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Employee Termination Procedures & Guidelines in Denmark

While termination procedures are straightforward in Denmark, there are a few statutory rules for salaried employees.

The process includes following the notice period, having a reasonable justification for termination (if the employee has been with the company more than a year) and, if applicable, compensating the employee.

Employers have the right to terminate an employment contract due to:

Unjustified terminations by the employer can lead to employee compensation.

A written notice is not required but strongly encouraged for documentation purposes. Sufficient reasoning for termination must be provided in writing if required by the employee.

Depending on the length of the employment, the employer needs to give the following notice periods to the employee:

Employees need to give employers one month notice when resigning.

Gross misconduct from either the employer or the employee entitles the other side to end the employment contract without any notice.

There is no general statutory rule for compensation when ending the employment relationship. When there is one, it's usually mandated by collective agreements and mostly benefits salaried employees. The standard rules are:

At the termination of employment, the employer is required to pay any outstanding holiday leave to the employee's holiday fund.

In addition, salaried employees are entitled to a severance pay corresponding to 1-month salary if the employee has been employed in 12-17 years. If the employee has been working for more than 17 years, the severance pay will be three months of salary.

Blue-collar employees

In Denmark, there is no general protection for unjustified termination for blue-collar employees unless this is agreed in the employment contract or through a collective bargaining agreement. In turn, there is no general regulation on the length of the notice periods for blue-collar employees unless agreed in a collective bargaining agreement.

Procedure guidelines

Before terminating an employee based on their performance, misconduct or cooperation issues, the employer must follow a procedure that allows the employee to improve before ceasing employment. If the employer doesn't follow the guidelines, the termination can be considered unjustified and can lead to employee compensation.

The employer must first give a written warning to the employee containing:

Employees have the right to bring a union representative to the meeting. Employers must inform the union representative of the warning within two days of the meeting.

If the conduct or performance of the employee doesn't improve, employers may terminate the employment following the required notice periods.

Unfair Dismissal in Denmark

Employee protection

All employees are protected from unfair dismissal for the following reasons:

Dismissal not considered reasonably justified by the conduct of the employee or company circumstances may entail compensation to the employee. Salaried employees with less than 12 months seniority are not protected from unjustified termination. Therefore they are not entitled to compensation unless the dismissal is reasoned in one of the bullet points above.

For employees having worked for at least 12 months, compensation cannot exceed their salary for half of the notice period. Compensation may amount up to three months' salary for employees over 30 years of age, four months' salary for employees with at least ten years of service or six months' salary for employees with at least 15 years of service.

Redundancy Pay & Entitlement in Denmark

Collective dismissal

Dismissal is considered to be collective when the company, in a period of 30 days, lets go of 10 employees (companies with 21 to 99 workers); 10% out of 100 to 299 workers; or 30 employees if there are more than 300 workers in the company.

Before proceeding with dismissal, the employer must consult the trade union representative, consider alternatives to dismissal, and notify both the government and the union.

There is no specific statutory redundancy payment for collective dismissal.

Redundancy Pay

For service of 12 to 17 years, employees are entitled to a redundancy pay of 1-3 months' salary respectively. Employees might be entitled to contractual redundancy pay under their employment contracts or collective bargaining agreement.

Resignation Procedure in Denmark

Employees who would like to resign have to do so in writing and give their employers a one month's notice and work until the end of the month they are leaving. This means that if an employee resigns in March, they are expected to work throughout March and April.

Employees resigning before the end of the probationary period need to give one day's notice. Some contracts might state more extended periods, such as 14 days, which must be respected.

Other End of Employment Regulations in Denmark

Notice period

Employers must give one month's notice to employees who have been with the company for less than six months. For employees working for more than six months, the notice period is three months.

After three years of employment, the notice period becomes four months and is extended by one month for every additional 3-year period of work, for a maximum of 6 months' notice.

Pay instead of notice is allowed, but not a common practice in Denmark.


Employees who have worked continuously for the same company for 12-17 years are entitled to severance pay corresponding to 1-month salary (3 months' salary for those who worked for more than 17 years). Some collective bargaining agreements include severance pay based on seniority.

