Guide to employment contracts

Understanding the drafting, use, and changes in employment contracts can be challenging. This guide explains the key points of an employment contract and highlights what employers and employees should know.

The following content goes through the structure of a standard employment contract, helping you better manage current and future contracts. While this guide serves as a comprehensive resource, professional advice is recommended when drafting contracts.

Parties

An employment contract should clearly identify the parties involved, typically the employer (a company) and the employee. Include full names, contact details, addresses, and identification information (e.g., CVR number for the company and CPR number for the employee).

Job Description and Responsibilities

Specify the employee’s position, primary responsibilities, reporting hierarchy (e.g., immediate manager), and place of employment. If the work location is flexible, such as across Denmark, this must be stated explicitly.

Holiday

Mention the applicable holiday regulations, typically the Danish Holiday Act. Include a clause stating that unused holiday must be taken, if possible, before termination to ensure a clean break in the employment relationship.

Salary

Detail the agreed salary structure (e.g., hourly or fixed), payment schedule, and any supplements from collective agreements, such as night shift fees. Include pension schemes, specifying contributions (e.g., 10% employer, 2% employee).

Termination

Clearly define notice periods for both parties, trial period durations, and associated notice periods. Note that trial periods cannot exceed 6 months and must follow the Employment Certificate Act or the Salaried Employees Act as applicable.

Benefits and Reimbursements

List any benefits such as a company car, mileage allowances, free telephone, trade journals, or travel expense policies. Define rules for representation expenses if applicable.

Working Hours

Specify the standard weekly hours, whether lunch breaks are included, and the expected working hours (e.g., 8-18). If evening or night work is expected, include this explicitly in the contract.

Secondary Occupations

State how secondary employment will be handled. As of July 1, 2023, employers cannot prevent employees from taking secondary jobs unless there is a specific conflict with their primary employment.

Staff Regulations

Include a clause requiring employees to follow company policies such as:

• Smoking policy
• Data breach policy
• Deletion policy
• Security measures

For employees deployed to external workplaces, require adherence to both internal and external staff regulations.

Non-Competition Clause

A non-competition clause restricts employees from working with competitors post-employment. Conditions include:

• Applies only to trusted employees.
• Must be documented in writing.
• Cannot exceed 12 months post-employment.
• Requires at least 6 months of continuous employment.
• Employee is entitled to compensation.

Non-Solicitation Clause

A non-solicitation clause prevents employees from taking customers. Requirements include:

• Applies to customers interacted with in the past 12 months.
• Requires 6 months of continuous employment.
• Compensation must be provided.
• Cannot exceed 12 months post-employment.

Combined Non-Competition and Non-Solicitation Clauses

Combined clauses cannot exceed 6 months in duration.

Signatures

Both parties must sign the contract to confirm their agreement. The employee should also acknowledge receipt of a copy of the contract.

Disclaimer

This guide provides general advice for preparing employment contracts. Professional assistance is strongly recommended for drafting legally compliant contracts. Raadgiver.dk is not responsible for disputes arising from the use of this guide.