This summary of age discrimination law in Denmark has been prepared by Norrbom Vinding, the Ius Laboris member for Denmark: https://norrbomvinding.com/en.
The prohibition against age discrimination was enacted into Danish law in December 2004 in connection with the implementation of Directive 2000/78/EC of 27 November 2000 (the “Directive”). The Directive was implemented through an amendment to the existing Danish Anti-Discrimination Act (the “Act”), which prohibits employers from discriminating against employees on the grounds of race, colour, religion or belief, political opinion, sexual orientation, national, social or ethnic origin and disability.
The Act is the only legislation on age discrimination in Denmark. Direct and indirect discrimination is prohibited.
Employer and employee organisations are free to include the prohibition against age discrimination in collective agreements so long as the resulting provisions on age discrimination do not prejudice employees’ rights under the Directive.
Under the Act, employers are prohibited from discriminating against candidates or employees based on age during recruitment, employment and dismissal. Certain exceptions may apply in certain circumstances.
Harassment on the grounds of age and instructing others to discriminate on the grounds of age constitute age discrimination within the meaning of the Act.
WHO IS COVERED?
All employees – regardless of age – are covered by the prohibition against age discrimination. For example, if a 25-year-old candidate applies for a job but is rejected because the employer prefers a candidate who is 28 years of age and the decision to reject the 25 year-old candidate was fully or partly based on age, the 25 year-old candidate may claim age discrimination under the Act.
The Act is applicable to job candidates and employees only. However, the question of whether or not the protection afforded by the Act also extends to managing directors is the subject of much discussion between employment law experts. Managing directors are not covered by ordinary employment legislation in Denmark, but the Danish Ministry of Employment has announced that the Act should be interpreted to also offer protection against age discrimination to managing directors. There has been some opposition to this approach by employer organisations and it is expected that the issue will have to be decided by the courts.
There is an exception for servicemen and those serving in the military. The Act provides the Danish Minister for Defence with the option of excluding the armed forces from the prohibition against age discrimination. This option was exercised by the Minister for Defence in 2008.
WHAT ENFORCEMENT/REMEDIES EXIST
The courts can impose a fine on employers in cases of age discrimination where it is, for instance, stated in job advertisements that candidates of a particular age will be preferred. This is a criminal sanction.
Employees who have been discriminated against at work are entitled to compensation. The Act does not put a cap on the amount of compensation which may be awarded. Employee organisations are putting pressure on the level of compensation by generally claiming compensation of up to 18 months’ pay in the cases currently pending before the courts. However, the compensation awarded generally amounts to 3-12 months’ pay in cases of dismissal and DKK 25,000 in cases where the discrimination has taken place in connection with a recruitment situation.
In cases of dismissal, the size of the compensation awarded depends on factors such as the employee’s length of service and whether any mitigating factors are present. As a general rule, the courts will award a compensation equivalent to 6-12 months’ pay. But if, for instance, discriminatory criteria used for selecting employees for redundancy are set out in an agreement between the employer and a trade union, the courts have in some situations awarded compensation below this level. Depending on the circumstances, the fact that the redundancy was necessary due to labour shortage may also constitute a mitigating factor.
In a discrimination claim, the employee is not required to demonstrate a loss to be awarded compensation. Case law shows the compensation awarded by the courts is independent from any financial loss that the employee may have suffered.
HOW COMMON ARE CLAIMS?
In the last few years, the Danish Supreme Court has decided several precedent-setting cases which will, most likely, reduce the number of age discrimination claims.
WHAT CLAIMS ARE MOST COMMON AND WHAT ARE THE TRICKIEST ISSUES FOR EMPLOYERS?
The most common claims concern:
Employees affected by collective redundancies claiming that age was part of the reason for making them redundant;
Discrimination in the recruitment process;
Compulsory retirement ages in collective agreements and individual contracts. In this context, the judgment by the European Court of Justice (the “ECJ”) in C-499/08 has resulted in a high number of claims regarding the right to severance pay under the Danish Salaried Employees Act. The case is described below.
ARE THERE ANY SPECIFIC EXCEPTIONS IN YOUR LAWS?
Age discrimination may be justifiable in the following situations:
Existing provisions (i.e. provisions already in force when the prohibition against age discrimination was implemented in December 2004) on age limits in collective agreements (including mandatory retirement ages) can be maintained, provided that they are objectively and reasonably justified by a legitimate aim and that the means of achieving that aim are appropriate and necessary.
If an employee under the age of 18 is covered by a collective agreement allowing payment of a lower pay to under-18s, the employment is not covered by the prohibition against age discrimination. This means that the employer may prefer candidates under the age of 18 for certain types of jobs and that the employer may dismiss the employee when she/he reaches the age of 18. It may be mentioned that the Supreme Court gave its ruling on 14 November 2013 in a case concerning the exception in the Act regarding under-18s. An employee organisation claimed that the exception in the Act regarding under-18s is in contravention of the Directive, but the Court ruled that the exception is not in contravention of the Directive.
