Covid-19 - Update - Danish measures

The government and the labor market parties are gradually phasing out the wage compensation scheme

The government and the labor market parties agree to phase out the temporary wage compensation scheme for employees until 29 August. The scheme will then cease.

With the agreement, the parties agree to extend the temporary wage compensation scheme until August 29. In this way, the government and the labor market parties ensure a phasing out of the scheme that extends over the summer holidays. This creates greater security during the summer holidays for those workers who experience that the corona-virus has lessened the need for manpower with Danish companies.

The phase-out means that the salary compensation scheme extends over the summer, with many companies being closed over the holidays. However, the wage compensation scheme is not intended to secure state aid during the normal holiday period. Therefore, the employees covered by the scheme must take up to three weeks' vacation where no compensation can be obtained. The requirement applies only if the employee has earned the holiday days as a result of the holiday law. In all cases, however, the company is offset by three weeks' compensation.

Minister for Finance, Nicolai Wammen, says:

The temporary wage compensation scheme has had a decisive impact on more than 200,000 Danish employees. At the same time, it has been an important prerequisite for our society being well equipped for the next step in the recovery of the Danish economy. The government and the labor market parties entered the crisis together, and now we continue the way out of the crisis together. With the agreement, we ensure a balanced phase-out of the wage compensation scheme. This creates greater security for the individual employee over the summer, and at the same time is a socially financially responsible solution, because both employees and employers contribute.

The wage compensation scheme is further extended for employees in companies, which are fully closed as a result of the prohibition on keeping open. For these companies, the scheme ceases when the ban is lifted.

Minister for Business, Simon Kollerup, says:
We were quick to shut down and therefore among the first countries to start opening. The Corona crisis has loosened its hold, but that does not mean that we are on the other side yet. Therefore, I am pleased that with the agreement we can protect Danish workplaces, so that employees can have their summer holidays in peace of mind, and the companies have their valued employees when they come out on the other side and the wheels run again.

Minister for Employment, Peter Hummelgaard, says:
I am glad that we can continue protect the workers and companies affected by the Corona crisis. We are well in the process of reopening society and have control over the virus, but several industries will continue to have difficulty, which is why we, along with the labor market parties, have decided to extend the wage compensation scheme until the end of August. And we take special care of closed industries. I am glad that the parties are again taking responsibility. At the same time, the government and the labor market parties agree to discuss a new temporary work allocation scheme, in addition to the existing one, based on, among other things, the principles in the recommendations of the government's economic expert group.

Source: https://www.regeringen.dk/nyheder/2020/regeringen-og-arbejdsmarkedets-parter-udfaser-gradvist-ordningen-om-loenkompensation/

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