Overview of the new holiday rules

Overview of the new holiday rules

The holiday rules as we know them will be changed as of 1 September 2020 to ACT no. 60 of 30/01/2018.

The holiday rules as we know them will be changed as of 1 September 2020 to ACT no. 60 of 30/01/2018.  With the new holiday rules, Directive 2003/88/EC of the European Parliament and of the Council  (see, inter alia, Article 7) requires an annual paid holiday, and this compromises with the Danish Holiday Act, which in some cases only provides paid holiday for new employees up to 16 months after the first employment.

Simultaneity

The upcoming holiday rules contain a number of new concepts. One of them is concurrent holiday, which does not exist today, where there is staggered holiday. According to the old rules, holiday is accrued in the calendar year from 1 January to 31 December. This holiday can only be taken from 1 May to 30 April of the following year.

The concept of concurrent holiday means that holiday is accrued and taken simultaneously over a period of 12 months that runs from 1 September to 31 August (which is a holiday year under the new rules), and the accrued holiday can be taken in the period from 1 September in the same year to 31 December in the following year. With the new holiday rules, all employees can take their holiday over a period of 16 months in total (which is the holiday period that runs from 1 September to 31 January). The new holiday rules mean that the holiday that is earned in April, for example, can now be taken in May of the same year. The mentioned concurrent holiday starts on 1 September 2020.

The Ministry of Employment’s overview of concurrent holiday

The Ministry of Employment has prepared the following figure on the new way of accruing and taking holiday:

No noticeable changes for employees who have been in the labour market longer

If you as an employee continue in the same employment relationship, you will not experience any noticeable change. This is because the new holiday rules mainly deal with when holiday is earned and when it can be taken. Therefore, 5 weeks of paid holiday are still accrued per year, and the rules for when holiday must be given notice are maintained.

Advance holiday

When there is concurrent holiday, the holiday will be accrued on an ongoing basis. As something new, the new holiday rules include the possibility for employees and employers to agree to take the holiday before it has been earned. This is advance holiday. Workers can make use of the new concept of advance holiday if they want to take more holiday at the beginning of the holiday year than they have earned. In this way, the employer gives “credit” on the holiday, which is then matched when the employee earns the given holiday.

Transitional arrangement to the new holiday rules that freeze holiday pay

From 1 September 2019 to 31 August 2020, a transitional scheme has been introduced that freezes the newly earned holiday. This means that holiday earned during this period can neither be taken nor paid out. The transitional scheme ensures that the workplace does not have to pay double holiday when the new holiday rules come into force on 1 September 2020. This means that the holiday earned from 1 September 2019 to 31 August 2020 is frozen in a fund (Lønmodtagernes Feriemidler), and the money is not paid until the employee leaves the labour market.

The holiday earned in 2018 will not be affected by the new holiday rules. This holiday must be taken according to current holiday rules from 1 May 2019 to 30 April 2020.

From 1 January 2019, everyone will earn holiday as usual until 31 August 2019. During this period, a total of 16.64 days of holiday are accrued, which must be taken in the period from 1 May 2020 to 30 September 2020. Any untaken holiday days will automatically be transferred to the new holiday scheme.

If a worker wishes to take more than 16.64 days of holiday during the summer holiday period from 1 May 2020 to 30 September 2020 (or, for example, wishes to take a week of autumn holiday in week 42 2020), the worker must save 5 days of leave, which can then be carried over. If the employee has not earned enough holiday to take autumn holiday (week 42 2020), it can be agreed with the employer to take holiday in advance. See more about advance holiday above.

Illustration from the Ministry of Employment of the transitional scheme

The Ministry of Employment has prepared the following figure, which shows the entire transition period:

Remember there may be collective agreement rules that give the right to extra holiday days (6th holiday week). This matter is not included in this letter, but you can always contact Raadgiver.dk if you want a review of your holiday situation.