Nordic Spotlight – The implementation of the temporary agency work directive causes difficulties in Denmark

14 Januar 2014

Søren Narv Pedersen

As of 1 July 2013, Denmark has implemented the EU directive on temporary agency work, thereby, to some extent changing the legal foundation for temporary agency workers.

Background:

Denmark often considers itself as having a quite liberal labor market – often described as the “flexicurity-model” with the possibility for employers to easily adapt the size of the workforce (the flexible part) on the one hand, with quite a high level of governmental unemployment support (the security part) on the other. In addition, a substantial part of employment regulation has traditionally been left to labor market parties to decide upon via collective bargaining agreements.

For historic reasons, politicians have to a large extent refrained from implementing regulation on the labor market that could be seen as an undue interference in matters that should be left to labor market parties to decide. For instance, the length of the notice period or compensation for unjust termination, is not regulated by law - except for so-called “salaried employees” (“white collar”-employees), where the regulation is found in the Danish Salaried Employees’ Act.[i] For non-salaried employees (“blue collar”-employees), no mandatory legislation on the length of notice of termination or compensation for unjust termination exists. Accordingly such terms should be included in either the individual’s employment agreement or be found in the relevant collective bargaining agreement (if applicable).

Salaried employees

Amongst other rights, the Danish Salaried Employees’ Act[ii] provides a right to full pay during sickness and also a (mandatory) right to a proportionate part of bonus in case of termination/resignation[iii], but does otherwise not regulate the size of the salary[iv], which is subject to separate agreement between the parties. The Danish Supreme Court[v] held in a 1997-judgment[vi] that temporary agency workers are not salaried employees covered by the Danish Salaried Employees’ Act, the reason being that temporary agency workers are not under the control of the temp agency, which is their formal employer. For this reason, temporary agency workers are not by law entitled to for instance salary during sickness or at least not until now.

The implementation of the temporary agency work directive[vii]

However, as of 1 July 2013, Denmark implemented the directive into Danish law under the Danish Act on temporary agency work[viii]. Under the Act[ix], the temporary work-agency is obliged to ensure that the temporary agency worker while assigned to the user undertaking, is granted the same rights as if employed directly by the user undertaking, in respect of the following elements: a) the length of the working hours, b) overtime work, c) breaks and rest periods, d) night time work, e) vacation, f) (national) holidays, and g) remuneration.

Especially the last element (remuneration) is a new edition. From the preparatory work[x] to the Act, it appears that the term “remuneration” is to be interpreted widely, and should thus also cover the right to salary during sickness derived from the Danish Salaried Employees’ Act, as if the temporary agency worker were a salaried employee[xi] employed directly by the user undertaking. So, by the implementation of the EU directive on temporary agency work and the equal treatment element, temporary agency workers are now to a large extent accorded the same protection as salaried employees in general, provided that the work is “white collar”-work.

Further the user undertaking is now subject to various obligations under the Act. In section 5 and 6 of the Act, the user undertaking is, amongst other things, obliged to procure that the temporary agency worker is informed of any relevant vacant positions within the user undertaking, thereby allowing the temporary agency worker to apply for such positions. The user undertaking is also obliged to ensure that the temporary agency worker is granted the same access to collective benefits at the workplace, for instance canteen, daycare and transportation facilities as the user undertaking’s own employees.

Summary

With the implementation of the EU directive on temporary agency work, temporary agency workers have had their legal position strengthened and in reality, the implementation has resulted in the Danish Salaried Employees’ Act to a large extent becoming applicable to temporary agency workers conducting “white collar”-work. The implementation also means that user undertakings should establish procedures to ensure that they adhere to the new obligations towards the temporary agency workers, including procedures that ensure that temporary agency workers are informed of vacant positions. Based on this, it is fair to say that the implementation has had a profound impact on the legal status of temporary agency workers.

 


[i] An essentially updated translation into English can be found here: http://uk.bm.dk/Legislations/~/media/BEM/Files/English/Acts/ConsolidationAct68.ashx

The Danish Salaried employees’ Act was implemented  in 1938. The historic reason for implementing mandatory provisions for salaried employees only, is that blue collar employees at that time were thought of as having acquired adequate protection pursuant to collective bargaining agreements, whereas salaried employees at that time were basically unprotected  without applicable collective bargaining agreements in place.

[ii] Section 5

[iii] Section 17a

[iv] No legal minimum wage applies. Collective Bargaining Agreements often contain provisions on minimum wages, though.

[vi] UfR 1997.1495H

[vii] Directive 2008/104

[viii] L no. 595 of 12 June 2013.

[ix] Section 3 of the Act.

[x] LSF 209/2012

[xi] That will be the case if the work carried out is “white collar”-work, cf. section 1 of the Danish Salaried Employees’ Act.

Autor

Søren Narv Pedersen

Partner
Dänemark

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