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What you need to know if you lose your job in Denmark

It's never fun to lose your job, but the Danish Salaried Employees Act gives you a number of rights.

What you need to know if you lose your job in Denmark
Photo: IgorTishenko/Depositphotos

It can be quite nerve wracking when you hear that the company you work for has announced plans to review their overall strategy for the future. There are various kinds of business needs that could be the catalyst, such as financial hardships or pending mergers.

While it can sound like a good idea from a business point of view, it can also mean that there will be a restructuring, which may mean that some employees will lose their jobs.

Here is some general advice on how to handle these situations and how it works in Denmark. 

First of all, don’t panic

This is, of course, easier said than done, as it can be a very stressful time and there is often not enough communication around what will happen. But getting stressed out won’t help the situation at hand and could also negatively affect those around you.

Unfortunately, you will likely be waiting around for information to come, and there is nothing that you can directly do, to make that process faster. Here is some information that may help to ease the stress of the waiting period.   

Notice periods 

If you are covered by the Danish Salaried Employees Act (Funktionærloven), then you are entitled to certain notice periods before any significant change happens to the terms of your employment.

You can see in your contract whether you are a salaried employee (funktionær), but generally, the term applies to staff who have been employed for over 1 month and work more than 8 hours weekly, on average.

Sectors in which staff are considered funktionærer include business and administration, purchasing, selling and certain types of warehouse work, technical and cleaning services; and management and supervision.

Areas which may not be covered factory work or craftsmanship, not are people hired through temp agencies (Danish: vikarbureau) covered by the act.

The notice periods provided by the Salaried Employees Act cover things like notification of termination of employment or significant changes to your job duties. 

The amount of notice that you are entitled to is determined by how much seniority you have, as follows:

0-6 months of employment

1 month's notice

6 months to 3 years

3 months

3 years to 6 years

4 months

6 months to 3 years

3 months

6 years to 9 years

5 months

More than 9 years

6 months

It should be noted that when you receive notice of pending termination, it means that your employment officially ends at the end of the notice period. Your company will inform you as to whether or not you need to continue to fulfil your job duties for any part of your notice period. 

Seniority

When you have worked at the company for 12 or more years, you are also entitled to additional compensation (Danish: fratrædelsesgodtgørelse) if you are let go from your job, per the Danish Salaried Employees Act.  

The compensation is 1 month’s salary after 12 years’ employment and 3 months’ salary after 17 years of employment.

Additional payments

It is possible that your company will also provide other additional payments due to restructuring activities. This varies from company to company and is not part of the Danish Salaried Employees Act. 

What else should I keep in mind?

While all this is meant to reassure you that you will receive ample warning and some payments to cover your transition period, it is not meant to imply that that is the only factor that causes stress during a restructuring.

Many of us work because we enjoy our jobs and have plans for our careers, which can be suddenly thrown off course by these restructuring initiatives.

It’s also worth keeping in mind that, in general, the Danish labour market system is not primarily based on laws, as you may be used to from other countries, but on agreements and negotiations. You may have heard of the concept ‘the Danish model’ referred to in this regard.

A major characteristic of this model is that agreements are reached for employment terms through negotiations between trade unions and employer associations. In Danish, this is termed overenskomst, which translates to collective bargaining agreement.

A large proportion of people who work in Denmark are therefore a union members. Meanwhile, membership of an unemployment insurance service provider, an A-kasse, is the first step to keeping your income steady while you begin the process of finding new employment: a task the A-kasse itself can assist you with.

You can read more about both union and A-kasse membership in this article.

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Sources: Københavns kommune, HK, Work in Denmark

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