Holiday Leave in Denmark

Denmark rolled out a new holiday act on September 1, 2020, changing the holiday year to run from September 1 to August 31. Employees are entitled to 5 weeks' paid leave (25 days), of which three can be used consecutively between May 1 and September 30. Employees earn 2.08 paid holidays for every month worked and can spend them in the same holiday year or no later than December 30 in the following year.

Regardless of how many paid vacation days someone has accrued, everyone has the right to take up to 5 weeks' holiday per holiday year.

Public holidays

Denmark Public Holiday Calendar 2022

1/1/2022SaturdayNew Year's Day
14/4/2022ThursdayMaundy Thursday
15/4/2022FridayGood Friday
18/4/2022MondayEaster Monday
13/5/2022FridayGeneral Prayer Day
26/5/2022ThursdayAscension Day
27/5/2022FridayBank Holiday
5/6/2022SundayPentecost Sunday
5/6/2022SundayConstitution Day*
6/6/2022MondayWhit Monday
24/12/2022SaturdayChristmas Eve**
25/12/2022SundayChristmas Day
26/12/2022MondaySecond Day of Christmas

*Observance. Government holiday, optional for the private sector.
**Not a public holiday, but most private companies understand it as a public holiday.

Holidays falling on the weekend do not transfer to the next working day.

Types of Leave in Denmark

Sick leave

Employees are entitled to full salary during sickness from the employer without limitations.

After 30 days of sickness, the employer can be reimbursed by the municipality, if the employee is entitled to sickness benefits. To be eligible, the employee must:

Sickness benefits are calculated based on the employee's salary. The maximum amount of sickness benefits is currently (2020) DKK 4,405 a week or DKK 119.05 an hour.

Maternity leave

Women are entitled to 4 weeks' leave before giving birth, and 14 weeks' after (of which the first two weeks are mandatory). Mothers are entitled to 50% of their salary during that whole time.

Paternity leave

Men are entitled to 2 weeks' paternity leave, which they must take during the first 14 weeks following the birth or adoption. The father is entitled to maternity pay from the municipality during the paternity leave.

Adoption leave

Adoptive parents are entitled a 4-week leave before the child is put under their care. The leave can be extended with extra four weeks if there is a delay, which is not due to the adoptive parents' circumstances. After the receipt of the child, the parents are entitled to two weeks leave together with the child.

After that, the parents are entitled to 14 weeks leave in total, which they have to take one at a time.

Throughout the leave, the parents are entitled to maternity pay.

After the 14 weeks, the parents are entitled to parental leave (and pay) as described below.   

Parental leave

As long as both parents are working in Denmark, they are entitled to 32 weeks paid parental leave. It is possible to extend the leave by an additional eight or 14 weeks, however, the pay remains the same and will be spread to cover the extra weeks, decreasing the weekly amount. 

Employed parents have the right to postpone 8-13 weeks of the parental leave, which only one parent at a time can do. The postponed parental leave must be taken in one continuous period before the child turns nine years old.

Employed parents can also agree with their employer to postpone the entire parental leave, which again needs to be taken before the child turns nine years old.

Bereavement leave

There's no statutory bereavement leave. Any pay or leave is at the employer's discretion.

Force majeure leave

Employees are entitled to unpaid leave as a result of a relative's illness or accident.

Carer's leave

Employees have the right to time off to care for a close relative who is dying, is seriously ill or disabled. The government is responsible for carer's leave pay during such leave.

If employers have already paid the employee's salary for the month, they can be reimbursed by the government equivalent to the allowance.

General Employee Pay Regulations in Denmark

Minimum wage

There's no minimum wage in Denmark for areas not covered by a collective bargaining agreement.

Most of the public sectors jobs involve a collective bargaining agreement, which usually stipulates the minimum wage. The average minimum wage across different sectors ruled by the collective bargaining agreements is DKK 110 per hour.

Collective bargaining agreements also cover some private sectors, such as the construction and hospitality industry. A collective bargaining agreement does not cover the majority of salaried employees.




Vary from the last day of the month to the 15th of the following month. 

Maximum Working Hours & Overtime Laws in Denmark

Standard hours

There are no statutory rules on the number of standard working hours in Denmark. As a general rule, working hours are mandated through a collective agreement (if any), or the employment contract. The majority of sectors have 37 hours weekly.

