Employing in Denmark

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Enter the Danish market without the requirement of opening a local entity.

Expanding into
Denmark

Expanding into Denmark and global expansion is a step for any business, regardless of your goal. The opportunities that can come with an expansion can be both incredibly exciting as well as intimidating and confusing, especially when you consider all of the registration procedures that need to be done and the documentation required.

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Expanding into Denmark – which is characterised by a highly motivated and productive workforce, flexible employment laws, strict tax laws, a resilient infrastructure network with leading sectors in agriculture, energy, tourism, and transport – can bring excitement to the possibilities, but also significant stress to ensuring the entity with the country’s rigid legal structures and laws.

Ensuring compliance without sufficient knowledge of the country’s laws also adds stress to getting your new entity off the ground and ready to test new markets. Going at it without the proper support can increase the costs, time and risks involved.

This can be worked through efficiently and cost-effectively with the support of an international Professional Employer Organisation (PEO) such as Bradford Jacobs, especially through our Employer of Record (EOR) framework.

This can be best utilised when businesses are just beginning their expansion process and require more information before committing to incorporating an entity and fully establishing themselves in that market.

Country EOR Guide - Bradford Jacobs

Download our Guide to Denmark

Learn all about expanding into Denmark and see what we can do to make your expansion easier.

Download our Guide to Denmark

Learn all about expanding into Denmark and see what we can do to make your expansion easier.

Country EOR Guide - Bradford Jacobs

Hiring Staff
in Denmark

Hiring Staff
in Denmark

The Main Sectors of the Danish Economy

The country focuses on the following key sectors, which all have a significant impact on the country’s economy:

This sector accounts for about 1.6% of Denmark’s total output. More than 60% of Denmark’s land is used for agricultural purposes, which allows the country to produce two times more than its national food requirements. Denmark has various food products for both domestic and export, including vegetables, seeds, grass, milk, meat, and other organic products. There are approximately 33,000 farms, with about 10,000 owned by full-time farmers. Agriculture also accounts for more than 20% of the total commodity exports in Denmark. The sector employs approximately 62,000 people in agriculture and horticulture and another 2,000 in fishing.
this sector is diverse and plays a vital role in the country’s economy. Coal power covers about 21% of the country’s total energy needs, crude oil approximately 33%, and natural gas back 18%. However, a good percentage of the country’s energy demand (about 27%) comes from renewable sources, including biomass solar energy, wind power, nuclear power, and geothermal energy. Denmark derives around 3.1% of its GDP from renewable energy technology and efficiency, which comes to about $9.4 billion.
The total output of manufacturing industries amounts to about 14,4% of the GDP and employs about 325,000 people, with amounts to about 12% of the workforce, according to 2016-2017 statistics. The main sub-industries are the manufacturing of pharmaceuticals, machinery, and food products.
This sector contributes around $125 billion of revenue to the country’s economy and employs around 79.9% of the country’s workforce. Denmark has a world-renowned reputation as one of the top travel destinations in the world, with several tourist attractions enticing millions of visitors to the country annually.
Denmark has made significant investments in this sector, developing a modern transport network of motorways and railways. The country’s infrastructure can be described as resilient and flexible, with next-day delivery to over 500 million consumers. It has three significant airports, serving more than 33 million passengers annually. The country also has several ports, which handle around 50 million passengers annually and more than 100 million tons of freight annually. Exports of goods and services account for about 54% of the country’s GDP and employ over 600,000 people.

The Main Sectors of the Danish Economy

The country focuses on the following key sectors, which all have a significant impact on the country’s economy:

Copenhagen light festival Børsen, Denmark
This sector accounts for about 1.6% of Denmark’s total output. More than 60% of Denmark’s land is used for agricultural purposes, which allows the country to produce two times more than its national food requirements. Denmark has various food products for both domestic and export, including vegetables, seeds, grass, milk, meat, and other organic products. There are approximately 33,000 farms, with about 10,000 owned by full-time farmers. Agriculture also accounts for more than 20% of the total commodity exports in Denmark. The sector employs approximately 62,000 people in agriculture and horticulture and another 2,000 in fishing.
this sector is diverse and plays a vital role in the country’s economy. Coal power covers about 21% of the country’s total energy needs, crude oil approximately 33%, and natural gas back 18%. However, a good percentage of the country’s energy demand (about 27%) comes from renewable sources, including biomass solar energy, wind power, nuclear power, and geothermal energy. Denmark derives around 3.1% of its GDP from renewable energy technology and efficiency, which comes to about $9.4 billion.
The total output of manufacturing industries amounts to about 14,4% of the GDP and employs about 325,000 people, with amounts to about 12% of the workforce, according to 2016-2017 statistics. The main sub-industries are the manufacturing of pharmaceuticals, machinery, and food products.
This sector contributes around $125 billion of revenue to the country’s economy and employs around 79.9% of the country’s workforce. Denmark has a world-renowned reputation as one of the top travel destinations in the world, with several tourist attractions enticing millions of visitors to the country annually.
Denmark has made significant investments in this sector, developing a modern transport network of motorways and railways. The country’s infrastructure can be described as resilient and flexible, with next-day delivery to over 500 million consumers. It has three significant airports, serving more than 33 million passengers annually. The country also has several ports, which handle around 50 million passengers annually and more than 100 million tons of freight annually. Exports of goods and services account for about 54% of the country’s GDP and employ over 600,000 people.

