 14 weeks after. There is no statutory right to salary, but the father may receive leave benefits from Danish authorities.
Termination of the employment relationship always have to be with written notice with proof that the notice has been received. Employees have been employed for at least one year at the time of the termination are protected against dismissal without just cause. Generally, collective bargaining agreements have the same protection, but after 9 months. Just causes include, but are not limited to:
The statutory notice period for an employer depends on the duration of employment:
For salaried employees, probationary periods of up to three months are allowed.
During these three months it is possible to agree that both parties can terminate the employment with 14 days’ notice.
For non-salaried employees, there is no minimum or maximum probationary period (unless agreed in a collective agreement).