Employee Rights When an Undertaking is Transferred in Denmark

1. Employees’ Rights

The Danish Act on Transfers of Undertakings provides for a certain protection of the employees in relation to transfers of undertakings. Pursuant to the Act, rights and obligations under individual employment agreements and collective bargaining agreements are automatically transferred to the transferee in the event of a transfer of a business or part of a business.

If, in connection with the transfer, the employees’ working conditions are changed to the detriment of the employees, the employees may choose to consider themselves dismissed. Consequently, they may terminate their employment without notice from the date on which the changes have come into effect.

The Act also contains provisions on information and consultation of the employees (or the employee’s representatives). Non-compliance with these rules is sanctioned with fines.

2. Requirements for Predecessor and Successor Parties

According to the Act on Transfers of Undertakings, an employer who considers a transfer of the employees must consider carefully if negotiations or consultations with the employees or the employees’ representatives must be initiated. Such obligations may follow both from the act and from collective bargaining agreements.

The Danish Act on Transfers of Undertakings furthermore establishes that prior to the transfer of the employees, the employer must in writing inform the employees or the employee representatives about the future transfer and the legal and practical details concerning the transfer of the employees.

For more information, please contact L&E Global.
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