After the most difficult negotiations: Wage increases come into effect for employees in these sectors
After lengthy negotiations and mediation by a so-called "mediator"—a state-appointed team that facilitates negotiations between the parties—the HK Handel trade union and the Dansk Erhverv employers' organization finally reached a new agreement, announced Wednesday. This agreement will increase wages for employees in several sectors, including those earning the minimum wage, retail workers, transport workers, and those in the financial and banking sectors. Reaching this agreement is considered to have averted widespread strikes and a general shutdown in Denmark, as the unions had the right to strike until a new agreement was reached with the employers' organization. The negotiations were described as difficult, particularly given the unions' desire to raise employee wages due to inflation, while businesses were also grappling with inflation and rising costs. For example, the minimum wage for retail workers will increase by approximately 101 TP3T to 121 TP3T over two years.
These are the main points of the agreement reached between the HK Handel trade unions and the Dansk Erhverv employers' organization, according to local media reports on Wednesday:
- The so-called “zero-hour” contracts for store employees have been discontinued, and instead a new, flexible, part-time job is contracted. Employees can be employed in the store agreement either full-time or part-time with fixed hours, or flexible part-time work, with 8-13 hours specified, for example, instead of “zero-hour” contracts, which obliged the employee to accept the contract without any guarantee that the employer would give him a minimum number of working hours. Approximately 10% of the part-time employment contracts for store employees were “zero-hour” contracts.
- Flexible part-time work is intended for specific groups such as young people under the age of 18, students and part-time workers, where the employee can be employed in two different time periods to work from 8 to 15 hours per week or from 13 to 20 hours per week, and this ensures a minimum of 8 hours of work per week.
- Dealing with zero-hour contracts also means that employees working flexible part-time will be covered under the Civil Service Act and therefore receive guaranteed pay during illness, as well as a longer notice period.
- The minimum wage for both skilled and unskilled workers will increase by 721 Danish kroner per month from 1 March 2023 and by 721 Danish kroner per month from 1 March 2024 as part of the collective agreement. The increase will amount to 4.50 kroner per hour, equivalent to 721, and will benefit more than 150,000 employees (in stores such as supermarkets, IKEA, shopping center stores, etc.).
- Thus, the increase will be 2% to a total of 9% in 2024.
- Employers must pay 2% more in pensions to their employees, and employees will pay 2% less in pensions. In this way, employees save this percentage, but at the same time they receive more 2% in salary.
- As part of local wage negotiations, a trade union representative will be able to request information about the employer's conditions – including production levels, financial conditions, and more.
Source: HK Handel
Financial sector employees:
Key points of the new agreement for financial sector employees:
- The agreement is valid for two years and will continue until March 31, 2025.
- The agreed wage increases are 4.5% in 2023 and 3.7% in 2024.
- Maternity and paternity leave for partner fathers and mothers is extended by 10 weeks, bringing the total to 26 weeks with full pay and pension.
Transportation sector employees:
Details of the wage increase are expected to be announced before the end of Wednesday.
Construction sector employees:
Wages are being negotiated and negotiations are likely to continue over the weekend.