Usual working hours are Monday to Friday, from 8 or 9 AM to 4 or 5 PM. Lunch breaks are 30 minutes to 1 hour per day and usually are not included in the calculation of weekly working hours.

Maximum hours

Over the course of four months, an average working week should not exceed 48 hours.

It is possible to opt-out of the maximum hours only if the collective agreement complies with the Working Time Directive.

Overtime compensation

Overtime pay depends on collective bargaining agreements (CBA). If there isn't one, then no statutory rule applies. Typically, the CBA overtime pay is 50% for the first 3 hours and 100% for subsequent hours. In some cases, employees can choose between receiving payment and having time off in lieu of payment. 

If an employee works on a public holiday, they are entitled to receive a pay bonus of 100% of their average salary.

Sunday working

The regulation on Sunday work varies between industries and the collective bargaining agreement in place, but usually, employees are compensated between 50 to 100% of their daily pay.

If a collective bargaining agreement does not cover the employees, no other legislation regulates it.

Break rights

Employees are entitled to an uninterrupted rest period of at least 11 hours for every 24 hours and at least one day rest per week.

No more than six workdays are allowed between two rest days.

Night workers

A night worker cannot work more than 8 hours in a 24-hour period on average over four months.

Time Tracking Obligations in Denmark

Only a few sectors have regulations on time tracking, such as oil and gas industries. Some companies have time-reporting systems in place not to ensure staff turns up on time, but to manage the working hours and ease the process of paying out salaries.

On May 14 2019, the European Court of Justice (ECJ) created a law that requires employers in every EU member country to set up an objective, reliable and accessible system to time track employees' working hours. The implementation of such systems and the form they take is up to the member states to determine. The objective is to control how many employees work overtime and the state of their health, and to make sure they are paid accordingly, while not exceeding the maximum hours worked. 

 This, in most cases, won't be an issue in Denmark.

The employer may leave the time-tracking to the employee. However, if an employer notices that this does not work, steps must be taken to intervene.


Time tracking can lead to hefty fines and even prison (this would require extensive abuse) in cases of employer abuse, where employers do not comply with the requirements in the Danish Working Environment Act.

As for the new ECJ ruling, it remains to be seen whether further and stricter sanctions will be imposed in future if a working time recording system is not introduced.

Working from Home Policy in Denmark

Employers should provide employees working from home equipment, such as a computer, cellphone and internet connection. The company must ensure that employees have a place to work from home and do not have any additional expenses due to their work from home.

The Danish working environment regulations apply to work from home, and the employer should inform employees that the Danish working environment regulation applies. In turn, the employee must acknowledge and comply with this. Employers are also advised to inspect the home offices of employees to ensure compliance with the working environment regulation.

Health & safety at home

Employers are advised to add health and safety at home regulations in the company's internal handbook. Employers should instruct the employees about health and safety matters related to remote work. Employees working with a display screen should take breaks regularly to rest their eyes.

Workspace Guidelines in Denmark

Employees must care for their health and safety and follow any reasonable policies or directions their employer gives them. They should inform employers of any work-related incidents or injuries that occur while working remotely.

An appropriate workstation will include the following:

Working conditions

Recommendations for employees working remotely:

Terms & Conditions of Employment in Denmark

Probation period

There's no statutory probation period in Denmark. Typically employers include a three month probation period with a 14 days notice.

General Employee Rights in Denmark

Employment agreement

Employees are entitled to an employment contract within the first seven days after they start work. It should state all relevant employment conditions, such as name and address of both employer and employee, remuneration, job description, date of commencement, notice period, duration of employment (if unlimited, this must be stated), working hours and location, and paid vacation. Further, it should communicate any information on collective agreements.

Employees who do not receive an employment contract addressing the mentioned employment conditions are entitled to tax-free compensation.

Employers can make small changes to the employment contract as long as they provide the employee with a short notice of 14 days. For significant changes such as salary, work description, working hours and location, the employer must give notice corresponding to the employee's notice period. Such changes are seen as a dismissal and a simultaneous new employment offer. What this means is that if the employee does not accept the new terms, they will be considered dismissed. This carries its own set of risks such as unjustified dismissal compensation.

