At a Glance
- Effective January 1, 2020, the minimum annual salary for foreign workers under the Pay Limit Scheme, the primary Danish work authorization type, has increased to DKK 436,000, up 2.1 percent from 2019.
- Employers must update salaries for pending and new applications, if required.
- Also effective January 1, 2020, a new list of shortage occupations applies to Danish Positive List applications. Notably, finance and information technology managers, information technology engineers and legal officers, among others, no longer qualify for this permit type while research and development managers and web developers, among others, now qualify for the permit type.
- Permit holders with job titles removed from the 2020 list can continue to work and stay in Denmark, and can renew their permits upon expiry. Pending applications for removed job titles will be processed based on the shortage occupation list available at the time of filing.
The situation
Effective January 1, 2020, the minimum annual salary for foreign workers under the Pay Limit Scheme, the primary Danish work authorization type, has increased to DKK 436,000, up 2.1 percent from 2019. The exchange rate at the time of publication of this alert is 1 DKK to 0.15 USD.
Also effective January 1, 2020, a new list of shortage occupations applies to
Danish Positive List applications.
Pay Limit Scheme
Details concerning the increase in minimum annual salary for the Pay Limit Scheme include the following:
Category |
Details |
Existing employees |
Employers of foreign nationals currently holding a Pay Limit Scheme permit do not need to increase foreign nationals' salaries, provided that all employment conditions remain the same. |
Initial and renewal applications |
Employers of foreign nationals seeking to obtain a Pay Limit Scheme permit on or after January 1, 2020 must increase foreign nationals' salaries to comply with the new rule. Immigration applications that do not meet the minimum salary will be refused. |
Pending applications |
Employers of foreign nationals with pending
Pay Limit Scheme applications as of January 1, 2020 generally do
not need to increase foreign nationals' salaries to comply with
the new rule, though the Migration Agency may require this on a
case-by-case basis.
|
Danish bank account |
The minimum salary amount (DKK 436,000 under the new threshold) must be paid into a Danish bank account, but home payroll is allowed. |
Currency |
Employers are required to guarantee the salary in DKK regardless of payroll location and/or exchange rate fluctuations. |
Benefits and allowances |
Benefits and allowances generally cannot be included in the minimum salary calculation. Only basic salary, paid holiday allowance, and pension scheme payments may be included in the minimum salary calculation. Specifically, paid living and housing expenses, per diems, paid means of transportation, paid phone and internet bills are not considered salary components. |
Payments in line with contract |
Salary payments must be in conformity with the salary details mentioned in the employment / assignment contract. |
Pro rata payments not allowed |
The amount cannot be prorated, e.g. in case of extended unpaid leave. |
Timing of compensation payments |
Compensation amounts can only be included in the minimum salary calculation in the year they are paid. |
Positive List
Details of the new list of shortage occupations for the Danish Positive List include the following:
| Category | Details |
Key occupations added to the 2020 list |
" Head of division " Research and development manager " Marine engineer " Industrial designer " Accounting controller " Human resources consultant " Web developer " Civil economist |
Key occupations removed from the 2020 list |
" Finance manager " Chief accountant " Logistics manager " Marketing manager " Deputy manager, sales " Public relations manager " Area manager " Manufacturing manager " Information technology manager " Engineer, design and innovation " Business controller " Information technology engineer " Legal officer " Construction manager |
Existing employees |
Permit holders with job titles removed from the 2020 list can continue to work and stay in Denmark, and can renew their permits upon expiry. |
Initial and renewal applications |
New applications can now be submitted for the recently-added positions. Renewal extensions for positions which were previously available but recently removed are still possible. |
Pending applications |
Pending applications for removed job titles will be processed based on the shortage occupation list available at the time of filing. |
Background
It is common for European countries to update salary requirements, government fees and similar immigration requirement on January 1 of each year to reflect inflation.
Looking ahead
Fragomen expects additional countries to update their salary requirements and shortage occupation lists for 2020. Denmark is expected to review the shortage occupation list again in June, to take effect July 1, 2020.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
