Denmark Statutory and Private Employee Benefits, 2024 Update

Denmark Statutory and Private Employee Benefits Report Overview

Danish social security operates a societal model in which the state assumes primary responsibility for the welfare of its citizens. It covers benefits such as hospitalization, sickness, and maternity benefits; benefits regarding accidents at work and occupational diseases; funeral expenses; disability pension; old-age and supplementary pensions; family benefits; and unemployment benefits. Denmark is among the few countries in the world, which adjusted to the challenge of providing its citizens with a flexible labor market. It was one of the first countries to adopt a multi-pillar pension system, which consists of a flat-rate residence-based national pension and private occupational pensions based on collective agreements.

The Denmark employee benefits report provides an in-depth industry analysis, information, and insights into employee benefits in Denmark, including an overview of the state and compulsory benefits. The report also provides detailed information about the private benefits and insights into various central institutions responsible for the administration of the different branches of social security. Furthermore, it provides the regulatory framework for employee benefits in Denmark.

Denmark Employee Benefits - Regulations

A few of the laws guiding employee benefits in Denmark are:

• The Act on Discrimination in the Labor Market
• The Act on Equal Pay
• The Danish Working Environment Act
• The Taxation of Pension Investment Returns Act of 2006
• The Consolidated Supervision of Company Pension Funds Act of 2007

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Denmark Employee Benefits - State and Compulsory Benefits

The key state and compulsory benefits offered by employers in Denmark are retirement benefits, death in service, long-term disability benefits, short-term sickness benefits, and medical benefits among others.

Retirement Benefits: The Danish pension system comprises three pillars. Pillar I comprises of mandatory state pension based on a pay-as-you-go DB scheme that covers every Danish resident. Pillar II comprises of the occupational pension DC scheme known as Arbejdsmarkedets Tillægspension (ATP). It is a supplementary scheme based on general agreements, and participation is mandatory based on the employment contract. It is based on collective agreements. Pillar III comprises voluntary pension schemes, which are managed by banks or insurance companies.

Denmark State and Compulsory Benefits

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Denmark Employee Benefits - Private Benefits

The key private benefits offered by employers in Denmark are retirement benefits, death benefits, medical benefits, disability benefits, accidental death and dismemberment benefits, and other benefits.

Retirement Benefits: Denmark has one of the most developed pension systems in the world with a high replacement rate. Voluntary pension schemes exist in Denmark as a supplement to the basic pension schemes. These are available as single-employer plans or industry-wide plans where membership is mandatory for all the employers in that specified industry. These retirement benefits are available through pension funds, group insurance contracts, and bank schemes. According to the financial services company Mercer CFA’s Institute Global Pension Index (MCGPI) 2023 report, the overall index rank of the Danish retirement system moved by one place up and stood at third place out of 47 countries’ pension systems.

Denmark Private Employee Benefits

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Scope

This report provides:

• A detailed analysis of the key government-sponsored employee benefits, along with private benefits.
• An exhaustive list of employee benefits, including retirement benefits, death in service, long-term disability benefits, medical benefits, workmen’s compensation insurance, maternity and paternity benefits, unemployment benefits, family benefits, long-term care benefits, minimum resources benefits, leaves and holidays, and private benefits.
• The economic and regulatory situations related to employee benefits in Denmark.

Key Highlights

• The Ministry of Health (Ministeriet for Sundhed og Forebyggelse), Ministry of Taxation (Skatteministeriet), Ministry of Social Affairs and Integration, and Ministry of Employment are responsible for the functioning of the overall social security system.
• A person’s national insurance contribution is determined based on their income.
• An insured person who is unemployed or unable to work and whose benefits have been exhausted is entitled to a credited contribution.
• In Denmark, employers provide voluntary retirement benefits to their employees through voluntary pension schemes.

Reasons to Buy

• Make strategic decisions using in-depth information related to employee benefits in the country.
• Assess employee benefits of the market, including state and compulsory benefits and private benefits.
• Gain insights into the key employee benefit schemes offered by private employers in the country.
• Gain insights into key organizations governing the employee benefits market, and their impact on companies.