The employer and employee can agree to make changes effective immediately or within the short notice period. This includes both insignificant and significant changes.


Employees have the right to receive their payslip either online or a paper copy monthly with a breakdown of salary and all deductions.

Health & Safety

It is the responsibility of the employer to ensure that working conditions are safe and sound, and it's the responsibility of the employee to cooperate on those. Employers must:

The company's workplace assessment must also include home offices.

If a company has 10-34 employees, it must create a work environment organisation to collaborate on health and safety and have one or more health and safety representatives. One or more managers should also join the organisation.

If a company has more than 35 employees, the work environment organisation should be on two levels. Level one is in charge of the day to day tasks in regards to health and safety and consist of a health and safety representative elected by the employees and a manager. Level two handles more general tasks and consists of members (one representative and one manager) from level one.

Health and safety representatives are entitled and obliged to participate in the safety organisation's work and are protected against unfair dismissal in the same way as union representatives are.

Home Offices

Cooperation between employer and employee is crucial when work is performed from home because, unlike work offices, the employer does not have control over the working conditions.

The home office must be appropriate for the employee getting work done at the environment. They must have proper lighting and place the computer screen, as to avoid glare. Screens should be adjustable and be kept away from windows that create glare and direct sunlight.

For employees working on the computer, the following rules apply:

Flexible working

In Denmark, many employees are entitled to start and leave work earlier or later as long as they cover the regular daily hours. Most collective agreements will have their specific flextime regulations (usually not applicable to salaried employees).

Equal opportunity & pay

The Danish Act on Equal Treatment to men and women and the Danish Act on Equal Pay to men and women requires that every business treats women and men equally at work, and pays them equally for work of equal value. Employers cannot favour one gender over the other for a job promotion nor pay one gender more than the other for the same job.

Employee Protections in Denmark

Protection from discrimination

Danish laws prohibit direct and indirect discrimination based on:

Individuals are protected against discrimination during all stages of the employment process and are entitled to compensation.  

Protection against dismissal

Employees are protected from unfair dismissal for the following reasons:

Employees that are covered by the Danish Salaried Employees Act, have superior protection against dismissal after 12 months of employment. For them, dismissal not considered reasonably justified by the conduct of the employee or company circumstances may entitle them to compensation.

Before dismissing an employee due to performance, the employer must give the employee a written warning and a chance to improve performance before proceeding with dismissal. This is to ensure documentation on the lack of performance and to minimise the risk of a potential claim.

Protection in case of business transfer

Employees have the right to be informed and, to some extent, consulted by their employers in cases of business transfer. The employees are generally obliged to accept the change of employer unless the shift means the conditions of employment are diminished.

When the business transfer occurs, the employee and their employment contract are automatically transferred to the new business owner, with all the rights and obligations under the contract prevailing. If the new business is part of collective agreements, but the employee doesn't want to become part of it, they must notify the relevant trade union within certain time limits.

A business transfer is not a valid reason for dismissing employees, but employees can be dismissed in case of economic, technical or organisational reasons due to changes in the workforce.

Personal information protection

Under the GDPR rules, employers are subject to restrictions when retrieving and disclosing employee data.

Required Employee Benefits in Denmark

Unpaid time off

Employees are entitled to 25 paid days off per "holiday year" which starts on 1 September and ends on 31 August the following calendar year. If an employee is hired during that period, they are still entitled to 25 days off, however only the ones they have accrued are paid. The rest are unpaid, and in fact, the employer can deduct 4.8% of monthly salary for each day taken. The same rule applies for force majeure leave as a result of a relative's illness or accident. Unless otherwise agreed, the employer can deduct that same percentage for each day taken. 

Redundancy payment

Collective redundancies happen when within 30 days, the employer dismisses:

In the case of mass redundancies, employers must give employees and their representative an appropriate notice. The employer has to first consult with employees to decrease the number of redundancies or avoid it altogether. They must provide information about the employees affected by the mass redundancies and consult with works councils.

If they fail to do so, trade unions can assist employees with making claims. If a claim is successful, the employer may have to pay a fine.

