Checklist: How to read your employment contract

It is important that you read your employment contract thoroughly before signing it.

This applies both if you get a new job or if you get a new contract in connection with changes to your position.

Once you sign an employment contract, it is binding, and then it is difficult to change the contract and the terms you have agreed to.

In addition, you are obliged to show up on the first day and start work once you have signed the contract. This also applies even if you have changed your mind and do not want the job at all.

Here you can read about most of the points you need to be aware of in your contract, and which you can try to negotiate.

You can also download IDA's standard contract to see what the individual provisions in your contract must contain or how they can be worded.

Download IDA's standard contract here:

Contract for salaried employees (In Danish)

Contract for salaries employees (In English)

If you have doubts about anything in your contract, as a member of IDA, you can always send the contract to IDA's legal advisers who will review it.

Have your contract reviewed by IDA's legal advisers

WHAT YOUR EMPLOYMENT CONTRACT SHOULD INCLUDE:

Names and addresses of the parties (mandatory in the contract)

The employer's name and address must appear in the contract.

Your name and address must also appear on the contract.

Why it's important: It's important that the contract itself shows who the agreement was made with, because it can be important if you, for example, have to make a claim against your employer for lack of pay or something else.

Starting date (mandatory in the contract)

The starting date of your position must be stated in your contract.

Why it is important: It is important to be able to calculate your notice of termination and compensation.

Place of work (mandatory in the contract)

The location of the workplace must be stated in your contract.

If there is no fixed workplace where you will mainly carry out the work, it must be stated that you are employed at different addresses or that you are free to decide where you work from.

Why it's important: The place of work must be stated in the contract, because there are limits to how far your place of employment can be moved without notice.

See the rules if your employer wants to change your place of work

Work tasks (mandatory in the contract)

Your job description and tasks must be in the contract.

The job description must clarify your competence and duties but must also have the flexibility necessarily in an employment relationship.

Why it's important: When your contract contains information about your work tasks and your job description, you protect yourself against your employer being able to significantly change your work tasks without notice.

See the rules if your employer wants to change your work tasks

Working hours (mandatory in the contract)

Your weekly or daily working hours must be stated in your contract.

In Denmark, working hours are not set by law, and without fixed working hours you have no upper limit to your weekly working hours. You are only protected by the Working Time Directive's cap of an average of 48 hours per week over a period of four months and the Working Environment Act's 11-hour rule (minimum 11 hours of rest between two working periods).

Working hours are normally 37 hours per week, excluding lunch for private sector employees. If you have a paid lunch break, this must be specified in your contract.

IDA is against employment without maximum working hours. If you cannot get a provision on maximum working hours inserted in your contract, an alternative could be a provision that the weekly working hours "in principle" amount to 37 hours.

Time spent on business trips and further training should also be included as part of the working time.

Why it is important: The working hours must be stated in the contract, as this has a bearing on when something is considered overtime.

See the most important rules for working hours

Overtime

Your employment contract must state whether you can be required to work overtime, which conditions must be met and how you will be remunerated for overtime.

Why it's important: If nothing is stated in your contract, you are not entitled to time off or payment for overtime work.

Salary – amount, regulation and payment (mandatory in the contract)

Your salary must appear in the contract, and it must be clear whether it is exclusive or inclusive of pension.

The date for the monthly payment of your salary must be stated in the contract. This is important if you need to raise a claim for non-payment of salary.

Your contract should also contain an annual date for salary negotiation, preferably supplemented by a provision that entails an automatic minimum adjustment.

A job change is the best opportunity for a significant increase in salary, which is why it is important that you have prepared well before signing the contract. Once you have signed the contract, you are in a bad negotiating position if you want to increase your salary.

See how you calculate the salary level for your position and prepare for the salary negotiation

Pension

As a private sector employee, you are not automatically entitled to a pension contribution from your employer. This must be agreed in your employment contract.

It is important that you take out a pension scheme as early as possible with associated insurance schemes that cover, among other things, serious illness, loss of working ability and death.

