Labor law penalties for breach of collective bargaining agreement generally expire after 3 years
How long can a labor union wait to file a claim for a penalty for breach of a collective bargaining agreement? In a new ruling dated September 22, 2026, the Labor Court has determined that claims for penalties for breach of a collective bargaining agreement are subject to the Danish Statute of Limitations Act andexpire after 3 years. The ruling provides important clarification regarding the rules on the statute of limitations for claims for penalties and the significance of employees’ knowledge of the circumstances on which the claim is based.
The case concerned violations of rules regarding working hours and days off
The case arose from violations of the collective bargaining agreement’s rules on working hours and days off, which led FOA to file a claim for a penalty for breach of the collective bargaining agreement against Danske Regioner.
The key questions before the Labor Court were whether a claim for a penalty was subject to the Danish Statute of Limitations Act, and if so, which statute of limitations period applied. Under the Danish Statute of Limitations Act, the general statute of limitations is three years, but certain claims arising from an employment relationship are, as a general rule, subject to a special five-year period.
FOA’s claim for a penalty arose from breaches of the provisions in the parties’ working time agreement during the period 2012–2014
FOA argued that the claim for a penalty not subject to the statute of limitations. Danske Regioner, on the other hand, argued that the claim was subject to the 3-year statute of limitations and was already lapsed.
The statute of limitations for penalties for breach of a collective bargaining agreement was 3 years
The Labor Court first ruled that the Danish Statute of Limitations Act also applies to claims for labor law penalties for breach of a collective bargaining agreement. In doing so, the court emphasized that such a claim must be considered a monetary claim falling within the scope of the Danish Statute of Limitations Act.
As the penalty claim related to the breach of the collective agreement was not based on an agreement concerning the performance of work as part of an employment relationship, the special five-year limitation period did not apply.
. Instead, the claim was subject to the general 3-year statute of limitations.
The Labor Court also ruled that the statute of limitations period should be calculated from the date of the breach of the collective bargaining agreement. The fact that the amount of the penalty is first determined by the Labor Court could not result in the statute of limitations period not beginning to run until a later date.
The Employees’ knowledge precluded suspension of the Statute of Limitations Act
The Labor Court further examined whether the limitation period had been suspended on the grounds that FOA had been unaware of the circumstances underlying the penalty claim.
If a creditor is unaware of their claim, the Danish Statute of Limitations Act provides that the statute of limitations is not calculated until the time when the creditor became aware or should have become aware of it.
However, FOA could not base its claim solely on the organization’s own lack of knowledge regarding the breaches of the collective bargaining agreement. The Labor Court found that, in assessing the statute of limitations, FOA must be regarded as acting on behalf of the employees affected by the breaches.
The Labor Court emphasized that the rules regarding working hours and days off were so significant to the employees’ daily lives that they should have been aware of the violations. The Labor Court therefore found that there was no basis for suspending the statute of limitations. Thus, the claim for penalty was lapsed, and Danske Regioner was acquitted.
Littler notes
The ruling clarifies two key issues regarding the statute of limitations on claims for penalties arising from breaches of collective bargaining agreements. First, the Labor Court establishes that claims for labor law penalties are covered by the Statute of Limitations Act and they are subject to the standard three-year statute of limitations. Second, the ruling shows that the assessment of suspension is not necessarily based on the labor union’s knowledge of the breach of the collective bargaining agreement.
The Labor Court thus held that, when assessing the issue of suspension of the statute of limitations, a labor union have the same rights as the employees affected by the breach of the collective bargaining agreement. If the employees knew or should have known the circumstances on which the claim for a penalty is based, the union will not necessarily be able to invoke its own lack of knowledge as grounds for suspension.
The ruling therefore emphasizes the importance of identifying and pursuing potential breaches of the collective bargaining agreement in a timely manner, as claims for labor law penalties otherwise risk becoming lapsed.
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Disclaimer: The above is not, and cannot replace, legal advice.
Reference to the judgment: https://arbejdsretten.dk/media/hcrd2mby/arbejdsrettens-dom-af-22-september-2026.pdf
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Christian Bonne Rasmussen
Attorney & Partner
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