Your firm may expand in Denmark without having to create an entity thanks to Marzuna’s Employer of Record (EOR) service. With our centralized and automated global HR platform, you can expedite the onboarding process for your remote workers and effectively manage their payroll, benefits, and other requirements. We assist you in simplifying the process of worldwide expansion with the informed assistance of our extensive global network.
We provide you access to the best Danish talent, regardless of degree of expertise. With our local network and global infrastructure, we can manage hiring, contract and payroll management, onboarding, and personnel record administration, freeing you up to focus on your company’s core business activities. Learn more about the specialized EOR services that Marzuna offers.
The Danish employment system embodies the concept of “flexicurity,” which combines flexibility with job security, a model embraced across Europe. Denmark’s labor market is known for its flexibility, ensuring that every member of the workforce has access to various job opportunities. The country boasts a high workforce participation rate, with around 50% of the population engaged in the labor force. Workers in Denmark have the freedom to engage in social programs and receive benefits in case of unemployment.
In Denmark, there are three primary categories of workers: managers and the self-employed, white-collar professionals, blue-collar workers, and others. While overarching rules and regulations apply to all these groups, there are specific laws tailored to each category to address their distinct needs and requirements.
All employees working within the country are safeguarded by Danish employment and labor laws, guaranteeing their rights and protections. Danish labor unions actively and effectively represent the interests of employees, and in some instances, collaborating with these unions may be a requisite when hiring frequently or under certain circumstances.
Having a solid grasp of Danish labor and employment regulations can provide businesses a significant competitive edge and expedite the expansion process. By being well-informed and compliant, organizations can confidently navigate the Danish labor market.
If you’re interested in delving deeper into the intricacies of working in Denmark and how it can benefit your business, we encourage you to reach out to us. Our knowledgeable staff can provide you with valuable insights and guidance to make informed decisions and capitalize on opportunities in the Danish market. Contact us today to learn more.
Some of the provisions of Employment Laws to note before hiring in Denmark are as follows:
| Title | Explanation |
|---|---|
| Danish Salaried Employees Act | The basic legislation that governs all white-collar workers in Denmark is the Danish Salaried Employees Act. It outlines in great depth the procedures for hiring, the legal responsibilities of employers and workers, probation and termination, benefits, and all other facets of employment. This Act covers all employment-related activities. |
| Danish Act on Restrictive Covenants | Restrictive covenants are clauses in a contract that specify the circumstances in which one party is unable to affect another. Restrictive covenants are a new notion in employment contracts brought about by this Act. |
| Danish Holiday Act | The Danish Holiday Act, a distinct piece of law passed by the Danish Parliament, specifies the number of vacations that certain employee classifications are entitled to. The mandatory holiday that employees must take, the monthly holidays to which they are entitled, and the accumulation of holidays are all covered by this Act. |
| Differential Treatment Act | The Differential Treatment Act, as its name implies, forbids treating workers or applicants for employment differently or unfairly on the basis of their age, skin colour, handicap, political opinions, religious convictions, ethnic origin, or nationality. |
Timings, Holidays, And Leave Policies in Denmark
| Entitlements | Explanations |
|---|---|
| Statutory Working Hours | In Denmark, a typical week would consist of 37 hours of labour. The main working hours are from 6:00 am to 6:00 pm, Monday through Friday. Typically, the lunch break lasts for 30 minutes. |
| Rest Period | If a continuous shift lasts more than six hours, a break is required. The length of the break will depend on its intended use, such as if it is a mealtime break. |
| Public Holidays | There are several national holidays in Denmark that are obligatory leaves for employees. These holidays are as follows.
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| Maternity Leave & Paternity Leave | Parental leave is permitted for a total of 50 weeks in Denmark. Up to 14 weeks after giving birth, the woman may take up to four weeks of leave. After this, the mother and father may freely divide the parental leave among themselves for an additional 32 weeks. |
| Sick Leave and other leaves | Employees may take sick leave for 30 days with pay. |
| Annual Leave Entitlement | According to the Danish Holiday Act, each employee is entitled to 2.08 days of paid leave every month, for a total of five weeks of paid vacation per year. Employees accrue vacation time throughout a 12-month period, and they then have 16 months to use at least 4 weeks of those vacation days. |
Denmark stands out for its education system, offering free education up to graduation for every child in the nation. Consequently, a significant portion of the Danish population comprises highly educated and competent individuals who contribute to a skilled labor force.