IDA recommends a total pension contribution of 15 percent, because you can thus build up sufficient savings to ensure financial stability in retirement.

It is illegal if the employer wants to insert a provision in the contract that you must resign before the general retirement age.

Bonus

Not all employees have a bonus scheme, and bonus schemes can vary greatly.

However, you should ensure that you are entitled to a proportionate bonus if you resign in the middle of a bonus year. If you resign in June, you should receive a payout out half of the annual bonus. This is already stated in the Salaried Employees’ Act, but it is a good idea to make your employer aware of this as well.

The criteria for when you are paid your bonus must always be objective, written down and reasonable.

Bonus and performance pay: What you need to know (In Danish)

Absence with the right to pay - holiday, parental leave and child’s illness

Your employment contract, collective agreement or the personnel handbook at your workplace must state how long you are entitled to paid absence.

This applies to all the following types of absence:

Holidays and extra holiday entitlements:

You are entitled to 5 weeks of holiday according to the Holiday Act. Everything beyond this must be agreed with your employer. This means that extra holidays and days off must appear in your contract. The same applies to the rules for earning and settling extra days off.

Most IDA members have 5 extra holiday days off per year as agreed in their contract (feriefridage).

According to the Holiday Act, you can be required to take holiday during a notice period, but IDA recommends that you get it written into your contract that you cannot be required to take holiday during a notice period, regardless of whether you are terminated or not.

Time off on public holidays:

You have paid time off on all public holidays. That is:

Christmas and New Year’s: 1^st Christmas Day and Boxing Day (December 25 and 26), New Year's Day (1 January)
Maundy Thursday, Good Friday, Easter Sunday, Whit Monday and Ascension Day.

On the other hand, you do not necessarily have the right to take time off with pay, e.g. Christmas Eve, New Year's Eve, May 1 and Constitution Day. This must be stated in your contract.

See on which public holidays you are legally entitled to take time off

Pregnancy, parental leave and adoption:

As a private employee, your salary and pension savings during parental leave will be regulated by Danish legislation, your employment contract, a local agreement, a private collective agreement or the company's personnel policy.

You are not entitled to full pay during your parental leave, unless this is stated in your employment contract, collective agreement or the personnel handbook at your workplace.

If you adopt, you also have the right to leave.

You are not entitled to full pay during your leave, unless this is stated in your employment contract or a staff handbook.

Children's illness:

You have the right to take time off on the child's first and possibly second sick day. However, you are not entitled to pay if you take time off, unless it is part of your employment contract, collective agreement or the staff handbook at your workplace.

This does not necessarily mean that you receive full salary when you are at home with a sick child.

If you are to receive full salary on the child's first and possibly second sick day, this must be stated in your contract.

Care days:

Whether you are entitled to carer's days depends on your terms of employment.

Continuing education and skills development

If you are to have the right to further training, this must be stated in your contract.

Therefore, you should align expectations for how many days of continuing education you can take per year, and how much the continuing education must cost, when you negotiate your employment contract.

You can try to secure the right to 2 weeks of training per year and/or have a specific amount or name of a specific training inserted, which the employer must pay.

If it is a long and expensive course, your employer can insist that you have a training clause written into your contract, so that you must repay the course expenses if you resign.

Employee benefits: Mobile phone, wifi and home workspace

It is common for employers to offer employees fringe benefits in the form of employer-paid wifi, mobile phones, computers, newspapers and the like. Such agreements must be included in the contract, and it must be stated whether you may use it privately at the employer's expense.

Please note that you are taxed annually on the use of mobile phones, PCs, internet etc.

Travel expenses

If you travel with your job, you are always entitled to a corresponding travel advance so that you don't have to pay for it yourself. This appears from the Salaried Employees’ Act.

This applies even if it is stated in your contract that you must pay expenses yourself and subsequently get your expenses reimbursed.

Why it is important: the distinction between advances and disbursements is important if the company goes bankrupt.

