Understanding Employment Norms in Denmark: A Comprehensive Guide
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Hiring in Denmark? Read on to find out the employment norms (like taxes, payroll and benefits) and EOR (Employer on Record) norms in Denmark.

Social Security

Denmark is a European country with flexible employment norms like other European countries. Flexible employment norms in Denmark make it a desirable working place. It has over 50% of its population that works in different sectors.
These working sectors are broadly divided into white-collared jobs, blue-collared jobs, and managers and self-employed. Rules and regulations apply to all these sectors. The rules here are made of collective agreement among trade unions and European Union.

General Information:

  • The Denmark currency is Danish Krone (DKK).
  • Copenhagen is the capital of Denmark.
  • Danish is the official language of Denmark. Documentation can be done in Danish.
  • As of 2021, the GDP of Denmark was reported to be 39,830.33 billion USD. An officially estimated GDP of 2022 is 348 Billion USD.
Denmark is a favorable country for expanding a business. Companies that are looking to hire people in Denmark must follow the employment norms laid down by the authorities.
Denmark map

Table of Contents

  • Agreements
  • Onboarding Process
  • Visa
  • Minimum Wage
  • Payroll Cycle
  • Annual Bonus
  • Health Benefits
  • Working Hours and Overtime
  • Leaves
  • Social Security
  • Taxes for Employers
  • Taxes for Employees
  • Probation
  • Termination
  • Severance Pay
  • Employees or Contractors
  • Final Words


  • An employer is mandated to provide a written contract within a month of hiring a candidate. A verbal contract is considered to be equally binding.
  • The language of the contract is not bound to be in any definite language. Translation of the contract is provided if asked by an employee.
  • The agreement is legally binding. It must contain all details of both the employer and the employee.
  • The agreement must be clear about the type of job, requirements of the job, and type of the contract. Benefits, termination, notice, or any collaboration with a trade union should be mentioned.
  • Before entering a contract, a company must get a Central Business Registration (CBR) number from the Danish Business Authority (DBA).
  • Employers need to register with the Danish Customs and Tax Administration (SKAT). This is a necessary step before cutting taxes on the employees' salaries.
  • All employers in Denmark must have industrial insurance.
  • Every employer must contribute to the Danish Labor Market Supplementary Fund (ATP).
  • Any contract comes under the Danish Employment Contract Act.
Onboarding Process

Onboarding Process

The hiring process in Denmark is like any other country
  • The first step of the hiring process is preparing the description of the job. This is done together by the HR team.
  • The description is uploaded on the company's site or hiring portals like LinkedIn.
  • People seeking a job start to fill out the application form. Applications are reviewed by the HR team.
  • Candidates are shortlisted by the HR team. They are further assessed in other rounds after initial shortlisting.
  • The background of the final few candidates is checked.
  • The last step includes the negotiation of the working norms.


Denmark has four types of visas:
  • Short stay visa-This visa is valid for up to 90 days. These are tourism and visiting visas.
  • Business visa- To get this visa you need to prove that you are visiting the country for business-related things. You also need to disclose the duration of your stay.It is granted for up to 90 days.
  • Long-stay visa- It is granted for up to 5 years. The visa holder must continuously stay 90 days out of every 180 days in Denmark.
  • Work Visa- It is not needed by European citizens but by other nationalities. It is valid for up to 4 years. It is generally applied or sponsored by the employer on behalf of the employee.

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Minimum Wage

Minimum Wage

Denmark does not have a legally fixed minimum wage. Wages are collectively dependent on the type of work. The national collective bargaining agreements between the employer and worker union set the minimum wages in Denmark. The average minimum salary on an hourly basis is 110 DKK, across both the public as well as private sectors.
Payroll Cycle

Payroll Cycle

The payroll cycle in Denmark is dependent on the type of work. Several factors influence the payroll cycle. The payroll is monthly, employees are paid by the end of the month.
Annual Bonus

Annual Bonus

The annual bonus is dependent on the performance of employees. There is no provision for annual bonuses in Denmark. Employees performing well may get an annual bonus.
Health Benefits

Health Benefits

  • Health benefits in Denmark are determined by joint bodies of employers or employees.
  • The structure of health benefits is usually decided by the size of the company. Larger companies provide two tiers of health benefits. Smaller companies provide one-tier.
  • Employees get dental, health, and vision insurance. Mental health support is also provided to employees.
Working Hours and Overtime

Working Hours and Overtime

  • Work hours:An employee needs to work a fixed 37.5 hours per week and 7.5 hours per day. People generally work from Monday to Friday.
  • Break: An unpaid break is granted for working longer than 6 hours a day. It may be around 30 mins or so. At least 11 hours of the rest period is provided daily.
  • Overtime: Denmark does not have any specific law for overtime pay. If there is any, then the employer mentions the same in the agreement.


