In February 2023, the Danish Parliament adopted “the law on the consequences of the abolition of Great Prayer Day as a public holiday“. As a result of the removal, from 1 January 2024, employees must be compensated with 0.45% of their annual salary for the increased working hours. In this blog post you can learn more about the rules for compensation.
The background for the removing Great Prayer Day as a public holiday
In the beginning of 2023, The Danish government decided that Great Prayer Day should be abolished as a public holiday, which means that employees are no longer entitled to a day off on the fourth Friday after Easter. The purpose of the law is to ensure that Great Prayer Day is considered a normal working day, where the salary and employment conditions on any other normal working days also apply on this day.
The decision was made as part of the government’s efforts to modernize the labor market and increase productivity. With more and more companies operating in a global market, there has been a desire to adapt Danish working conditions to international standards and create greater flexibility.
The government has argued that the abolition of Great Prayer Day as a day off will be beneficial for both the economy and the labor market by increasing productivity and competitiveness. At the same time, the change aims to create a more coherent working year without longer breaks, which can sometimes be challenging for businesses and productivity.
The decision has consequences for the employees’ working hours, which is why the government has made some rules for compensation for the increased working hours.
Different rules for payment of compensation
According to the law, the compensation for the increase in the employees’ working hours must be done through a salary supplement of 0.45% of the employee’s annual salary. The salary supplement must be calculated based on the employee’s current, usual and fixed predictable salary. The employer’s contribution to pension schemes and fixed allowances, including overtime allowance, on-call allowance and availability allowance, must therefore be included in the calculation of the salary allowance. Payment for overtime and holiday allowance, on the other hand, must not be included in the basis of calculation.
The payment of the compensation depends on whether the employee is paid monthly or hourly, and there are different ways the employer can choose to pay the compensation, namely on an annual or monthly basis.
This also applies that managing directors and self-employed persons, with whom the employer collaborates on a consulting basis, are not covered by the law.
Compensation for monthly salaried employees
For monthly salaried employees who have been employed in the company before 1 January 2024, it applies that from 1 January 2024 they will be compensated for the increase in their working hours through a salary supplement of 0.45% of their annual salary. A monthly salaried employee is defined as an employee with a fixed salary for a given period, regardless of the number of holidays in this period. It is not yet known whether employees employed after 1 January 2024 are also entitled to compensation.
Compensation for hourly salaried employees
If an hourly salaried employee must work on Great Prayer Day, they will receive their normal pay for work on that day. If the employees have previously worked on Great Prayer Day and received a public holiday allowance, this allowance will no longer apply, as it is now a normal working day.
Payment of the supplement
The employees earn the supplement from 1 January 2024, and it can be paid in two ways: on a monthly basis or on an annual basis.
If the employer chooses the monthly payment, they receive the supplement together with their normal salary. If the employer chooses to pay the salary supplement on an annual basis, the employee will receive it together with the holiday supplement in accordance with the rules of the Holiday Act, i.e. twice a year together with the monthly salary for May and August. If an employee resigns from their position, they are entitled to have accrued allowances settled since the last payment of the allowance.
Do you as an employer want to keep Great Prayer Day as a paid day off?
Nothing prevents you as a company to make special agreements with one or more employees to have time off on regular working days – including e.g. Great Prayer Day, 1 May and Constitution Day, all of which are considered ordinary working days. If you, as an employer, choose to offer the employees that they can take paid time off on Great Prayer Day, the monthly paid employees must still receive the salary supplement of 0.45%.
Curious to know more?
Would you like to learn more about how you can easily handle Sunday and public holiday rules with Intempus? Then you are welcome to contact us for a non-binding chat on +45 26 390 400 or book a free and non-binding demo:
Sources: EY.com, Retsinformation.dk.
