About CBS

The Danish Model


In Denmark, there is no comprehensive governmental interference in the Danish labour market or any legislation regarding wages or working conditions. This makes the Danish labour market very unique. There are five basic dynamics, which defines the Danish labour market: Security, stability, trust, efficiency, and flexibility.

You will find a clear division of responsibility between the Danish government and the social partners, regarding the labour market policies. The government intervenes as little as possible in labour market issues. When handling concrete challenges on the labour market, the Danish government invites the social partners to triparte discussions to find an agreement.

The labour market id a hybrid combination of on the one hand a well-developed and extensive social protection system and on the other hand an active labour-market policy with flexible regulations. There is a general open and inclusive focus on employment security, which makes companies less hesitant to recruit new employees and let them adjust, as it is relatively easy to dismiss employees. However, this also makes workers more open to mobility and job changes. This is what is known as the flexicurity model, which consists of three core elements: 
     1. Employers are able to hire and fire, without excessive costs for dismissing employees.
     2. Employees who join an unemployment insurance fund receive up to two years unemployment benefit after losing their job.
     3. In order to get unemployed Danes back to work quickly, the government has education and retraining programs, while also providing counseling services.

Further, the Danish state provides subsistence payments for Danes who loses their livelyhood due to illness, divorce, or unemployment, and who do not qualify under other social welfare schemes.

Trade Union (Fagforening) and Unemployment Insurance (A-kasse) 


Trade Union Representative (Tillidsrepræsentant) 



Wages in Denmark 

 

The page was last edited by: HR // 01/14/2025

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