Employees are entitled to redundancy pay if they have been continuously employed with the same employer for at least 12 years. In such a case, the severance pay - which is payable in addition to the salary during the notice period - will amount to one month's payment. After 17 years of service, the amount is three months' pay.

To learn about all statutory benefits, as well as how leading employers top that, download our Denmark benefits benchmark infographic.

Job Security in Denmark

Union membership

Employees have the right to join a trade union or association and they are protected against discrimination for being part of them. Trade unions can assist in case of disputes over pay and working conditions of their members. Employees are free to join whichever union they'd like, and employers are prohibited from demanding information on membership.

Under the Danish Information and Consultation of Employees Act, employees are entitled to discuss changes with the employer and the employer must consult with the employee representative, but the employer is not required to accommodate the employees’ wishes.

Mandatory Employee Benefits in Denmark

According to the Danish Working Environmental Act, the employer is obliged to ensure that employees can carry out the work safely and correctly. This means that the employer must ensure that the employees have the necessary equipment to carry out the work, including a computer, mobile phone, internet etc.

Furthermore, if the employee has any expenses to carry out the work, the employer must refund these.

If the employee is allowed to use company-paid equipment (e.g. computer, internet and mobile phone) for private purposes, please note that this is taxable with approx. DKK 242 per month.    

Non-Mandatory Employee Benefits in Denmark

The most common non-mandatory benefits in Denmark.

Additional annual leave

Some companies give employees an extra week of paid annual leave.

Private pension fund

Private pension plans are a standard benefit in Denmark, which the employer and the employee contribute both to (on average 6%-10% of salary). Since public pensions are relatively small, offering a private pension adding it to the salary package makes employers more competitive.

Career development allowance

Some tech companies offer employees a set allowance for developing their skills as well as days off to study.

Flexible working hours

Most tech companies offer flexibility to employees, to choose what hours they want to work and have better work and life balance.

Hardware and phone

Most tech companies provide hires with various equipment.


Some tech companies offer paid massages to help employees who spend the day in front of the computer.


Depending on the employee's position, some companies offer a bonus based on KPIs.


Some companies give employees free medical insurance.

Learn more about benefits in Denmark

Employer Contributions in Denmark

Danish employers withhold Danish taxes and make labour market contributions (AM-bidrag) when paying salaries to employees.

Social security

The Danish social security system is financed mainly through revenue coming from taxes. Employees and employers make minimal contributions to social security. Employer contributions to a full-time employee in Denmark are between DKK 8,000 - 10,000 a year.

Social Security encompasses the following contributions:

Occupational injury insurance

The insurance costs vary between DKK 1,176 and DKK 24,441 depending on the field of work that the insured employee is employed within, the number of employees that the employer intends to insure and the specific insurance company. The insurance must be made with a private insurance company.

Employee Contributions in Denmark

A person is considered a Danish tax-resident if they:

Danish tax residents are subject to Danish income tax on their worldwide income. Individuals pay tax on income after the deductions have been subtracted.

Social security

The Danish social security system is financed mainly through revenue coming from taxes. Employees and employers make minimal contributions to social security. The social security contributions that employees pay are deducted by their employer from their gross earnings, before deducting income tax. Employees make the following contributions to social security:

Income tax

The income tax rate is progressive and includes state, municipality and church taxes.

Danish income tax 2021

DKK 0 - 46,7008%
DKK 46,701 - 544,80040%
Over DKK 544,80056.5%

The table above is based on an average municipality tax rate and includes voluntary church tax, which is on average 0.7%. The marginal tax rate varies by +/- 1-2 percentage points depending on the municipality. The marginal tax rate calculation includes the taxable value of a mandatory employment allowance, which is maximum DKK 40,600 for employed individuals.

The marginal tax rate cannot be more than 52.06%. However, labour market tax, share tax, property value tax, and church tax do not fall under this rule and combined can make the tax go above the 52.7% threshold.

Municipal tax

Municipal tax rates vary, but the average tax rate for 2020 is approximately 24.95%.

State Tax

The state tax increases according to the level of income as follows:

Voluntary Church Tax

The Church tax, which is not mandatory is a flat rate, which varies for each municipality. The country average is around 0.9%.  Municipalities impose it and only charge members of the Danish Lutheran Church. When registering in Denmark, all individuals should explicitly state if they will fall under this rule.

