Minimum Wage & Payment Requirements in Denmark | Boundless EOR (2024)

FAQs

Minimum Wage & Payment Requirements in Denmark | Boundless EOR? ›

In Denmark, there is no statutory minimum wage, meaning there's no legally mandated minimum hourly or salaried amount set by the government. However, this doesn't imply a complete absence of minimum wage structures for employees.

There is no mandatory minimum pay in Denmark. The pay is typically governed by collective agreements for different types of work. For some types of work the pay will depend on the amount the worker must be paid, for example per hour. In other areas, the pay may have been agreed upon in other ways.

There is no statutory minimum wage in Denmark. Pay rates for blue-collar and white-collar workers are set through collective bargaining agreements. An agreement may set actual pay rates or minimum pay rates at the industry level.

Payroll requirements

Although there is no statutory regulation on the payroll frequency, most employers choose to run their payroll once a month. Payments to employees must be made in the local currency which is the Danish Krone (DKK). It is illegal to pay salaries to Danish employees to foreign bank accounts.

The average minimum monthly salary in Denmark is about US$3,300 (DKK 22,600) per month. CBAs establish minimum wages for about 84% of the Danish workforce, including most employees in the public sector and certain private industries, such as construction and hospitality.

Break rights. Employees are entitled to an uninterrupted rest period of at least 11 hours for every 24 hours and at least one day rest per week.

The average salary in Denmark is between DKK 20,000 and 40,000 per month, or approximately PLN 12,000 to 25,000. The minimum Danish salary for workers without language skills or relevant qualifications is around DKK 13,000 per month, or about PLN 10,000 gross per month.

In Denmark, employees enjoy some of the highest average wages in the world, reflecting both the country's high standard of living and its strong economy. The Danish labor market is characterized by a well-developed collective bargaining system, which ensures employees are compensated fairly for their work.

Minimum wage Denmark

That being the case, there are some instances where unions in some fields will negotiate a set hourly wage. There are also collective work agreements for some trades. Workers in Denmark are suggesting that a wage of 120-135 Kr (€16-18) per hour is common for low skilled part-time jobs.

Why does Denmark not have a minimum wage? ›

Wages and working conditions are based on collectively-negotiated agreements, and the government rarely interferes. For example, there is no legal minimum wage in Denmark. Instead, the relatively high wages are set as part of the regular negotiations between the employers and labour unions.

Denmark offers a special tax regime to highly paid inbound expatriates and researchers recruited from abroad. Employees may elect to be taxed at a rate of 27 % on employment income and other cash allowances, for up to 84 months.

Labour Market Contributions: Also known as AM-bidrag, it covers employees in the event of unemployment, sickness, and expenses for training and activation. The contribution is 8% of the employee's salary. This tax is deducted from their gross salary before any other taxes are calculated.

The average employee in Denmark earns DKK 46,972 per month before taxes. The amount includes pension and is calculated by the so-called standardised hourly earnings translated to a full-time monthly salary. In 2022, Danes had a median net worth of DKK 701,429 after subtracting liabilities from assets.

Costs of renting (per month)

A room for a single person in a shared flat costs between DKK 4,000 to DKK 6,000. Small studios or apartments (1-2 rooms + kitchen and bathroom) are highly in demand. They can be rented to a single person or a couple without children and cost between DKK 8,000 to DKK 10,000.

How much bank balance is required for a Denmark student visa? As proof of funds for your study in Denmark you need to have at least around 6,000 DKK. Or a minimum of 600 DKK per month conditioned on proof of tuition fee payment for your first semester of the course.

Companies can now offer foreign candidates from outside the EU three- year employment contracts paying 375,000 kroner per year (€50,414), instead of the previous level of 448,0 kroner (€60,229), provided the employment conditions meet Danish standards.