In the following article, we look at entitlement to bonuses during childbirth-related leave, from a Danish perspective.
By: Sara Baldus
Firm: Norrbom Vinding
EU Directive 2006/54 is implemented into Danish law by the Danish Act on Equal Treatment of Men and Women. In conformity with the Directive, the Act prohibits direct as well as indirect discrimination.
From a Danish law perspective, a bonus is considered part of an employee’s remuneration and for this reason any bonus entitlement follows from an employee’s entitlement to receive a salary. Thus, if an employee on childbirth-related leave is entitled (e.g. under their employment contract or a collective agreement) to receive their full salary during part of the childbirth-related leave, it will generally constitute unlawful gender discrimination to cut off the employee’s bonus based on the fact that they are not present in the workplace.
The situation will, however, be different if the employee on childbirth-related leave is not entitled to receive his or her full salary during (part of) the leave.
Neither Danish law nor the applicable EU legislation provides for any entitlement to salary for employees on childbirth-related leave (article 11 of the Pregnancy Directive 92/85/EEC provides for ‘an adequate allowance’, but not necessarily a salary). This has been confirmed in case law from the European Court of Justice (C-342/93 Gillespieand C-411/96 Boyle) and was further confirmed by the Danish Supreme Court in 2014(case 248/2012, UfR 2015.649 H). On this basis, it could be concluded that under Danish law an employee who is not entitled to pay during childbirth-related leave is not entitled to receive a bonus during that leave either.
Employees might also (e.g. under an applicable collective agreement, individual contract or provision in a staff handbook) be entitled to receive part of their salary, for example, the base salary only, during childbirth-related leave. In this situation, the employee will only be entitled to receive a bonus during childbirth-related leave to the extent that the bonus entitlement follows from the applicable collective agreement, staff handbook provision or individual contract.
Under the Danish Salaried Employees Act, female employees are entitled to receive 50% of their total remuneration (including bonus) during maternity leave. Accordingly, during this part of the leave, the employee will be entitled to receive 50% of the bonus that she would have received had she been working.
It should be stressed that an employee on childbirth-related leave cannot be deprived of any rights accrued before the leave began, such as rights relating to length of service, pay level or bonus. Thus, if, for instance, a pay raise or bonus that has already been earned is forfeited due to childbirth-related leave, this is likely to constitute either direct or indirect gender discrimination, depending on the circumstances.