Bill will secure more qualified labour to Denmark

By Mia Boesen, Pia Skovgaard Hansen

03-2019

The new bill on changes of the Danish Immigration Act contains multiple initiatives to ease the access for Danish companies to recruit qualified foreign labour.

On the basis of a proposal of October 2018, the government has on 6 February 2019 introduced a bill on changes of the Danish Immigration Act. The purpose of the bill is to ease the access for Danish companies to recruit qualified foreign labour. The bill contains multiple initiatives including a reduction of the amount in the "the Pay Limit scheme", an expansion of "the Positive List" and less restrictions on the "Fast-track scheme".

Reduction of the amount in the Pay Limit scheme

The pay limit scheme provides third country citizens who have been offered a well-paid job with an easy access to the Danish job market. In connection with the government's proposal from October 2018, we have written an article on the Pay Limit scheme, which you can read here.

As a general rule, under the Pay Limit scheme it is only the employee's salary which determines whether the employee meets the requirement under the scheme. With this new bill, the government wishes to establish a country-specific Pay Limit scheme, whereas the required annual minimum income is reduced from DKK 426,985.00 to DKK 350,000 in regards to applicants from third countries placed on a top 3o list of countries with the highest investment flow to and from Denmark. This is, among other countries, USA, Canada, Singapore and Japan.

With the new bill, the government wishes to support that Danish companies have access to the needed labour to compete with foreign companies. Furthermore, the government emphasizes, that the bill will advance investments in Denmark and will also advance Danish investments in foreign countries. 

Expansion of the Positive List

The Positive List is an outline of professions experiencing a shortage of qualified labour in Denmark. Labour from third countries who are offered employment in one of these professions can seek residence permit on the basis of the Positive List. The list is composed by The Danish Agency for International Recruitment and Integration ("SIRI") on the basis of a so called "labour law balance" providing information regarding employment opportunities and the need for labour in Denmark.

The current Positive List is criticized for not reflecting the actual need for work power on the labour market sufficiently. Furthermore, the list is criticized for focusing primarily on professions with a shortage of high qualified labour. With the expansion of the list, the government will secure topicality and a higher interaction with the demand from the Danish companies. Therefore, the government proposes that the Regional Labour Market Counsel – if the Counsel can reach an agreement – will be able to implement additional job titles to the list. The government furthermore suggests that the unemployment funds will have the same opportunity to supplement the list with additional job titles within their area.

With this bill, the government wishes to secure a more predictable list. In this current list, the different professions may be removed after 6 months, when the list is updated on 1 January and 1 July every year. This can have a great influence on the employers, as they – during a hiring process – can stake that one of the professions suddenly are removed from the list. Therefore, the government wants to secure that professions are removed from the list after a minimum period of two years at the earliest, which gives the employers a bigger predictability.

Fewer restrictions in the Fast-track scheme

The Fast-Track scheme provides certified companies with the possibility of recruiting foreign labour with special qualifications to Denmark.

Companies who are certified in accordance with the Danish Immigration Act under the Fast-track scheme are therefore able to offer foreign labours an easier way to achieve residence and work permit, as well as the foreign labour can start his/hers work before SIRI has issued a residence permit (provided that the applying fee is paid).

The current Fast-track scheme is criticized for being too restrictive. With the changes, the government wishes to secure a more smooth and balanced possibility to obtain the certification, as small and newly established companies also will have the opportunity to obtain the certification.

In accordance with the current Fast-track scheme, companies cannot obtain the certification, if they have been sanctioned with a fine of DKK 20,000 or more within a period of two years for using labours with no residence or work permit. With the new bill, the government wishes to decrease this suspension period from two to one year and increase the level of fines to avoid that companies are excluded from the Fast-track scheme because of small offences. Finally, the government wants to decrease the requirement for the companies to employ minimum 20 fulltime employees to minimum 5 fulltime employees, which will make it easier for small and newly established companies to obtain the certification.

Bird & Bird comments

The bill will entail that Danish companies will find it easier to attract more qualified workers to Denmark because of the reduction of the amount in the Pay Limit scheme, the expansion of the Positive List and the fewer restrictions in the Fast-tack scheme. If the bill is enacted, it is expected that especially the reduction of the amount in the Pay Limit scheme will entail a decrease in the amount of residence and work permits.

The bill is not yet enacted but in accordance with the time schedule, the bill was heard the first time on 21 February 2019. If the bill is enacted, it will come into force on 1 June 2019.

Bird & Bird has great experience in applying for residence and work permits and can assist you and the company in choosing which kind of permit to apply for. Furthermore, as an agent, we can assist with the actual application process.