HR Consultancy Services in Denmark
IRIS HR Consulting has an excellent reputation for helping businesses explore new opportunities in Denmark. It can otherwise be risky to leave local laws and legislation open to interpretation. For a scalable, compliant operation, IRIS can manage your HR in Denmark to help businesses hire, recruit, and pay staff overseas. As a popular destination for businesses, IRIS can navigate local barriers – from culture to compliance – to arrive at a rewarding opportunity for your business to thrive in this exciting European marketplace.
Take your business to Denmark with the help of our specialist HR consultants at IRIS.
Global Expansion in Denmark
Enjoy Denmark’s “Flexicurity”
In recent years, Denmark has courted global press for its status as the happiest place in the world, according to the UN World Happiness Report. Denmark is desirable for its rapidly growing economy, ideal access (owed to its central European location) to key European markets, and its familiar native business-language (Danish and English).
This country has sustained a favourable ranking in the World Bank’s Ease of Doing Business, placing fourth (out of 190 polled nations). Its economy relies on an advantageous (and scaling) export opportunity, along with a developed service sector. Denmark has become desirable for its conducive business climate; it records, for example, a low criminality and corruption rate annually. Denmark’s economic success could also be owed to its transparent regulatory system. The Danish workforce is considered among of the most productive in Europe.
Denmark is favourable for its flexible labour market and climate, known casually as “flexicurity” (a balance of flexibility and security). Flexicurity is a strategy for a welfare state that attempts to create a flexible workforce for businesses, whilst satisfying a worker’s need for security. As a mean of modernising the labour market, this style of welfare negotiates social security into employment to arrive at an efficient labour market.
A Guide to Employing Staff in Denmark
Everything you need to know about the employment laws and compliance requirements in this country
Establishing Your Business in Denmark
When expanding your business into Denmark, you must consider how to manage a compliant operation that works within local employment laws and wider legislation.
Establishing a business, you should first consider your type of business:
- A limited liability company (public or private).
- Branch or representative office.
You’ll need to register for VAT and tax once your company is registered at the Danish Business Authority. Once registered, your business will fall under jurisdiction of Danish tax legislation and the kinds of tax you pay will depend on your established business type.
Employment Laws in Denmark
When first expanding your business into Denmark, navigating employment laws and remaining compliant will be core to your hiring strategy. For those unfamiliar with local employment and labour laws, this will be no easy job.
In Denmark, and across Europe, the relationships between an employer and employee are governed by the agreements reached through individual contracts and by the statutory frameworks that regulate terms and conditions of employment.
The main legislation dealing with the employment of white-collar employees is the Salaried Employees Act, which applies to employment characterised as salaried, commercial, clerical or managerial work. The employment of blue-collar employees on the other hand are mostly governed by collective bargaining agreements.
Did you know?
An employee is entitled to take 3 consecutive weeks’ annual leave during the main holiday period which runs from 1st May to 30th September.
Hiring & Recruitment in Denmark
When getting your first hire in Denmark, you will need to carefully negotiate terms in a contract and balance this with statutory regulation. This step may require expert consultation to ensure compliance.
Work Visas in Denmark
Residents of neighbouring Nordic countries, such as Finland and Iceland, don’t require a visa to work in Denmark. This applies to EU and EEA countries, but professionals looking to work in Denmark will still need to satisfy Danish Immigration Services as well as the Danish Agency for International Recruitment and Integration’s (SIRI) immigration policy.
For foreign nationals applying for work in Denmark, you will need to understand the expectations as outlined by SIRI.
Employment Contracts in Denmark
A trade union doesn’t have to be consulted in the drafting of a Danish employment contract. Even when a collective bargaining agreement is in place, there are still a few general laws, which should guide employee etiquette.
Here’s what’s generally included in an employment contract:
- The employer’s and employee’s name and address
- The address of the workplace
- Your job title or a description of your work tasks
- The date employment commences and possibly the end date for employment on a project basis
- The employee’s rights – paid holidays, for example
- Rules for notice of termination
- Salary, additional salary, when pension is paid, for example
- Working hours (daily or weekly) as well as any overtime agreement
- Indication of the current collective agreement or other agreements
What are the Working Hours in Denmark?
There are no general rules on working hours – which includes overtime. The time contained in a contract is usually determined by either a collective agreement or a local agreement.
