News rules for employment contracts and certain working conditions
Many of our foreign clients have been asking about the status of the implementation of the EU Directive on Transparent and Predictable Working Conditions (Directive 2019/1152/EU) in Denmark. The EU Directive was to be implemented by the EU members states on 1 August 2022, but the implementation was postponed in Denmark, until now.
On 11 May 2023, the Act on Employment Certificates and Certain Terms and Conditions of Employment was adopted in Denmark. This Act will implement the Directive on Transparent and Predictable Employment Conditions. The new legislation will enter into force in Denmark on 1 July 2023.
The new rules will apply for all Danish or foreign companies with Danish employees.
What is the scope of the new law?
The Act on Employment Certificates and Certain Terms and Conditions of Employment will apply to all who are employed with predetermined or actual working hours that amounts to an average of more than three hours per week (in a reference period of four consecutive weeks).
The law will also apply, if no guaranteed amount of paid work is fixed in advance of employment.
Checklist – Which information is the employer obligated to disclose?
The new law obliges the employer to disclose certain information to the employee within certain timeframes.
Under the new law, the following information must be provided to the employee within seven days from the start of the employment (not exhaustive):
- Name and address of employer and employee
- Information about the workplace location
- Job description/job title
- Commencement date of employment
- Expected duration of employment (in case of fixed-term contracts)
- Duration and conditions for any probationary period
- Wage including allowances/other supplementary pay elements that are not included in the wage, and wage payment dates.
- Normal daily or weekly working hours
- Information regarding guaranteed working hours, advance notice, etc., when the employee’s working pattern is totally or predominantly unpredictable.
Furthermore, the employer is obliged to provide the employee with the following information within the first month of employment:
- Employee’s rights to paid leave or other paid absence
- Notices of termination
- The relevant CBA and other agreements
- Training/education that the employer may offer
- Identification of the user company for temporary employment
- Identification and information about the social security institutions to which the employer may pay.
Please note that additional information must be provided to posted workers, such as:
- The country/countries that the employee will be posted at, and the duration
- The currency of salary
- Any cash or non-cash benefits related to the work assignments
- Whether the costs of the worker’s return to the country of origin are reimbursed and, if so, the conditions under which they are reimbursed, and the conditions for the worker’s return to the country of origin; and
- Whether any steps have been taken to obtain the necessary certificates in connection with the posting.
The Minimum Requirements
The new law also determines the following minimum requirements regarding the employee’s working conditions:
- The probationary period in employment cannot exceed six months. For fixed-term employment, the probationary period may not exceed a quarter of the employment period.
- Employers may not prevent an employee from taking up employment with another employer unless the employment is incompatible with the existing employment relationship.
- Employers may only require an employee with a wholly or mainly unpredictable work pattern to work if the work takes place within predetermined reference periods and the employee has been given notice of the work assignment.
- For employees employed on a call-out basis or similar exceeding three months, it will be presumed that these employees are employed for a fixed minimum number of paid hours equal to the work performed in the last 4 weeks, unless the employer proves otherwise.
- Employees can request another form of employment with more predictable and secure working conditions after 6 months of employment.
- If an employer is required by EU law, Danish law or collective legislation or collective agreements to offer training to an employee for the performance of the work in question, the training must be offered at no cost to the employee, count as working time, and as far as possible take place during the employee’s normal working hours.
What does this mean for you as an Employer?
Employees hired before 1 July 2023, do not have to obtain a new employment certificate or addendum, even if the employment certificate does not meet the employer’s disclosure obligation under the new law.
However, if the employee requests the missing information, the employer must provide such information within eight weeks of the employee’s request.
Our recommendation: Align standard contracts
We recommend and encourage all employers to adapt their Danish contract templates to the new rules. As the new rules will apply for new employments, it might also be beneficial to change existing contracts to the new standards in order to ensure smooth HR processes.
LEAD I Rödl & Partner’s employment law team can, among others, provide guidance and assistance in this regard. For further information on the Danish rules on employment and working conditions, don’t hesitate to contact us.
Your Labour Law Team
Last updated 15.06.2023