Proposed law on more stringent rules on work and residence permits have now been passed

It must be easy for Danish companies to recruit well-qualified foreign labour to be able to succeed with international competition. The work schemes must therefore be balanced in relation to ensuring proper conditions for foreign workers in Denmark. The recently passed amendments to the Aliens Act must thus contribute to achieving the balance.

The changes are supposed to help to ensure that there is no "cheating" on the rules that employers are obliged to comply with, when they have foreign workers employed

Usual conditions and delimitation of the concept of remuneration

In order to get a Danish residence and work permit, the concept of remuneration must be as usual. It is implied from standard practice, that salary paid in Denmark and salary paid in the employee's home country as well as remuneration in other forms, such as housing, transport, etc. can be included in the assessment of the pay rate when SIRI (the Danish Agency for International Recruitment and Integration) decides whether an individual employment takes place on the usual concept of remuneration.

The passed proposed law entails that in future, SIRI will only have to decide on information regarding cash payments i.e. that other forms of remuneration such as housing, free telephony, internet and transport will no longer necessarily be included in the assessment of whether employment is based on the usual concept of remuneration.

Thus, this will be a tightening of the rules in proportion to the current rules for the pay scheme and the fast track scheme’s pay statement, as the requirement for remuneration in the form of cash payments previously only applied to pay components up to the pay scheme’s pay requirement.

In future, salary payments must be made to a Danish bank account

According to the previous rules, it applied to both the pay scheme and the fast track scheme that the annual minimum wage was to be paid into a Danish bank account, which did not apply to the other work schemes.

With the proposed law, the salary payments to a foreigner who has obtained a residence permit with the purpose of employment for a specific employer, must be made to a Danish bank account regardless of the scheme in question. The proposed law will strengthen SIRI’s control options with the salary being paid in Denmark and with the foreign employee receiving the actual salary stated in the employment contract.

Rejection of presumptions becomes a reality

With the passed proposed law, it will not be possible to get a permit for employment if it is presumed that the actual employment conditions do not correspond to what is stated in the application or will not meet the conditions for a residence permit. Moreover, it will not be possible if the purpose of the employment offer is to provide the foreigner with a residence that would not otherwise be possible. 

Requirement for separate work permits for (some) family members

According to the previous rules, foreigners with a residence permit for employment have had the right to bring their family to Denmark. The family members were exempted from the work permit requirement. This means that these family members could work in Denmark when they received a residence permit without having to apply for a work permit.  

This scheme will be kept as a starting point, with the exception of the family members who wish to work for the same company to which the foreign worker’s residence and work permit is connected to, or for a company with a close connection to it. In future, these family members will have to apply for a separate work permit from SIRI, which will be free of charge.

Strengthening SIRI’s control of foreign labour

In future, SIRI must have access to make unannounced inspection visits to companies. SIRI is given competence to gain access to companies’ property against proper identification and without a court order, if the company has a foreigner employed, to check that information about the foreigner’s pay and working conditions for the residence and work permit is complied with. This is a strengthening of SIRI’s previous control options.

SIRI did not previously have independent access to require companies to keep a logbook. According to the passed proposed law, SIRI get access to require an employer to make daily digital registration of information (logbook) about foreign labour. A logbook must document that the employer complies with the rules for foreign labour.

SIRI can, e.g. issue orders to keep a logbook in the following situations:  

• if the employer is unable to present a duty schedule and there is no fixed system for when employees are working
• if there is a suspicion of inappropriate accommodation at the workplace
• if there is a suspicion of unfairly unpaid overtime
• if foreigners are employed with a higher salary than that is usually the case for people working the same type of jobs, etc.
• if there is a suspicion that the actual number of working hours for an employed foreigner is not reported in Eincome or
• if the employer has several companies and there is a suspicion that an employed foreigner works in another of the employer’s companies than the one to which the permit is valid

Lund Elmer Sandager’s comment

In line with the law change, we assess that companies that employ foreign workers, must in some situation change both conditions of employment for the employees in connection with remuneration and must expect to spend more resources on ensuring compliance with the rules in general in connection with employment of foreign workers.

If you have any questions about the proposed law or if you need advice in a case when assessing your company’s compliance in the areas, please do not hesitate to contact Lund Elmer Sandager’s specialists in employment law; Partner, Attorney Michael Møller Nielsen, Attorney Julie Flindt Rasmussen or Assistant Attorney Marta Valgren Knudsen.