Denmark was an early adopter of remote work, embracing the concept long before it gained global prominence. The country’s robust internet and communication infrastructure, covering almost the entire nation, facilitated a seamless transition to remote work when it became a necessity worldwide in 2020. This was made possible by Denmark’s top-notch infrastructure and forward-thinking approach.
The Danish labor and employment laws encompass various forms of work. The Danish Salaried Employees Act, for instance, ensures that full-time employees who have met the requisite hourly thresholds for at least a month are entitled to contracts with associated benefits and conditions. Danish law also extends recognition and protection to agency, part-time, and temporary employees, emphasizing equal benefits and protections for all employee types.
In Denmark, the principle of equity and inclusion prevails in the labor market, where employees across all job categories are granted equal rights.
Businesses venturing into the Danish market should acquaint themselves with the intricacies of Danish labor and employment legislation. Effective management of these regulations not only fosters trust with employees but also cultivates a positive workplace culture.
If you’re considering establishing your presence in Denmark, don’t hesitate to reach out to us for a deeper understanding of the Danish labor market and to explore potential opportunities for your company. Our experienced staff can guide you through the nuances of operating in Denmark, enabling you to make informed decisions and succeed in this competitive market.
Employees at all levels have the right to negotiate their remuneration with their employer. The discussion of pay for a particular role is typically a standard phase in the hiring process, with candidates expressing their salary and benefits expectations during the final stages.
It’s important to note that the bargaining power of employees tends to increase with their position within the corporate hierarchy. In Denmark, there is a limited pool of highly qualified individuals available for top-level roles compared to other labor markets. As a result, employers often take applicant preferences into account, particularly when filling senior positions.
Creating a comprehensive job description marks the initial and vital step in the hiring process. This seemingly straightforward task often requires days of collaboration between the HR team and the hiring department to ensure it aligns with the company’s needs. Once finalized, the job description is posted on the company’s Careers website, as well as on job search platforms and professional social media sites like LinkedIn.
Subsequently, the HR team commences the review of submitted applications, either on an ongoing basis or after the application deadline. A select group of candidates is then invited to advance to the subsequent stages of the recruitment process after an initial screening.
In cases where there are numerous shortlisted candidates, many companies employ a written test as the initial screening stage. Those who excel in this assessment proceed to the interview rounds, which may encompass technical evaluations and interviews with senior management and HR representatives. For higher-level positions, there are often fewer formal interviews.
The HR team then conducts thorough background checks on the remaining applicants. Successful evaluations culminate in the issuance of formal employment offers to the chosen candidate.
Leveraging online talent portals offers several advantages, primarily the ability for HR teams to conduct the entire hiring process within the confines of their office. This significantly reduces hiring costs. However, one notable challenge of online recruitment in Denmark is the potential for an overwhelming volume of applications, as highly skilled candidates actively seek out positions, placing considerable demands on HR teams.
While online recruiting expedites the hiring process, organizations must efficiently manage the influx of applications and establish effective methods for screening and shortlisting candidates. HR teams can navigate the challenges posed by high application volumes by leveraging technology and implementing robust selection criteria.
We offer professional guidance and support to optimize your hiring endeavors in Denmark, ensuring a successful recruitment outcome. To learn more about our comprehensive hiring solutions tailored for the Danish market, don’t hesitate to reach out to us today.
In Denmark, the specific rules governing probation periods are not explicitly defined. Instead, the duration of the probationary period is typically outlined in the employment contract negotiated between the employer and the employee. In most cases, the probationary period does not extend beyond six months.
When it comes to termination, Denmark stands out as a country with relatively straightforward procedures compared to other European Union nations. Unless employees are covered by a fair dismissal clause in their contract or protected by provisions outlined in the Salaried Employees Act, there is no inherent protection against dismissal. Employers are not required to inform trade unions or employment agencies when terminating an employee.
Simplicity in termination is further facilitated by the ease of access to unemployment benefits in Denmark. However, certain specific protections against termination exist for employees on parental leave, individuals belonging to certain minority groups and communities, or those elected as representatives of a union.
While termination procedures may seem more straightforward in Denmark, it is crucial for employers to remain knowledgeable about the specific terms outlined in employment contracts and applicable legal provisions. Compliance with relevant laws and regulations, as well as adherence to fair and ethical employment practices, is essential for maintaining a positive work environment and safeguarding employee rights.
