Talks between negotiators from Danish state, regional and municipal employers on one side and representatives for state employees on the other have resulted in the elusive agreement (Danish: overenskomst) required to avoid a labour conflict in the form of strikes and lockouts of public sector workers.
The industrial action would have has a severe effect on public services across the country, including healthcare, transport, education and the prison service.
But Saturday night's announcement of an agreement from official labour conciliation institute Forligsinstitutionen (FI) means new working terms for 750,000 public sector workers.
The key points of the deal were announced on Saturday evening.
For state employees, wage increases of 8.1 percent over the next three years were agreed. Paid lunch breaks, a key stumbling block throughout the negotiations, were also ‘guaranteed' by the agreement, although the exact details of this remain unclear, according to Politiken's report on Saturday.
A previous clause providing for state employees' wages to be matched closely to those in the public sector was also reintroduced.
Employees of Denmark's Regions – a state sector that encompasses much of the public health service – were also given 8.1 percent wage increases over three years, with the 6.1 percent providing ‘real' pay hikes and the other two percent being used for so-called ‘pools' for low earners and to ensure equal pay, Politiken writes.
500 million kroner (67 million euros) will also be spent on recruiting social workers and nurses.
Similar to the state agreement, matching of wages with the private sector is also provided for Regional employees.
Paid lunch breaks are agreed to various extents depending on the individual union groups with which settlement was reached: while academics were given the lunch break in return for 0.35 percent of the wage deal, the FTF and LO groups did not include lunch breaks in their agreements, but were given guarantees that their employees would not scrap existing breaks.
Other elements of the Region employees' agreement include those relating to leave for fertility treatment, child sickness and vacation.
Municipal employees agreed to similar wage increase, paid lunch break and private sector matching offers to their Regional counterparts, according to Politiken's report.
Municipally-employed teachers were not given a new agreement on working hours, an element that had formed part of demands. Instead, a commission has been established to investigate challenges and potential related to the current arrangement, according to the newspaper.
Minister for Public Sector Innovation Sophie Løhde, who represented the state in the negotiating process, told broadcaster DR on Sunday that she did not feel employers had been too generous in the final offer.
Løhde's response came after comments from the Confederation of Danish Employers (DA) suggesting that the price of the agreement was too high and could affect the competitiveness of private employers.
DA's CEO Jacob Holbraad told DR the 8.1 percent raise over three years was significantly higher than a 6.9 percent three-year pay rise agreed between authorities and private employers last year.
“There is a significantly higher level in the public sector agreements. That is concerning, because there is a risk of it affecting wage levels in the private sector, which could cause a loss of growth and jobs in Denmark,” Holbraad said.
But Løhde called the agreement, which will cost the Danish state 27 billion kroner (3.6 billion euros) according to DR's report, “economically viable”.
“We have come home with an overall good, and not least economically viable agreement. Furthermore, we have been able to bring calm to the public sector labour market by not only reaching an agreement with the state, but also Regions and municipalities,” she told the broadcaster.
Saturday's agreement between state employers and employees must be approved by members of signatory trade unions before becoming final.