How to hire in Denmark through an EOR

Denmark requires a written contract for anyone working more than three hours per week on average. Skip it, and you risk disputes where courts will typically assume terms in the employee's favor.

Most companies go with indefinite contracts around 90% of the time. They're simpler, sidestep renewal complications, and fit well with Denmark's flexible labor market, where collective agreements set the standards.

What has to be in the contract

You must provide a written statement no later than one month after the start date, if employment exceeds one month and averages over eight hours weekly. From July 2023, that threshold drops to three hours weekly on average over four weeks.

The law requires these details:

• Employer and employee names and addresses
• Workplace or main office
• Job title, description, and category
• Start date (and end date for fixed-term contracts)
• Salary, pay frequency, and bonuses
• Working hours and shifts
• Holiday rights (at least 25 days)
• Notice periods
• Probation terms
• Reference to any applicable collective agreement

There's no official language requirement, but Danish is standard. English is fine for multinationals if both parties agree. Collective agreements often fill in the gaps on pay, hours, and pensions.

Probation (prøvetid) is common and can run up to three months for salaried staff. Notice periods are shorter during this time. You can end employment early with minimal notice, but make sure it's clearly stated in the contract.

Contractor vs. employee

Denmark looks at how the work actually operates, not what you call it. The key questions: do you control how, when, and where someone works? Do they use your tools? Do they get fixed pay? If the answer is yes, they're likely an employee in the eyes of the law.

Misclassify someone, and courts can reclassify them retroactively. You'll owe back taxes, social security contributions (up to 8% employer contribution), holiday pay, and pension. Tax authority fines can reach thousands of euros per case, and the employee can sue for unpaid benefits and damages. In the worst cases, full employment protections apply going back to day one.

Non-competes are only enforceable if they're reasonable. Keep them to six months post-termination, tie them to protecting genuine business interests, and compensate the employee at least 50% of their prior salary during the restriction period. Courts will strike down anything too broad.

IP assignment needs to be spelled out explicitly in the contract. Employees own their inventions by default unless you agree otherwise. For software or design work, especially in tech roles, make sure ownership is addressed upfront.

Denmark gives employees five weeks of paid annual leave from day one. That's 25 days for full-time workers, accruing at 2.08 days per month, and they can use it as it builds.

Time off

Full-time employees get 25 days of paid annual leave each year, accruing at 2.08 days per month starting in their first month. The holiday year runs September 1 to August 31, with until December 31 of the following year to use any remaining days.

This means new hires don't have to wait a full year before taking time off. Employers also pay a 12.5% holiday allowance on top of salary, often held in a fund like FerieKonto and paid out before leave starts.

Denmark has 10-12 public holidays a year depending on the calendar. If they fall on a workday, they're paid and employees get the day off.

All leave types

Here's what the law requires for the main leave types. For family leave, pay comes from the state via Udbetaling Danmark. For sick leave, the employer covers the first 30 days, then the municipality takes over. Job protection applies across all leave types.

To qualify for parental leave, employees need 160 hours worked in the last four months. It's flexible but must be taken before the child turns 9. Sick pay starts with full employer pay for 30 days, then the state covers most of it at around 80%.

Mandatory benefits

Denmark's social security system covers health, unemployment, and pension through ATP (arbejdsmarkedets tillægspension). Employers contribute automatically as part of the payroll process.

There are no unusual mandates like meal vouchers or transport subsidies. Public healthcare is free at the point of use, funded through taxes. Unemployment insurance is opt-in via an a-kasse, with employer withholding but no direct employer contribution.

What people actually expect

The legal minimums are solid, but they're not always enough to stay competitive. Many collective agreements add a sixth week of leave, particularly in private sector and public roles.

Private health insurance is worth considering if you want to offer faster access to specialists, since public wait times can stretch into months. Tech and knowledge workers often expect remote work support too, including home office stipends of around DKK 2,000-5,000 per year.

Danes take work-life balance seriously, so flexible hours, the option to buy extra leave, and wellness perks like gym memberships do make a difference in attracting good people. Aiming for 30 days total leave puts you in line with what most employers in the market are offering.

