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New draft bill aims to ensure better working conditions for posted employees

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Legal news
calendar 27 September 2020
globus Denmark

The Ministry of Employment has just sent a new draft bill into hearing, which contains significant changes to posted employees’ working conditions. The new draft bill will implement the revised posting of workers directive and is expected to enter into force 1. January 2021.

The long-awaited draft bill will change the existing posting regulations significantly to increase equal treatment for posted employees in relation to the pay and working conditions that they are covered by. Therefore, the new regulations will have a significant impact on the posted employees as well as companies.

If the draft bill is adopted in its current form, it will lead to several changes, including:

  • The list of “the hard core” conditions, that protect posted employees, will expand to include accommodation and allowances or reimbursement of expenses to cover travel, accommodation and food and an appropriate advance for such expenses.

  • A new maximum time period establishes that employees posted for longer than 12 months (with possibility of prolongation to 18 months) hereinafter will be included by further working conditions in addition to “the hard core”.

  • Companies can prolong the maximum time period to 18 months by noticing RUT latest the day the employee has been posted for 12 months. The notice-criteria is a formality and does not require approval.

  • Companies that replace a posted employee with another employee to carry out the same tasks at the same place should be aware that each posting will be calculated as one collective period.

  • The word ‘minimum wage’ is changed to “pay” to increase equality by ensuring the posted employees the same pay as national employees. The requirement for equal treatment still only extents to existing legislation and collective bargaining agreements that the company has signed up to. Companies without collective bargaining agreements will therefore not be required to apply industrial collective bargaining agreements adopted by the most representative unions. And likewise, minimum wage will not be implemented by law in Denmark with these new rules. To ensure companies an overview of what should be featured in “pay”, more detailed information will be published on workplacedenmark.dk.

  • User undertakings, where employees are posted through a temp agency must notify the agency about the pay- and working conditions, the employee will be entitled to.

The deadline for implementation of the revised posting of workers directive was 30 July 2020.

The Ministry of Employment expects the new regulations to be in force on 1 January 2021. The regulations will have retroactive effect, as the current postings from 30 July 2020 onwards will count in the collective posting period, if the posted employee carries out the same tasks at the same place when the new regulations enter into force.

IUNO’s opinion

The changes in the new draft bill will have a significant impact on the posted employees’ rights regarding their employment terms. Therefore, IUNO recommends that companies already now get acquainted with the new regulations and how they will affect existing postings which will continue after the 1 January 2021.

The draft bill is still only at the hearing phase. We will follow the development closely and return as soon as there are new developments.

The long-awaited draft bill will change the existing posting regulations significantly to increase equal treatment for posted employees in relation to the pay and working conditions that they are covered by. Therefore, the new regulations will have a significant impact on the posted employees as well as companies.

If the draft bill is adopted in its current form, it will lead to several changes, including:

  • The list of “the hard core” conditions, that protect posted employees, will expand to include accommodation and allowances or reimbursement of expenses to cover travel, accommodation and food and an appropriate advance for such expenses.

  • A new maximum time period establishes that employees posted for longer than 12 months (with possibility of prolongation to 18 months) hereinafter will be included by further working conditions in addition to “the hard core”.

  • Companies can prolong the maximum time period to 18 months by noticing RUT latest the day the employee has been posted for 12 months. The notice-criteria is a formality and does not require approval.

  • Companies that replace a posted employee with another employee to carry out the same tasks at the same place should be aware that each posting will be calculated as one collective period.

  • The word ‘minimum wage’ is changed to “pay” to increase equality by ensuring the posted employees the same pay as national employees. The requirement for equal treatment still only extents to existing legislation and collective bargaining agreements that the company has signed up to. Companies without collective bargaining agreements will therefore not be required to apply industrial collective bargaining agreements adopted by the most representative unions. And likewise, minimum wage will not be implemented by law in Denmark with these new rules. To ensure companies an overview of what should be featured in “pay”, more detailed information will be published on workplacedenmark.dk.

  • User undertakings, where employees are posted through a temp agency must notify the agency about the pay- and working conditions, the employee will be entitled to.

The deadline for implementation of the revised posting of workers directive was 30 July 2020.

The Ministry of Employment expects the new regulations to be in force on 1 January 2021. The regulations will have retroactive effect, as the current postings from 30 July 2020 onwards will count in the collective posting period, if the posted employee carries out the same tasks at the same place when the new regulations enter into force.

IUNO’s opinion

The changes in the new draft bill will have a significant impact on the posted employees’ rights regarding their employment terms. Therefore, IUNO recommends that companies already now get acquainted with the new regulations and how they will affect existing postings which will continue after the 1 January 2021.

The draft bill is still only at the hearing phase. We will follow the development closely and return as soon as there are new developments.

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Anders

Etgen Reitz

Partner

Søren

Hessellund Klausen

Partner

Kirsten

Astrup

Associate

Nina

Kumari

Associate

Cecillie

Cathrine Groth Henriksen

Associate

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