COVID-19: Raise of maximum compensation amount under the salary compensation scheme in Denmark

Published

Mar 30 2020

Written By

Senior Associate
Denmark

I'm an associate in our international HR Services group in Denmark specialising in labour and employment law issues, both nationally and internationally.

Søren Narv Pedersen

Partner
Denmark

I'm a partner and head of our international HR Services group in Denmark and a member of our international Trade Secrets Protection group. I've spent over 20 years specialising in labour and employment law, court and arbitration cases, trade secrets, company law and M&A.

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On 30 March 2020, the labour market parties submitted a proposal for amendments to the salary compensation scheme entailing that the maximum compensation level under the salary compensation scheme is raised to DKK 30,000 per month for all types of employees.

Amendments to the scheme

Negotiations between the labour market parties and the government have resulted in an agreement to improve the scheme for the companies so that the maximum compensation amount to apply for is raised from DKK 23,000 per month for salaried employees and from DKK 26,000 for employees not covered by the Danish Salaried Employees Act, respectively, to DKK 30,000 per month for both salaried employees and employees not covered by the act.

However, the companies may still only receive up to 75% of the gross salary for monthly paid employees and 90% of the gross salary for employees not covered by the act.

Almost 40,000 persons have registered as unemployed the last two weeks despite the fact that almost 11,000 companies have applied for salary compensation under the scheme. The amendments aim to render the salary compensation scheme more lucrative for employers, who will hopefully maintain thousands of jobs.

Read our newsletter for further details of the salary compensation scheme here.