Firing someone in Denmark gets complicated after the first year. Once an employee hits 12 months, they can challenge a dismissal as unfair, and you'll need to show it was justified or risk a compensation claim.

Firing someone

Denmark runs on a flexicurity model, which means it's employee-friendly, especially for longer-tenured staff. You can end employment with proper notice and without giving a reason, as long as the decision isn't discriminatory. But after 12 months under the Salaried Employees Act (or 9 months under many collective agreements), employees gain protection against dismissal without just cause.

Valid grounds include restructuring, financial difficulties, lack of trust or cooperation, job unfitness, contract breaches like serious misconduct or theft, or extended sick leave over 120 days in 12 months. For conduct issues, you'll need to issue a written warning first. It should detail the problem, what needs to change, the steps required, a timeline, and the risk of termination if things don't improve.

Unfair dismissal covers terminations without just cause or those based on protected characteristics: race, skin color, national or social origin, genetics, disability, age (if unjustified), pregnancy, maternity or paternity leave, union activity, or sexual orientation. Summary dismissal is only valid for gross misconduct. Always give written notice with proof of receipt. Employees can request written reasons for their dismissal, and disputes go to labor courts, where unions often handle claims.

Probation makes things simpler. Salaried employees can have a probation period of up to 3 months, with 14 days' notice from either side. Non-salaried employees have no set limits unless their agreement specifies otherwise.

Notice periods

Notice periods depend on tenure and are set by the Salaried Employees Act or collective agreements, which often align. Employees give 1 month regardless of how long they've been with you. During the notice period, you need to let them work and pay their full salary.

Severance

Denmark doesn't have broad statutory severance. It only kicks in for specific situations, like employees aged 50 or older with 12 or more years of service, who are entitled to 1 to 3 months' salary on dismissal. Courts can also award compensation for unfair dismissal. Collective agreements often go further, adding tenure and age-based payments, so it's worth checking what applies to your situation.

Everyone is entitled to pay for unused vacation, calculated at 12.5% of earnings in the accrual period. Restructuring or economic dismissals may trigger additional payments through negotiation or agreements. There's no general cap, but amounts are tied to salary and length of service.

Work permits and visas

You can hire foreign nationals through an EOR. The EOR acts as the local legal entity and sponsors work permits on your behalf. Denmark doesn't have a digital nomad visa, so everyone needs work authorization to be employed there.

The main routes are: the Pay Limit Scheme (for high-skill roles with a salary above DKK 465,000/year, roughly €62,500, with a fast-track option of around 10 days); the Positive List (shortage occupations including IT, engineering, and health); the STEM scheme; and the Researcher scheme. EU, EEA, and Swiss citizens can work freely with registration.

You'll generally need a job offer, matching qualifications, and a salary that meets the relevant threshold. The EOR handles sponsorship and applications through SIRI (the Danish Agency for International Recruitment). Processing times run 1 to 4 weeks for fast-track schemes and 1 to 3 months for standard applications. Extensions are possible if conditions are still met, and family reunification is available once a permit is in place.

A few other things worth knowing

GDPR applies fully in Denmark, so data protection compliance isn't optional. You'll also need to withhold income tax, labor market contributions, and ATP pension contributions, with monthly registration required with tax authorities. An EOR handles all of this for you.

Around 67% of workers in Denmark are covered by trade unions. Collective bargaining agreements often set better terms on pay, hours, and notice periods, and they're binding where the sector applies. A good EOR will know which agreements cover your employees.

Post-termination restrictions are enforceable but come with compensation requirements. Non-compete clauses can run up to 12 months, with 55% salary compensation for the first 3 months and 35% after that. Non-solicitation clauses follow the same structure. If you combine them, the maximum is 6 months at 60% salary. Compensation is paid upfront for the first 2 months and can be offset by other income, though floors apply.

A few changes to watch: the EU Pay Transparency Directive is due by June 2026 and will introduce pay audits, gap reporting, and new transparency rules. Since 2023, employees have had expanded rights to information about their terms, including hours and probation. Posted workers staying over 12 months (extendable to 18) are entitled to fuller host-country protections. It's worth reviewing your contracts now if you haven't already.