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IMPACT – MEDIUM
What is the change? Denmark has passed a law that raises minimum salaries under the Pay Limit scheme for high-skilled foreign workers and abolishes the Green Card scheme.
What does the change mean? Beginning June 10, foreign employees applying for new work permits under the Pay Limit scheme must be paid 400,000 kroner (about US$61,000). The Green Card scheme will be eliminated as of June 10.
Background: The changes were proposed in April and passed Thursday. Beginning June 10, minimum salaries under the Pay Limit scheme will increase to 400,000 kroner per year (33,333 kroner per month), up from the current threshold of 375,000. The salary may include accommodations and other allowances, but 51 percent of the salary must be paid in cash to employees. The 400,000-kroner salary threshold will be adjusted annually for inflation.
Work permit extensions of current salaries may be approved even after June 10 if all employment terms are the same.
Also beginning June 10, the Green Card scheme will be eliminated due to ineffectiveness. However, existing Green Card holders may continue to apply for extensions even after June 10 and accompanying family members of Green Card holders may also continue to apply for residence permits.
BAL Analysis: The changes will impact corporate budgets for employers using the Pay Limit scheme to employ high-skilled non-EU employees in Denmark.
This alert has been provided by the BAL Global Practice group and our network provider located in Denmark. For additional information, please contact your BAL attorney.
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What is the change? Denmark’s political parties have proposed changes to immigration laws that would affect high-skilled foreign workers.
What does the change mean? Under the proposed changes, the annual minimum salary under the Pay Limit Scheme would be raised to 400,000 kroner (about US$61,000), an increase from the current 375,000 kroner. The Green Card scheme would also be eliminated due to ineffectiveness.
Background: The changes have been proposed by the Danish People’s Party, the Socialist People’s Party and the Socialist Democrats, who together constitute a large majority of the Danish Parliament.
Under the proposal, the gross minimum salary for highly qualified foreign employees in the Pay Limit Scheme would increase to 400,000 kroner per year, up from the current threshold of 375,000. The salary may include accommodations and other allowances, but 50 percent of the salary must be paid in cash to employees.
The other proposal is to eliminate the Green Card scheme, which allows highly qualified foreign nationals to apply for residence and work permits without employer sponsorship for the purpose of seeking employment in Denmark. The reasons for the proposed elimination is that green card holders have not been successful in finding employment in their sectors and instead have taken up low-skilled jobs.
BAL Analysis: The changes, if adopted, would impact corporate budgets for employers using the Pay Limit scheme to employ high-skilled non-EU employees in Denmark.
What is the change? Denmark has passed a reform bill intended to help employers attract and keep highly educated foreign graduates, researchers and highly educated foreign employees.
What does the change mean? Certain requirements have been eased for foreign graduates, entrepreneurs and researchers, and Greencard applicants will earn more points for educational achievements.
Background: The Danish Parliament passed a bill to reform international recruiting in December. In a previous alert, we reported the bill’s key feature: introduction of a fast-track work permit scheme.
The legislation introduces additional programs. The new Establishment card allows foreign graduates who earn a master’s or Ph.D. degree in Denmark to stay and work in the country for two years without having to apply for a work permit. The Start-Up program, a three-year pilot, will grant 50 permits per year to qualifying entrepreneurs. In other changes, the Greencard program will award more points to applicants with higher educational levels and will reform the points system to better serve labor demand, but Greencards will now be valid for two years instead of three and applicants cannot bring dependent family members.
The law also eases several rules for foreign researchers and their employers. Researchers and Ph.D. students are exempt from work permits for up to three months, researchers permits can be issued for part-time jobs and do not lapse if the researcher leaves the country for more than six months, and an employer will not have to apply for a new work permit if the researcher changes jobs within the organization. In addition, the minimum salary has been lowered for purposes of providing lower tax rates under the researchers tax scheme, thus enabling employers to include more foreign nationals in the special tax program.
BAL Analysis: The reforms significantly liberalize various work permit programs for highly educated researchers, international graduate students and start-ups.
IMPACT – HIGH
What is the change? As part of a reform of its foreign recruitment scheme, Denmark has implemented fast-track work permit procedures for employers who qualify.
What does the change mean? The fast-track program allows larger, low-risk employers to start foreign employees immediately without waiting for permit approval. The foreign employees can also work outside Denmark without the permit lapsing.
Background: The fast-track scheme, which is one of several reforms that took effect Jan. 1, is intended to make it easier for companies to recruit and employ high-skilled foreign labor.
To qualify for certification in the fast-track program, an employer must meet several criteria. The company must have at least 20 full-time employees, have a clean labor record, meet salary standards, and meet with the Danish Agency for Labour Market and Recruitment. The certification process takes 30 days and certification is valid for four years.
If certified, employers may use the fast-track program for foreign workers meeting one of the following criteria:
The main benefit of the fast-track service is that it provides foreign employees the option of starting work immediately after filing a work permit application. Under this option, the employees would enter Denmark on their own and appear at the Danish Agency for Labour Market and Recruitment to give their biometrics and go through a security and identity check. They can obtain a temporary work permit and start work immediately while their application for a combined work-and-residence permit is pending. Employees who do not need to start work right away or who want to wait for an approved permit can apply for the residence permit from their home countries. The approval process takes 30 days.
Generally, fast-track permits are valid for a renewable four-year period and do not lapse if the employee works outside Denmark. Short-stay permits are valid for up to three months within a one-year period.
Companies in the fast-track program are subject to periodic checks to make sure they are still following the conditions of certification. The Agency for Labour Market and Recruitment can revoke certification, and any company whose certification is revoked will be banned from fast-track permits for two years.
BAL Analysis: The program offers greater flexibility to employers who need to bring foreign employees to Denmark urgently and for foreign employees and assignees working in Denmark who must also work abroad without losing their Danish permit.
What is the change? The Danish Parliament has passed a bill that places approved companies on a fast track for work permits.
What does the change mean? The new procedures will allow pre-certified, registered companies to obtain expedited work permits for highly skilled employees.
Background: On Dec. 18, Parliament passed the reform measure (“Reform af international rekruttering”), which proposes to create a fast track for pre-approved employers applying for work permits for highly skilled foreign labor. Under the current version of the bill, companies that are pre-approved will be considered low-risk and therefore will be allowed to start foreign employees as soon as they file their applications. Full details – including eligibility criteria for companies to become pre-approved, documentary requirements and any new procedures – are expected to be unveiled next month.
BAL Analysis: While the specifics of the fast-track procedures are still unknown and a final bill may differ from the current version, an expedited work permit procedure is a welcome development that will improve conditions for companies that qualify.