KEY DEVELOPMENTS FOR 2017
New Holiday Act
The EU commission has found the Danish Holiday Act is in violation of EU law. It is expected that the government will completely change the Act and the system governing holiday.
Data Protection Regulation
The Data Protection Regulation is expected to take up much attention during 2017 and 2018 for companies trying to prepare their compliance efforts Due to the high penalties under the Regulation, many companies need to take this much more seriously. For example, U.S. companies who have been more concerned about the SEC than the Danish Data Protection Agency (“DPA”), when doing internal investigations, whistleblower-hotlines, etc.
Even for those companies who have been compliant with current law, there are some new processes to implement such as reporting breaches within 72 hours, the use of consent and the requirement for DPA approvals, etc.
Making work more attractive
The Government is working on ways to make it more attractive to work. For example, there are plans to lower the income tax for top earners and efforts to lower unemployment benefits. There is also a new regime, which will make it easier to employ refugees on more basic terms of employment.
KEY DEVELOPMENTS FOR 2016
No automatic retirement
It is no longer possible to agree that the employee will automatically have to resign when the employee turns 70 years of age as this was deemed inconsistent with the general prohibition of age discrimination. In the future, a termination must be justified with the usual legal reasons such as the circumstances of the company or the conduct of the employee.
New rules on restrictive covenants
The law applies to employment agreements concluded on 1 January 2016 or thereafter and has introduced extensive changes to the previous system including reducing the employers’ ability to use non-compete and non-solicitation clauses. Furthermore, the new rules specify the maximum length of and minimum compensation paid for the restricted term.
A new law on the rules on taxation of share-based incentive plans for employees came into force in July 2016
There is a more favourable taxation of stocks received under employee stock purchase plans and rights to take up new shares in relation to share-based payment plans. If conditions are met, the employee will not be taxed at grant but instead when exercising. Furthermore, the tax will be calculated as taxation of shares instead of taxation of personal income.
New rules on reporting requirement for equal pay
The new law entered into force on 15 February 2016, and states that only companies with at least 35 employees, of which there are at least 10 of each sex, within the same work function shall report regarding equal pay.
With thanks to Anders Etgen Reitz of IUNO for his invaluable collaboration on this update.