Sick Leave

  • Employees get the full pay if they are availing the sick leave. In such cases, employers should request sick pay for their employee, if the employee is sick for 30 days and more.

Parental leaves

  • Parents can take leave of 32 weeks and this leave can be extended to 46 weeks maximum.

Maternity leaves

  • A pregnant female employee is entitled to 18 weeks of maternity leave in Denmark.
  • 4 weeks of maternity leave is granted before the birth of the child. 14 weeks of maternity leave is granted after childbirth.
  • During maternity leave, 50% salary is given to the female employee.

Paternity leave

  • Fathers get paternity leave of 2 weeks before the child's birth and after the birth of the child, they get a leave of 14 weeks. Though the father does not have a statutory right to any salary Danish authorities might pay the leave benefits.

Statutory Leave

  • The full-time employees get paid holidays of 5 weeks under the Holiday Act.

Annual leaves

  • 25 days of annual leave is given to employees. These leaves exclude public holidays.

Other leaves

  • Adoption leave: 4 weeks of leave is granted to an employee before the adoption.
  • Care leave: Employees can avail of this leave to take care of their sick child.
  • Illness, accident, and family bereavement leave: This is the unpaid leave granted if someone in the employee's family is sick or has met an accident.

Public Holidays (for the Calendar year 2023)

  • New Year's Day (1st January)
  • Maundy Thursday (06 April)
  • Good Friday (07 April)
  • Easter Sunday (09 April)
  • Easter Monday (10 April)
  • Great Day of Prayer (05 May)
  • Ascension Day (18 May)
  • Whit Sunday (28 May)
  • Whit Monday (29 May)
  • Christmas Day (25 December)
  • Boxing Day (26 December)

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Social Security

Social Security

Social security is provided to employees in Denmark. It is given to employees working for up to 2 years.
Taxes for Employers

Taxes for Employers

  • Employer's Reimbursement System (AUB) - DKK 2,791
  • Danish Labour Market Supplementary Pension Scheme (ATP) - DKK 2,272
  • Occupational injury insurance - DKK 1,176
  • Maternity or Paternity leave fund - DKK 1,150
  • Financing for ATP contributions for the unemployed (FIB)- DKK 592
  • Labour Market Insurance (AES)- DKK 299
  • Securing payment for foreign workers in Denmark (AFU)- DKK 12

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Taxes for Employees

Taxes for Employees

  • Danish Labour Market Supplementary Pension Scheme (ATP) - 1136 DKK
  • 8% to be paid on any kind of self-employment or from the employment.
  • Tax for the income 46,201 - 513,399 is 12.14%.
  • Above 513,399 the tax will be 15%.
  • The average municipal tax for all income is 24.954%.


The probation period in Denmark is not fixed legally. The probationary period may range between one month to three months. The duration can be negotiated between employers and employees.

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At-will termination for employers is not possible in Denmark. Termination can happen:
  • If an employee opts for voluntary termination
  • Termination by mutual agreement
  • By employer unilaterally based on objective grounds, unsuitability for the job probation period, etc.
  • If the contract gets expired.
Severance Pay

Severance Pay

There are no rules on severance pay in Denmark. It is only granted in a few cases. An employee is granted severance pay if working for the same company for over 12 to 17 years.
Employees or Contractors

Employees or Contractors

  • A person who works for a company and gets paid is called an employee.
  • An organization or company that hires employees is the employer.
  • An employer may have to pay DKK 10,000 or above for the misclassification of an employee as a contractor.
  • An employer may have to pay 20 weeks of salary as a penalty if found guilty of grave misclassification.
  • Compensation for a non-complete agreement is also paid to the employee.
  • The misclassified employee will get a notice period under the Danish Salaried Employees Act.
  • The employer may have to pay all legal benefits retrospectively to such a misclassified employee.
  • The employer may have to pay all taxes and other contributions on behalf of the employee.
Final Words

Final Words

Denmark is a country with liberal employment rules making it a preferable choice for businesses. Companies seeking to expand their business outreach in Denmark must follow the rules. As a part of the European Union, businesses can avail of various opportunities to expand and flourish here.

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