A new labour arbitration ruling could have a major impact on companies and part-time workers in the industrial sector. The ruling states that current practices for overtime pay are not in line with EU rules - and it changes the rules of the game.
Here's an overview of what has been decided and what it could mean in practice
What has been decided?
On 4 February 2026, a trade union arbitration court with three Supreme Court judges ruled that the rules on overtime in the Danish Industry Collective Agreement and the Danish Industry Salaried Employees' Collective Agreement do not comply with the EU Part-time Work Directive.
The previous practice was that part-time employees only received overtime pay when they worked more than the full-time norm (typically 37 hours per week). This means that a part-time employee who was hired for 25 hours a week, for example, did not receive overtime pay until they worked more than 37 hours.
Briefly about the Part-Time Work Directive
The EU Part-Time Work Directive aims to protect part-time workers from less favourable conditions than full-time workers simply because they work fewer hours.
In Denmark, the directive is implemented through collective agreements and legislation and applies widely in the labour market.
What will apply in the future?
Going forward, part-time employees must receive overtime pay for hours beyond their individually agreed working hours, If:
- there are comparable full-time employees at the company and
- These full-time employees would have received overtime pay in a similar situation.
The decisive factor is no longer the full-time norm, but the individual employee's agreed number of hours.
However, each company must make a specific assessment of whether there are comparable full-time employees.
The background to the case
The case stems from the 2025 collective labour agreement negotiations between the Confederation of Danish Industry and CO-industri.
Two recent judgements from the European Court of Justice raised doubts about whether Danish practice was compatible with EU law. Therefore, it was decided to let a labour arbitration decide on the issue.
The ruling changes a practice that has been in place for many years in the industry.
What does this mean for businesses?
For companies covered by the Industrial Agreement and the Salaried Employees' Collective Agreement, the decision means that:
- Part-time employees may already be entitled to overtime pay when working beyond their own hours.
- Questions may arise about possible back payment claims.
- Specific comparability assessments must be made.
A number of issues remain unresolved, including how the ruling may affect other collective labour agreements.
What about other collective agreements - and employees without a collective agreement?
It is not yet clear what impact the decision will have outside the industrial sector.
For employees without a collective agreement, companies should be aware of the principle of the Part-Time Directive: part-time employees should not be disadvantaged simply because of their working hours.
In practice, this means that part-time employees without a collective agreement should generally be treated the same as comparable full-time employees when it comes to overtime pay.
What should you do now?
- Review your overtime pay practices for part-time employees.
- Assess whether there are comparable full-time employees in your organisation.
- Be aware of potential back payment claims.
- Stay tuned for further clarification in this area.
The decision marks an important shift in the understanding of overtime for part-time workers - and emphasises that working time and payment must be assessed individually and in accordance with EU law.
Source: danskindustri.dk