As experts in the Danish employment landscape, we can provide comprehensive guidance and support in navigating probationary periods, termination processes, and compliance with relevant legislation. Contact us today to learn more about our tailored solutions for your specific employment needs in Denmark.
Establishing a company in Denmark involves a lot of work. There are a lot of laws and regulations that you have to follow, and one error might postpone the entire process for many weeks. By using their solid local network and understanding of Danish labor and employment legislation, a Danish EOR partner like Marzuna can help put everything in perspective and facilitate the smooth growth of your business.
Remember that having an Employer of Record on your team offers more for you than just expediting the hiring and onboarding process. You are also freeing up time for yourself to focus on other important aspects of your development. Discover more about the benefits of Marzuna EOR solutions from our experts.
| Visa Category | Explanation | Duration |
|---|---|---|
| Short-Stay Visa | You may be granted a short-stay visa to Denmark for a number of reasons. These visas allow you to visit family and friends in Denmark and are not merely limited to travel. | Up to 90 days |
| Business Visa | In general, Denmark also issues short-term business visas. You must be able to prove that you will be travelling to Denmark for business-related purposes and the length of your stay there. This can take the shape of letters of invitation and other forms of proof. | Up to 90 days |
| Long-Stay Visa | Denmark’s long-stay visa is often only issued on a case-by-case basis. You must be able to prove that you will need to travel to Denmark often for a brief period of time. Being an EU citizen normally makes it much simpler to obtain this visa. | Up to five years, during which time you may spend 90 out of every 180 consecutive days in Denmark. |
| Work Visa | European Union nationals do not require the visa required to work in Denmark, while all other nationalities do. The employer often applies for, or at least sponsors, the employee’s Danish work visa on the employee’s behalf. | Up to 4 years |
Non-EU nationals, particularly those from the Nordic nations, must apply for a separate work permit in order to work in Denmark. When you have a job offer in hand, you can apply for this work permit. Work permits for other forms of employment are only issued for periods of three months at a time, whereas those for indefinite employment are provided for a maximum of four years and are renewed. Speak with our specialists right now to learn more about work permits in Denmark and how we can get them for you to begin your growth process.
Payroll setup in Denmark must strictly adhere to local rules and regulations. This entails any payroll benefits and clauses that you are required by law to offer your employees.
Taxation is a related factor to which you should also pay attention. Taxes are among the most strictly enforced laws in the world and can vary greatly from nation to nation. One of the most crucial areas where an EOR partner may be very beneficial to you is in the area of taxes, helping you with payroll setup and paying your fair amount of taxes. To learn more about the Danish payroll and taxation system, schedule a demo with us.
| Process | Details |
|---|---|
| Taxation ID | The SE Number is the special identification number used for tax reasons. Every time you pay taxes, the SE number must be mentioned. The Danish Customs and Tax Administration, or SKAT, is responsible for issuing this number. |
| Choosing a Payroll System | The perks and provisions that must be provided to employees in accordance with local regulations should not be the least of these considerations when choosing a payroll system.
The sort of people you recruit and how they are divided between your company’s full-time employees and contractual or agency workers might also influence your choice of payroll system. |
| Acquisition of employee information | It is essential to have all personnel information on hand, both for tax purposes and to expedite internal operations.
You need to have cutting-edge, secure IT solutions so you can easily store and access employee data. |
Employer Taxation
| Tax | Explanation |
|---|---|
| Corporate tax | 22% |
Employee Taxation
| Tax | Explanation | ||||
|---|---|---|---|---|---|
| An employee’s wage is subject to income tax (there are two structures available; employees can select the one they like to use). |
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| Financial year-end date | 31 December | ||||
| Sales Tax | 25% |
Despite the fact that Denmark does not have a law requiring the payment of a 13th paycheck, performance-based incentives are gaining popularity.
Establishing a subsidiary in Denmark can be a surprisingly smooth and efficient process when you adhere to the necessary guidelines. Here are the straightforward steps to create your subsidiary:
Ensuring strict compliance with all legal requirements and regulations is a paramount consideration when establishing a subsidiary in Denmark. Seeking professional guidance can expedite the process and ensure that your subsidiary is established in full accordance with Danish law.
Our organization specializes in providing tailored solutions for the creation of Danish subsidiaries and offers comprehensive support throughout the entire process. We are dedicated to helping you achieve successful growth in Denmark, from legal compliance to strategic counsel. To discuss your specific requirements and determine the optimal approach for establishing your subsidiary in Denmark, please don’t hesitate to contact us today.