Working times can usually be categorised as following:
- The 11-hour rule
- The 48-hour rule
- One weekly day and night-time off
Typically, a working week in Denmark consists of 37 hours, spread over 5 days (Monday to Friday). The working day is often between 06:00 and 18:00, where evening or night work may be subject to different hours.
For most in full-time employment, their hours will be fixed through collective wage agreements. Your week can be longer if you’re self-employed or presently in a managerial position.
Equal Opportunities in Denmark
For global businesses posting staff in Denmark, their employment rights are covered by the Danish regulations on gender equality and workplace opportunity. The workplace in Denmark, as with many European territories, is governed and protected under proactive equality arrangements.
Working Overtime in Denmark
Generally, employees should work overtime if asked by their employer, unless an urgent matter or other emergency requires them to be elsewhere. These obligations can be captured in a contract, which is often the best way to ensure your employee understand his/her expectations on overtime work.
This is a flexible contract that allows working hours to correspond with the needs and demands of an employee’s workflow.
Additional Vacation (Feriefridage)
Often known as the sixth week of vacation, this benefit is not covered by the Danish Holiday Act. Rather, additional paid leave should be reached through negotiations and captured in an agreement.
Sick Leave in Denmark
The exact terms and conditions will be referred to in a contract, which will need to make note of whether this period is salaried or not. Yet, it’s very common for employers to offer this benefit for unwell employees. Without this benefit, your employer will pay out ‘sick pay’ for 30 days from the first day of absence.
Vacation in Denmark
Denmark may enjoy one of the highest amount of paid leave days, but these are tightly regulated by local laws. Typically, employees in Denmark benefit from up to five weeks of paid leave for vacation, on top of national vacations.
The Danish Holiday Act covers most of the salary issues for employees, excluding independent workers, such as consultants and freelancers, or non-blue-collar employees.
This benefit is, however, regulated as follows:
- The five weeks paid leave must be used within the Danish Vacation Year (Mat 1st until April 30th).
- Paid vacation time is usually earned, where it accumulates at rate of 2.08 days per month.
- Vacation earned is used in the next calendar year.
Parental Allowance in Denmark
In full, parents can get this paid benefit to cover them for 52 weeks. Generally, this benefit entitles mothers to four weeks of paid leave before the planned birth of a child, and 14 weeks thereafter.
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End of Service
HR in Denmark means ensuring compliance not only during an employee’s service, but also at the end of it. End of service might include severance, termination, redundancy, and leaving packages. Or, for globally mobile companies with international teams, this could be repatriation services for those returning from an assignment overseas.
For these more complicated matters, you will need expert HR guidance in order to navigate Denmark employment laws and remain compliant.
Termination/ Severance in Denmark
Many employed in Denmark are covered under “funktionærloven”. If your contract contains this act, there are clear rules regarding termination:
- Employed for up to six months – one month notice period
- From six months to three years – three-month notice period
- From three years to six years – four-month notice period
- From six years to nine years – five-month notice period
- Over nine years – six-month notice period
Employers will typically implement a pension fund for their employees. These funds can sometimes include a Life and Disability policy instead of having separate schemes.
Waiting lists are common in the Danish health system so private medical plans are commonly offered by companies. The insurance is generally paid by the employer for the employee with the option for employees to pay to add their dependents to the cover.
It is typical that companies who offer the DC pension have life insurance covered within this however some companies do offer a separate life insurance plan and is covered 100% by employers.
This is becoming a very common benefits that companies offer; being funded totally by the employer.
Should an employee be expected to travel for work, they are provided a company funded travel insurance scheme.
Work culture in Denmark
According to Danish culture, the workplace is characterised by working in teams, flexibility in working hours, and a proactive and often informal attitude.
Why Partner With IRIS?
When entering new, exciting countries in Europe, like Denmark, you will need an employment specialist to navigate the parts of local laws that are mandatory and those that are not. Delivering a compliant solution, IRIS can help your business arrive into new marketplaces whilst protecting your workforce – our partners can discover power and protection through us.
Overseas expansions can seem risky to those who dare it alone. Understanding the complexity of a fully complaint solution, IRIS can help businesses establish a foreign branch in Denmark without the hassle.
Our cost-effective, knowledgeable approach to HR in Denmark makes us an ideal partner to commence your overseas plans.