Due to an amendment of the Act, all provisions in individual contracts stipulating a mandatory retirement age became void from 1 January 2016 unless the mandatory retirement age is based on a lawful provision in the applicable collective agreement.
Employers are allowed to implement special measures to promote job opportunities for seniors.
In order to protect children and young people, lower age limits on employment may be laid down by law.
The protection against age discrimination does not apply to under-15s unless the employment is covered by a collective agreement.
Employers may apply for and be granted a specific exemption (by the relevant minister) if it is crucial in a specific profession that an employee is of a particular age.
According to the explanatory notes to the Act, benefits provided on the basis of length of service are generally acceptable so long as the employer’s reasoning for providing such benefits was not to discriminate against younger employees. Recent case law on length of service concerns a case where dismissals of pilots were based on lists in which the pilots were primarily placed according to their length of service and, secondarily, their age. The Supreme Court found the dismissals discriminatory due to the fact that age was part of the selection criteria and, accordingly, awarded the pilots a compensation of 6 months’ pay.
With effect from 1 January 2016, it is no longer possible for Danish employers to justify a compulsory retirement age in an individual contract.
As a result of this amendment, clauses in individual contracts which stipulate a compulsory retirement age became invalid and unenforceable from 1 January 2016. This applies to all individual contracts, unless the mandatory compulsory retirement age is based on a lawful provision in an applicable collective agreement. Consequently, it is necessary to change all employment contracts which set out a compulsory retirement age.
A compulsory retirement age stipulated in collective agreements concluded before 28 December 2004 will continue to apply, provided that the provision is objectively and reasonably justified by a legitimate aim and that the means of achieving that aim are appropriate and necessary. As an example, the Danish Board of Equal Treatment has deemed a compulsory retirement age of 56 for opera singers reasonable due to the natural but significant changes in the voice for people between the age of 51 and 55.
Case law shows that the Danish courts attach importance to statistical data about the age of rejected candidates or dismissed employees. Thus, the comparison between the age of a rejected candidate or dismissed employee and the average age of all candidates or employees is an essential part of the courts’ assessment of the actual circumstances that can create a presumption of age discrimination. This type of cases is extraordinarily challenging for employers as they are often required to present significant amounts of statistical data to succeed.
In 2010, the ECJ gave judgment in C-499/08 on whether the Salaried Employees Act is at odds with Articles 2 and 6 of the Directive. According to an earlier version of the Salaried Employees Act, no severance pay is payable if the employee, on termination of the employment relationship, is entitled to receive old-age pension that has been financed by the employer and the employee has joined the pension scheme in question before reaching the age of 50. The Court found that the provision is based on a criterion which is inextricably linked to the employees’ age and, consequently, constitutes age discrimination. The Danish court ruled in accordance with the ECJ.
From 1 February 2015, the right to severance pay under the Salaried Employees Act no longer depends on age.
However, at the time some cases against private sector employers regarding dismissals carried out before 1 February 2015 were still pending. In one of the cases, the Supreme Court requested a preliminary ruling from the ECJ, asking the ECJ to decide whether or not the rule in the Salaried Employees Act according to which no severance pay is payable to an employee if she/he is entitled to old-age pension is contrary to the general principle of prohibition of discrimination on the grounds of age. The ECJ replied that the provision of the Salaried Employees Act was incompatible with this principle. Therefore, the Supreme Court should refrain from applying the provision.
Furthermore, the ECJ was asked to decide if it is contrary to the general principle of legal certainty to require a private employer to pay severance pay notwithstanding the provision in the Salaried Employees Act which stated the direct opposite. In this regard, the ECJ replied that the general principle of legal certainty is not sufficient to set aside the principle of equal treatment.
The Danish Supreme Court held that the Danish legislator with the Act on the Accession of Denmark to the European Union did not foresee a situation where such a general principle – not enshrined in the wording of the Treaty – should be given precedence over Danish law incompatible with the general principle prohibiting discrimination on grounds of age.
The Supreme Court relied on the preparatory work of the Act on the Accession of Denmark to the European Union and found that general principles inferred from Article 6 (3) have not been made directly and immediately applicable in Denmark.
Accordingly, the Supreme Court ruled in favour of the employer who was entitled to refuse to pay in reliance on the Salaried Employees Act.
Finally, it should be mentioned that the Supreme Court has given judgment in a case regarding an occupational pension scheme. The question in the case was whether a pension scheme where the size of the pension contributions is gradually increased on the basis of the employees’ age constitutes age discrimination. The ECJ answered several questions in this case in a preliminary ruling (C-476/11). The Supreme Court held that the gradual increase in the pension contributions was in accordance with the Act. One of the reasons was that all the employees were treated equally during a full career path in the company and that the scheme gave equal rights to employees regardless of the time of hiring.