Politics and Analysis

New Tripartite Agreement Extends Wage Compensation Scheme Until 29 August

Press Release

The government and both sides in the labour market have entered into an agreement to extend wage compensation for employees in Danish undertakings until 29 August.

Thousands of employees are covered by the wage compensation scheme at present. Under this scheme, the government and the companies cover the employees’ wages even if, due to the coronavirus crisis, there is not enough work for the employees.

Hitherto, the scheme was set to run up until 8 July, but today, the government and both sides of the labour market have agreed to extend the scheme until 29 August. The scheme will not be extended again. Before 29 August, employees must take three weeks’ holiday, for which the companies will not get wage compensation.

The government and the parties in the labour market will continue negotiations on what help will be provided to employees in companies still facing challenges due to the economic crisis after 29 August. Here, the parties are discussing the introduction of a so-called work-sharing scheme that will provide a safety net for employees in the most vulnerable industries and create increased flexibility for the companies,

The CEO of the Confederation of Danish Employers, Jacob Holbraad, says:

“I am happy that, once again, in a difficult time for the country’s companies, both sides in the labour market and the government have found each other at the negotiating table. In the current situation, it makes sense to extend the wage compensation scheme and, at the same time, it is appropriate that employees should take their main holidays during this period.

“It is absolutely crucial that a plan is now devised for how we can best safeguard jobs after 29 August. Help will be needed for employees and companies in particularly vulnerable industries.”

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