Inventions and Copyright

If you create or invent something, there is a high probability that you will have to transfer the rights to your employer.

However, you can enter into an agreement with your employer that you retain the rights yourself, or that you are paid a bonus if what you create is successful.

If you take a job where there is a probability that you will invent something, or if you work with inventions in your spare time, you should therefore have your employment contract read through by IDA.

Termination

Your and the employer's notice of termination must be included in the contract.

IDA's members are almost always covered by the Salaried Employees’ Act in terms of the positions they hold. Therefore, you are probably covered by the Act's rules on termination. This means that if you resign, it must be done with one month's notice to end at the end of one month.

If the employer dismisses you, this must be done with notice, which depends on how long you have been employed.

If your notice of termination is to be longer than one month, the employer's notice of termination must at least be extended accordingly.

You can try to get an agreement that from the start of employment, 3 months' notice from the employer's side applies.

Termination due to illness – the 120 day rule

If you are covered by the 120-day rule, this must be stated in your contract.

The 120-day rule means that your employer must have the option of dismissing you with a shortened notice of 1 month, if you have received 120 days of sick pay within a period of 12 months. These rules apply regardless of how long you have been employed by the company.

Trial period

A trial period means that you and the employer can terminate the employment with shorter notice than the normal notice of termination under the Salaried Employees’ Act.

If there is nothing about a trial period in the contract, there is none.

During the trial period, the employer can terminate you with 14 days' notice, while you can terminate with 1 day's notice if no longer notice is stated in your contract.

If the contract states that your termination must be done with at least 14 days' notice, you must respect this. Otherwise, you risk having to pay compensation to the employer.

There is a certain risk associated with changing jobs, and therefore you can try to negotiate that you will not be employed on a trial period with the accompanying short notice of termination.

Outplacement

If you are made redundant, an outplacement course can be a good help to move on. In an outplacement course, you get professional help to clarify your skills and look for a job.

An outplacement course can be beneficial for both you and your former employer, because you get a job faster.

It can therefore be an advantage if you introduce a provision on outplacement in your contract.

Non-competition clauses and non-solicitation clauses

You are not bound by a clause unless it appears in your contract.

The most common clauses are non-competition clauses and non-solicitation clauses. They limit your opportunities to look for a job because they limit you from having professional connections with former clients, business partners and competitors. Therefore, you be careful before signing a contract containing clauses.

Always have IDA's legal advisers read your contract if it contains a clause.

Duties and side jobs

You have the right to do volunteer work without pay or to have symbolic paid duties alongside your work, without the consent of your employer. This applies, for example, to board work in sports associations, political work or board work in professional associations.

However, your side job must not be incompatible with your employment, e.g. because it involves risks to your health, it endangers business secrets, it compromises your integrity in public administration, or it involves a conflict of interest.

Your job must also not be a disadvantage for the employer. There is no concrete definition of when your job is disadvantageous, and a concrete assessment must therefore be made. One rule of thumb, however, is that it is a disadvantage if you cannot carry out your work as agreed.

If you disagree with your employer, you can contact IDA's legal advisers.

Health information

Some contracts contain a provision that by signing you confirm that you do not suffer from serious illnesses that may affect your ability to work.

In addition, according to the law, you have a duty to inform the employer if you suffer from an illness or have symptoms of an illness that will have a significant impact on your ability to work. You must disclose this before you sign the contract, if the employer asks about it or on your own initiative.

However, there are limits to what an employer can require you to disclose about your health condition.

You can contact IDA's legal advisers and get help if you are in doubt about what to disclose

Terms in the personnel handbook or collective agreement

In your employment contract, you must be informed about which collective agreements or agreements regulate your employment.

You must therefore be aware that you may have conditions that are not in your contract. These terms may be contained in a collective agreement, a staff handbook or the like.

Always ensure that you are given and read through a possible staff book and collective agreement.

See all IDA's agreements in the private sector (in Danish)

Employment terms and contracts