Agreement regarding extended notice period unenforcable

By Pia Skovgaard Hansen, Mia Boesen, Søren Narv Pedersen

10-2019

Although the salaried employee's notice of termination was extended by two months, The High Court of Western Denmark in its judgment of 28 June 2019 ruled that a salaried employee could not claim additional 2 months' salary during the notice period. The reason was that the employer's notice of termination was not extended accordingly and the agreement on the extended notice of termination was therefore unenforceable.

The circumstances of the case:

A was employed as a salaried employee in the company, V. As a part of A's salary negotiations, A's employment contract was changed so that A's termination notice, upon A's accept thereof, was extended from 1 to 3 months.

A was subsequently terminated by V with V's ordinary termination notice, which was 6 months to the end of a calendar month due to A's seniority in the company.

The High Court of Western Denmark would then have to decide if A in addition to being entitled to salary during the notice period of 6 months, also was entitled to further 2 months' salary, since the employer's notice of termination should have been prolonged accordingly with A's notice of termination.

The Court's comments:

According to section 2(6) of the Danish Salaried Employees Act, if an employee's termination notice is extended the employer's termination notice must be extended accordingly. If the employer's termination notice is not extended accordingly, the consequence will be that the agreement on the employee's extended notice of termination will not be unenforceable.

In this specific case, A's termination notice was extended by 2 months, and the employer's termination notice should therefore also have been extended by 2 months, from 6 months to 8 months.

It was neither agreed in the employment contract nor at the conclusion of the agreement that the employer's notice was extended by 2 months and the agreement on A's extended notice was therefore unenforceable.

A was therefore not entitled to receive a longer notice of termination from V, and A was therefore not entitled to salary during the notice period of the additional two months.

Bird & Bird's comments:

The judgment highlights that regardless of whether A through his employment has opted for a longer termination notice from both himself and from the employer, this is of no importance since extended notice agreements are only valid if both notices of termination are extended by the same period of time.

In this regard, Bird & Bird notes that as an employer it is important to ensure that the requirements of section 2 (6) of the Danish Salaried Employees' Act have been fulfilled, if an agreement on extended notice of termination is to be enforceable.