Quick facts
Denmark, located in Northern Europe, is known for its high standard of living, progressive social policies, and a strong welfare system. The economy is primarily driven by services, industry, and agriculture, with Denmark being a leader in renewable energy. Its labor market is characterized by high wages, strong unions, and a flexible employment system, often referred to as "flexicurity".
In Denmark, most employment contracts are indefinite unless otherwise specified. Fixed-term contracts can only be renewed more than once if there is a justified reason. Employment relationships are typically formalized with clear written agreements, although verbal agreements are also legally binding.
There are no mandatory laws on probation periods, but it is common to agree upon a 3-month probation period. During this time, either party can terminate the contract with 14 days' notice. For employees recruited from outside the Capital Region, the employment contract usually includes a probationary period.
The standard workweek in Denmark is 37 hours, typically from Monday to Friday between 6:00 AM and 6:00 PM. Workers are entitled to a 30-minute lunch break, which may or may not be paid, depending on the employer. The EU Working Time Directive mandates at least 11 consecutive hours of rest per day and a 24-hour rest period per week. Weekly working hours should not exceed 48 hours, including overtime.
Employees in Denmark are entitled to 5 weeks of paid vacation per year, earned continuously from 1 September to 31 August. For every month of employment, employees earn 2.08 days of paid leave. If an employee hasn't worked a full calendar year, they still have the right to take vacation, though it may be unpaid.
Employees in Denmark are typically entitled to full pay during illness for a limited period. Employers are required to pay sick leave for the first 30 days of illness. The amount is calculated based on the employee’s average earnings over the past 3 months, with a maximum of DKK 4,460 per week. After this period, the local authorities may provide sickness benefits if the employee meets certain eligibility requirements.
Salaries in Denmark are generally paid on the last banking day of the month. There is no national minimum wage, but in 2022, most wages are around 110 DKK per hour (approximately $16.60 USD). Gross monthly salaries for full-time positions average 17,000 DKK (around $2,580 USD), although taxes can be quite high, sometimes exceeding 50%.
Denmark recognizes several public holidays, including:
Employers in Denmark contribute to social security through the following:
Taxation in Denmark is high. The income tax structure for 2022 includes:
Employees also contribute to ATP (Supplementary Pension): DKK 1,135.8 annually.
The notice period in Denmark depends on the length of employment:
Employees dismissed after 12 years of service are entitled to severance pay. The severance amount varies:
Additionally, employees with over 17 years of service may receive an extra three months' salary as compensation.
International EOR (Employer of Record) and PEO (Professional Employer Organization) are services that enable businesses to compliantly hire, manage, and pay employees in foreign countries without the need for establishing a legal entity. EOR acts as the legal employer while PEO co-employs workers, handling administrative tasks such as payroll, taxes, and benefits.
Acvian does not handle time record submissions directly. It is the client’s responsibility to track and submit employee work hours. However, Acvian can offer guidance and best practices to ensure efficient time tracking and compliance with local labor laws.
Employees can view their payroll details through the monthly payslips they receive and also via our Acvian platform. These payslips contain information on earnings, deductions, taxes, and net pay, giving employees a clear overview of their monthly payroll. Please note that in some countries, employers are restricted from viewing payslips due to data protection regulations, and only employees can share their payslips. For more details on these regulations, please contact our specialists.
Acvian addresses payroll disputes promptly, working closely with both the client and the employee to investigate and resolve any issues.
Yes, Acvian requires advanced monthly payments for salaries and service to ensure timely and accurate payroll processing.
Yes, Acvian can provide consultations regarding labor and tax legislation. Our team of experts is well-versed in local regulations and can offer guidance to help your business maintain compliance, reduce risk, and navigate the complexities of international employment and taxation laws.
Acvian provides a diverse range of benefits, including but not limited to:
We can customize and offer many kinds of benefits requested by the client, ensuring that your employees receive the support and perks that align with your company culture and local regulations.
Acvian can provide private health insurance options as part of its comprehensive employee benefits package.
The monthly/yearly costs for an ‘average’ package vary depending on the specific plan and location. See our estimated price packages here. Acvian’s team can provide detailed cost breakdowns based on your requirements.
While Acvian doesn’t directly provide entity set-up services, we can introduce you to local lawyers who specialize in this area to assist you with your needs. See also, when it's better to set the entity or use the EOR.
Offboarding is managed by Acvian in a structured and compliant manner. We coordinate with your business to ensure all necessary documentation, exit interviews, and final payments are completed. Acvian also ensures adherence to local labor laws and regulations, including providing any required notice periods and managing the termination process.
Businesses typically need EOR and PEO services when they:
Yes, Acvian is fully compliant with GDPR regulations. We collect and process personal data in accordance with the law, ensuring that data is used only for general, allowed purposes such as marketing and other legitimate business activities.
Acvian can supply EOR services in over 180 countries, encompassing almost all European nations, the United States, and Canada, providing extensive coverage to support your business’s global expansion and workforce management needs. See our coverage here.
Under EOR, Acvian manages the payroll process by:
Explore the details here.
Yes, Acvian provides comprehensive support for expatriate EOR workers, including:
Explore in details here.
Expats support from Acvian encompasses a range of services designed to facilitate a smooth transition for employees working abroad. Key aspects include:
After onboarding, Acvian maintains an ongoing relationship with your business and employees, ensuring smooth payroll processing, managing tax and regulatory compliance, handling benefits administration, and providing support for any changes or issues that may arise in the employment lifecycle. This allows you to focus on your core business operations while Acvian manages your international workforce.
The onboarding process typically takes between 2 to 4 weeks, depending on the country and complexity of the employee’s situation. However, Acvian strives to expedite this process, ensuring a smooth and efficient transition for your personnel. See our story of the urgent employment project.
Yes, Acvian provides in-country or regional support for employee inquiries and assistance requests. We have dedicated managers in the countries where we support your employees, ensuring prompt and knowledgeable assistance tailored to local regulations and practices.
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