Holiday pay in the event of bankruptcy, cessation of operations and restructuring

Are you due to take a holiday, and has your employer gone bankrupt, ceased operations or under restructuring?

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You will accrue 2.08 days of holiday per month. 

Up to and including 31 August 2019

Up to and including 2018, you accrue holiday pay from your gross salary for the entire calendar year. In 2019, you will accrue holiday pay from your gross salary, but only from the period 1 January 2019 to 31 August 2019.  

Transition to the new Danish Holiday

Act Before the new Danish Holiday Act enters into force, there will be a transition year which runs from 1 September 2019 to 31 August 2020. In this period, you will still accrue holiday pay from your gross salary. The holiday you accrue in the transition year will be transferred to a savings account with Lønmodtagernes Feriemidler. 

The new Danish Holiday Act 

On 1 September 2020, we got a new Danish Holiday Act which makes it possible to take holidays already from the month after they were accrued. You still accrue holiday pay from your gross salary, but in the period from 1 September to 31 August the year after.

Up to and including 31 August 2019

Holidays accrued up to and including the 2018 calendar year are taken in the holiday year from 1 May to 30 April the year after. Holiday accrued from 1 January 2019 up to and including 31 August 2019 can be taken in the holiday year from 1 May 2020 to 30 September 2020.  

The new Danish Holiday Act

On 1 September 2020 we got a new Danish Holiday Act which makes it possible to take holidays already from the month after they were accrued. With the new Danish Holiday Act, you accrue holidays from 1 September to 31 August the year after. You can take your holiday from 1 September to 31 December the year after. In other words, you have 16 months to take the holidays.  

Transition to the new Danish Holiday Act 

In the transition year from 1 September 2019 to 31 August 2020, LG calculates and reports 12.5 per cent in holiday pay from your gross salary to Lønmodtagernes Feriemidler. The holiday supplement of one per cent is part of your holiday pay. If you are entitled to more than a one per cent holiday supplement, LG processes or pays the higher holiday supplement that has been agreed as per your collective agreement, employment contract, etc.  

The holiday supplement is normally 1 per cent of the wages that qualify for holiday with pay from the most recent calendar year. 

The holiday supplement constitutes a part of the 12.5 per cent holiday allowance. 

If you receive holiday allowance from LG, you will not receive any holiday supplement.

Your employer may have notified you that you must take any remaining holiday during your notice period. If no notice is given, notice will be given automatically when you are released from your duties. 

  • You must take your main holiday if three months' notice plus your holiday can be accommodated up until the end of your notice period.
  • You must take your remaining holiday if one month's notice plus your holiday can be accommodated up until the end of your notice period. 

LG can schedule your holiday in the termination period. In other words, LG views your holiday as being taken in the termination period regardless of whether you take those days off or not. You do not accrue holiday pay while on holiday.  

The new Danish Holiday Act

On 1 September 2020 the new Danish Holiday Act entered into effect, which allows for the possibility of taking holidays already the month after they have been accrued. The holiday you accrue from 1 September 2020 can therefore be scheduled month by month in your termination period based on the notices on one and three months plus the holiday. If you have holidays that you are not taking between 1 May and 30 September 2020, they will automatically be transferred over to the new holiday year. These holiday acts can be considered as having been taken during your termination period.  

Main holiday and remaining holiday

Up to and including 31 August 2019, you will accrue: 

  • A main holiday the first 15 days 
  • Remaining holiday for the other days 

From 1 September 2020, you will as a general rule accrue: 

  • Remaining holiday the first 10 days 
  • Main holiday the other days

LG can only grant holiday allowance or paid holiday corresponding to the number of days of holiday that you have accrued from your employer. 

On the 'Dokumentation for indtægt og jobsøgning' (Documentation for earnings and job search) form which LG sends to you, you must indicate when you have taken holiday during your notice period.

If your bankrupt employer was a member of an employer’s association that has a holiday guarantee scheme, they will pay your holiday pay. 

Many different schemes manage and disburse holiday allowances. If you have a holiday card, you must contact the holiday guarantee scheme stated on your holiday card.

The Employees' Guarantee Fund (LG) ensures that employees receive wages etc. when their employer is declared bankrupt, ceases operations or under restructuring. If your employer undergoes restructuring, LG can help employees who have been terminated and released from their duties. LG can also help the employer to pay wages to employees working for the company, while it is subject to financial reconstruction. 

If you do not agree with LG's decision 

The legislation to which LG is subject falls within the Danish Ministry of Employment, but you cannot complain about the decision to the Ministry. 

If you do not agree with LG's decision, you are welcome to contact us and possibly send further documentation supporting your claim. LG will review your case and send you a new decision. 

If you still do not believe that our decision is correct, you will have to initiate legal proceedings against LG at the courts. LG has no appeals board, and therefore the case can only continue at the courts. In this case, you must contact the court in Hillerød. 

Contact the customer ambassador

If you are dissatisfied with the service you received from LG, you can contact ATP's customer ambassador: 

Last updated: 15 August 2021

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