Share tax

The tax for shares income (up to DKK 56,500 for individuals and DKK 110,600 for married couples) is 27%. For any sums beyond that threshold, the tax is 42%.


Benefits in kind extended to employees are taxed at market value as income. That is, however, generally only if the combined value exceeds DKK 1,200 (trivial fringe benefits) and DKK 6,300 (work-related benefits).

Typical benefits provided in Denmark include:

Work-related benefits are taxed when the combined value during one income year exceeds DKK 6,500. Examples are:

Expat tax regime

Denmark offers a special expatriate tax regime to high-level foreign earners (scientists, specialists and researches). The tax rate is 27% plus labour market contributions, for a total of 32.84% gross tax on their cash remuneration, as well as the taxable value of a company car, a company paid telephone and health care insurance. All other income, including additional benefits, is taxed at ordinary tax rates and there are no tax deductions in place.

Expats can avail of this expat tax regime for up to seven years in total. Some of the requirements to fall under this tax regime include:

Tax-Free Allowance in Denmark

Family allowance

Individuals with one or more children residing in Denmark are entitled to a family allowance. Also known as Child and Youth benefit, Danish residents do not need to apply for it, and the government automatically pays it. However, individuals who are EU/EEA citizens and working in Denmark are not entered into the system automatically and have to apply for the benefit.

To receive the benefit, the individual must:

In addition, the child should not be supported by the public or be married.

The amount received depends on the child's age:

The amount of the benefit also depends on the parent's income. If it exceeds DKK 800,100, 2% of the excess is deducted from the total allowance.

Personal allowance

Employed individuals are entitled to an annual personal allowance of DKK 46,500 that is tax-free after paying the 8% AM-ta. The unused personal allowance is transferable between spouses.

Employment allowance

There is a variety of expenses that employed individuals can claim as tax deductions. However, the current rate of the allowance is 10.50% of the person's salary and cannot exceed DKK 39,400. The maximum allowance will be raised over the next years. Below are the eligible expenses:

Transport Deductions

Employees who travel more than 24 km round trip to their workplace and do not have a company car are eligible to claim tax deductions. The exact amount is calculated by taking the number of workdays, and the distance travelled. The individual has to make the calculation and include it on their income tax return.

The deduction is DKK 1.96 (changing to DKK 1.90 in 2021) for 25 to 120 km and DKK 0.98 (changing to DKK 0.95 in 2021) per km exceeding 120. For individuals that live in certain outskirts, the allowance is still DKK 1.96 (changing to DKK 1.90 in 2021) even for distances beyond 120 km.

Employees are entitled to extra mileage allowance for using the Øresund connection (the bridge and tunnel between Denmark and Sweden) and the Storebælts link (the bridge and tunnel between Funen and Sealand). The allowance amount, in this case, depends on the means of transport.

Travel Allowance

Employees can deduct travel expenses related to work trips in two different ways:

  1. Claim costs as a business expense and get it reimbursed by the employer
  2. Make deductions when determining taxable income

The maximum allowance is DKK 28,600 per year. It applies to both the deduction of standard rate and actual expenses. However, it does not affect an employer's ability to pay tax-free allowances, reimburse the employee's costs, or provide them with food and lodging.

Allowances or deductions can either be based on actual documented expenses or the standard rate per day for meals and other miscellaneous costs (DKK 521) and lodging (DKK 223).

Other employment-related allowances

Under certain circumstances, expenses related to the performance of work, such as work clothes, may be deductible from taxable income if they exceed the basic amount of DKK 6,300.

Charitable contributions

Donations to certain approved charities, foundations, and institutions are tax deductible, up to DKK 16,600 a year, regardless if the contributions are to one charity or spread among several ones. 

Interest expenses

Interest expenses are deductible from capital gains income, generally deducted in the year in which they fall due. However, penalty interest paid in connection with late taxes is non-deductible. 


kr. Danish Krone / DKK
37 hours / week. Regulated by collective agreements
11 days per year
1.1 million
108 DKK
1st Jan - 31st Dec
Penalties range from DKK 10,000 to 20 weeks' salary to employees.
UN's World Happiness Report ranks Denmark in second place (2020)
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