The Employment Contract
You should be aware of what is in your employment contract – always get our legal experts to review the contract before signing.
If your future employer has entered into a collective agreement with Finansforbundet (Financial Services Union Denmark), you are assured a number of rights that will constitute the basis of your employment contract. Among others, this includes the right to the 6th week of holiday, full pay during parental leave and up to five days’ absence when your child is sick. Therefore, this only leaves a few matters that you need to negotiate.
If you are or will be employed on an individual contract by an employer who has entered a collective agreement with Finansforbundet, you should be aware that you are generally not covered by the collective agreement.
However, if your future employer is not covered by a collective agreement, you must be particularly careful. In this case, only what has been agreed in the contract and the basic rights established in the Danish Holiday Act and the Danish Salaried Employees Act (if you are a salaried employee) will apply.
Everything you negotiate must always be specified in the contract, even if you are covered by a collective agreement between Finansforbundet and Finanssektorens Arbejdsgiverforening.
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What should you be particularly aware of?
The number of days you can stay home with full pay, and whether you can only stay home during the child’s first sick day(s) or at any time during the illness.
The general rule in Danish law is that you do not have a right to absence – either with or without pay - when your child is ill.
It should state whether you have the right to full pay during parental leave and for how long.
According to the Danish Salaried Employees Act:
- The mother has the right to take time off at half pay for four weeks before the expected birth and for 14 weeks after birth.
- The father has the right to take time off with unemployment benefits for two weeks in connection with birth. Father has no right to wages.
The contract should state whether you are covered by a non-solicitation or non-compete clause.
It is not an advantage for you to be subject to a clause – even if it only applies when you receive compensation. You should therefore try to get your employer to remove the clause or to limit it as much as possible.
If you suffer from an illness that could affect your ability to perform the job, you are obligated to disclose this before you are hired for a new job.
It should be specified whether you are entitled to paid sick leave if you are not covered by the Danish Salaried Employees Act.
If you are covered by the Danish Salaried Employees Act, you are entitled to paid sick leave.
It should state how much travel activity you should expect and how your travel expenses and any overtime will be paid.
If you are allowed to have special assignments or side jobs, it should state this in the employment contract. The procedure for having extra jobs approved should also be indicated.
The scope of the duty of confidentiality should be stated.
Typically, it will state that you may not share or use knowledge of the company that you acquired during your employment.
It should state in the contract whether it is agreed that you can get time off, with or without pay, for courses/supplementary training and whether your employer pays the costs.
Free car, free phone, agreement for working at home, health insurance etc. should be specified in the contract. You will be taxed in accordance with the applicable rules.
What is mandatory in the employment agreement?
There are a number of conditions that are standard in an employment agreement and must always be stated.
- Employer: Your employer’s name, address and information on the address of the place of work.
- Job description: The reason for your employment – i.e. your title, position or description of the job.
- Start and end date: When does the job commence. If you are employed in a time-limited contract, the end date must also be specified.
- Holiday, extra holiday entitlements and dependants’ leave: You have the right to five weeks of holiday a year. It must be specified if you also have the right to extra holiday entitlements (the sixth week of holiday) and dependants’ leave.
- Holiday bonus: The percentage for your holiday bonus. In the Danish Holiday Act, you have the right to a holiday bonus of one percent of the salary that you have earned in the last holiday year. The contract must specify if you have the right to a higher holiday bonus.
- Dismissal/resignation and trial period: The notice period for both you and your employer must be indicated. If it is not indicated, the applicable rules must be referenced instead. It must be clearly stated if you are to undergo a trial period.
- Salary: Your salary, time of payment and when you will be able to negotiate it.
- Pension: Your right to pension and what you and your employer pay in pension contribution.
- Working hours: Your weekly working hours are often 37 hours not including lunch. However, it can also be agreed that lunch is part of the working hours.
- Overtime: Whether your employer compensates overtime work with pay at a certain rate or whether you have the right to time off in lieu.
- Collective agreement or other agreements: The contract must state if the employment relationship is covered by a collective agreement or other agreements.
Have you signed - and regretted?
Once you have accepted a new job, you commit to a binding agreement. By principle, this means that you must show up on the first day, resign within the notice period that is stated in your contract, and work throughout your period of notice.
If you wish to try to avoid this situation, we recommend that you:
- Contact your employer as soon as possible to get the agreement cancelled
- Acknowledge the unfortunate situation
- Have a credible and concrete explanation for your opt-out
- Are prepared for how to deal with the deselected employer's possible overbids for you.