7 October 2015

New legislative programme 2015/2016: Important amendments within employment law

The government recently published the legislative programme for the new parliamentary year. The programme contains a re-introduction of the bill on employment clauses, which will result in a number of important amendments.

THE MINISTRY OF EMPLOYMENT'S LEGISLATIVE PROGRAMME

The new programme contains the following important bills within employment law:

  • Due to the parliamentary election, the former government's bill on employment clauses was cancelled in the spring 2015. The present government will re-introduce the bill in October 2015, see below.
  • The bill to amend the Act on the Danish Board of Equal Treatment will be re-introduced with a requirement for legal interest with the result that the Board may use its resources on the most important matters concerning equal treatment. The bill will be re-introduced in October 2015.
  • Bill to amend the Working Environment Act for the purpose of publication of the names of companies grossly violating the rules and to obtain a higher fine level. The bill will be introduced in October 2015.
  • Bill to amend the Part-Time Act ensuring correct implementation of the EU Working Time Directive. The bill will be introduced in December 2015.
  • Bill to amend the Act Concerning the Posting of Workers etc. for the purpose of implementing the EU enforcement directive. The bill will be introduced in January 2016.
  • Bill to amend the Industrial Insurance Act. The bill's purpose is to put a future agreement on the modernisation of the area into practice. The bill will be introduced in February 2016.

ACT ON EMPLOYMENT CLAUSES WILL BE RE-INTRODUCED

The bill contains the following important elements:

  • The act will apply to all employees and the rules on non-competition and non-solicitation clauses will not be limited to salaried employees.
  • The act will amend the rules on conclusion of non-competition and non-solicitation clauses and combined employment clauses. These amendments will result in the abolishment of sections 18 and 18a of the Salaried Employees Act and section 38 of the Contracts Act.
  • Non-competition clauses may only be concluded with employees in "very special positions of trust". The amendments will strengthen the rules as the only requirement today is that the employee holds a "position of trust".
  • Employees covered by a non-solicitation clause must receive a list of the clients/customers covered by the clause in the event of dismissal or resignation.
  • An employee cannot be bound by a non-competition or non-solicitation clause for more than 12 months from the effective date of termination.
  • If an employee is covered by both a non-competition and a non-solicitation clause (a combined employment clause), these may apply for six months from the effective date of termination.
  • The bill will introduce differentiated compensation depending on the term of the employment clause and whether the employee has obtained other appropriate work.
  • The employee is entitled to minimum compensation for the first two months payable as a lump sum. Today, minimum compensation applies to the first three months, but only in relation to non-competition clauses. The bill contains a prohibition against job clauses, but the current rules on temp agencies and business transfers will continue - without compensation. As soon as the Act on Employment Clauses comes into force, the Act on Job Clauses will be abolished.

We will, of course, keep you informed about the pre-legislative work.

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