The Danish government has - as part of the government's legislative programme for 2014/2015 - introduced a number of bills that has lead to changes in the labor and employment law.
Two of the most important changes are described briefly below:
The Danish Salaried Employees Act (DSEA)
The Danish parliament has introduced a significant change regarding severance pay to salaried employees.
Pursuant to the former section 2a of the DSEA, an employee whose contract was terminated by the employer was entitled to 1, 2 or 3 month's severance pay if the employee had been employed for respectively 12, 15 or 18 years. However, this was not the case if the employee could receive state pension or similar private pension.
The new bill has changed the seniority requirement. Pursuant to the bill, salaried employees will accrue a right to one or three month's salary if they have been employed with the same company 12 or 17 years respectively at the last date of the notice.
Furthermore, for the purpose of ensuring compliance with EU case law, the severance pay is owed disregarding whether the employee can retire with or without pension.
The amendments entered into force on 1 February 2015.
The Anti-discrimination Act
Until now, it has been allowed to terminate a contract automatically when the employee turned 70 years if this was agreed in the employment contract. With the new bill, the Anti-discrimination Act prohibits such an agreement. Thus, it will no longer be possible to validly enter into agreement - neither individually and nor collective - according to which an employment contract automatically expires due to the fact that the employee turns 70 years.
The government adopted the bill on 18 December 2014.
With the new bill, all individual agreements which entail a section on retirement age will be void. This also goes for agreements entered into before 18 December 2014. Thus, employers must ensure to update employment contracts so these are in compliance with the rules.
With regards to collective agreements, if will not be possible to enter into new collective agreements with such sections after 18 December 2014. Agreements which have already been entered into will become void as of 1 January 2016.
Please contact Søren Narv Pedersen or Mia Boesen.