Commercial Laws in
Denmark

General requirements

In Denmark, employees working more than eight hours a week and having been employed for more than one month are entitled to receive a written employment contract containing all the essential elements and conditions of the role. It must be issued within one month of the starting work date.

The Danish Employment Contract Act requires that the contract include the following:

  • Full details of names and addresses of employer and employee; workplace location or primary location if more than one operating base
  • Job description, including employee’s title
  • Employment start date and duration, if not an open-ended contract, and terms of notice
  • Salary, payment schedule, any allowances or pension contributions
  • Working hours each week and any paid vacation entitlements
  • Identifying any collective agreements which affect the employment terms
  • Any proposed substantial changes to the contract must be provided to the employee on a timescale equal to their notice period, allowing them to agree or terminate the agreement.

Tax Authorities

The Danish Tax Agency – is an agency under the Ministry of Taxation. It helps ensure the collection of taxes, provides a steady flow of revenue to the public sector and provides solid tax rules and policies to ensure the efficiency of the tax administration system.

Labour Authorities

The Danish Working Environment Authority – ensures the occupational safety and health of employees in Denmark. This is done through work inspections, providing information to both employers and employees on this subject, as well as creating rules and policies on health and safety at work.

The Danish Agency for Labour Market & Recruitment – is responsible for implementing and following up on Denmark’s employment policy, which includes recruiting foreign labour. This agency also supports the Minister of Employment in policy formulation, legislation, and relations with the Danish Parliament.

Commercial Laws in
Denmark

Nyhavn with colorful facades of old houses in Copenhagen, Denmark

General requirements

In Denmark, employees working more than eight hours a week and having been employed for more than one month are entitled to receive a written employment contract containing all the essential elements and conditions of the role. It must be issued within one month of the starting work date.

The Danish Employment Contract Act requires that the contract include the following:

  • Full details of names and addresses of employer and employee; workplace location or primary location if more than one operating base
  • Job description, including employee’s title
  • Employment start date and duration, if not an open-ended contract, and terms of notice
  • Salary, payment schedule, any allowances or pension contributions
  • Working hours each week and any paid vacation entitlements
  • Identifying any collective agreements which affect the employment terms
  • Any proposed substantial changes to the contract must be provided to the employee on a timescale equal to their notice period, allowing them to agree or terminate the agreement.

Tax Authorities

The Danish Tax Agency – is an agency under the Ministry of Taxation. It helps ensure the collection of taxes, provides a steady flow of revenue to the public sector and provides solid tax rules and policies to ensure the efficiency of the tax administration system.

Labour Authorities

The Danish Working Environment Authority – ensures the occupational safety and health of employees in Denmark. This is done through work inspections, providing information to both employers and employees on this subject, as well as creating rules and policies on health and safety at work.

The Danish Agency for Labour Market & Recruitment – is responsible for implementing and following up on Denmark’s employment policy, which includes recruiting foreign labour. This agency also supports the Minister of Employment in policy formulation, legislation, and relations with the Danish Parliament.

FAQ

In Denmark, an Employer of Record (EOR) acts as the legal employer for a company’s workforce, handling all employment-related responsibilities like payroll and tax compliance. This allows companies to operate in Denmark without needing to set up a local entity, easing the process of international expansion.

To hire talent in Denmark, companies can use talent acquisition services that cover the entire recruitment process, ensuring alignment with local employment laws. These services facilitate the hiring process from engaging global talent to streamlining onboarding.

Managing payroll in Denmark can be efficiently handled by outsourcing to payroll service providers who ensure compliance with local tax laws and employment regulations. These services help streamline payroll processes, including tax filing and employee registration.

No, you do not necessarily need to establish a local entity to hire in Denmark. Companies can employ staff through an Employer of Record (EOR), which allows them to hire and manage payroll without the need to set up a subsidiary or other legal entity. This can be a faster and more flexible option for companies looking to enter the Danish market without the commitment of forming a permanent establishment.

FAQ

In Denmark, an Employer of Record (EOR) acts as the legal employer for a company’s workforce, handling all employment-related responsibilities like payroll and tax compliance. This allows companies to operate in Denmark without needing to set up a local entity, easing the process of international expansion.

To hire talent in Denmark, companies can use talent acquisition services that cover the entire recruitment process, ensuring alignment with local employment laws. These services facilitate the hiring process from engaging global talent to streamlining onboarding.

Managing payroll in Denmark can be efficiently handled by outsourcing to payroll service providers who ensure compliance with local tax laws and employment regulations. These services help streamline payroll processes, including tax filing and employee registration.

No, you do not necessarily need to establish a local entity to hire in Denmark. Companies can employ staff through an Employer of Record (EOR), which allows them to hire and manage payroll without the need to set up a subsidiary or other legal entity. This can be a faster and more flexible option for companies looking to enter the Danish market without the commitment of forming a permanent establishment.

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