HR & Labor
No minimum wage
Private pension plans are very common, the average employer contribution can reach 15% of the pensionable salary. The pensionable earnings are calculated on the monthly base salary of January × 12/24.
The severance payment is 1 month’s salary if the employee has been in the company for at least 12 years but less than 15 years. Payment of 2 months’ salary if the employee has been in the company for 15 years but less than 18 years. And three months’ salary if they been in the company for over 18 years.
Under the labor law in Denmark, salaried employees are entitled to a notice period of 1-6 months, depending on the length of employment.
Employees are given from 1 month to 6 months notice depending on the length of their employment in the company.
First 14 days of the employee’s sick leave is paid by the employer. After the first 14 days, the state pays the sick leave. During leave, employees receive 90% of their salary with a maximum of DKK 3,016.
There are 11 public holidays.
Employees are entitled to 5 weeks each full calendar year (25 days).
Salary is paid in 12/24 instalments. Special holiday allowance accounts for the additional 0.24 as it is paid at a rate of 2%.
Maternity leave of 4 before birth and 14 weeks after birth
Parental leave of 2 weeks before birth and 14 weeks after birth
Parents are entitled to receive 52 weeks of of paid parental leave. This time can be extended by either 8 or 14 weeks, however this will decrease the amount of parental allowance received monthly. One of the parents may choose to defer between 8 to 13 weeks of leave which can be kept for a continuous period before the child is one years old.
Danish social security is modest compared to most other countries, contribution are made both by employee and employer.
The average employer contributions are approximately EUR 2,000 per year per full-time employee.
The annual cost for the employee is DKK 1,080 , this amount is withheld by the employer.
Expats in Denmark are entitled to special tax rate of 32% for the first 5 years of living there. In order to qualify for the special tax rate, the employee’s monthly salary should be minimum DKK 69,300 after deductions. The employee may not have a role in the management of the company or have 25% or more of the shares in the five years prior to the employment start. Also the employee must have not worked in the company in three years before moving to Denmark or one year after the previous employment in Denmark with tax liability. Lastly the expat can't be a previous tax resident in Denmark or have been taxed in Denmark in the past 10 years.
VAT is 25% standard rate.