New business scheme aims to ease labour shortages in Denmark

On 30 June 2025, the Danish Government introduced a political agreement to implement a new business immigration scheme aimed at facilitating the recruitment of qualified labor from selected non-EU countries by Danish enterprises.

Significant reduction in the pay limit scheme

A central feature of the initiative is the adjustment of the so-called pay limit scheme, the statutory minimum salary that foreign nationals must be offered to obtain residence and work permits in Denmark.

For employment arrangements covered by the new business scheme, the annual salary threshold will be reduced from DKK 514,000 to DKK 300,000. The intention is to remove existing barriers to recruitment in sectors where the former threshold has posed a challenge, particularly for small and medium-sized enterprises operating within growth and production industries.

Scheme limited to 16 specific countries

The scheme is geographically limited to workers from the following 16 countries outside the EU: the United States, the United Kingdom, Singapore, China, Japan, Australia, Canada, India, Brazil, Malaysia, Montenegro, Serbia, North Macedonia, Albania, Ukraine, and Moldova.

According to the Ministry of Employment, the selection of these countries reflects a strategic focus on targeted recruitment from jurisdictions with which Denmark already maintains established economic, political, or labour-related partnerships.

Conditions and eligibility requirements for employment

The scheme is subject to a number of conditions designed to ensure that employment relationships are both structured and subject to effective oversight. Notably, foreign candidates must not have committed certain categories of criminal offences within the two years preceding the time of application.

Furthermore, eligibility is restricted to companies that are party to a collective agreement concluded between the Danish Confederation of Trade Unions (FH) and the Confederation of Danish Employers (DA), and which employ at least ten full-time employees.

Anti–social dumping measures

As part of a broader strategy to combat social dumping, the scheme also introduces additional measures are also being introduced, including strengthening control measures for trade unions, legal requirements for the use of labour clauses in public tenders and an obligation for foreign workers to carry ID cards when employed on construction and infrastructure projects with a total contract value exceeding DKK 100 million.

This measure is intended to ensure that foreign labour is not engaged under conditions less favorable than those applicable to Danish workers. In doing so, the initiative aims to reinforce and safeguards the Danish labour market model, under which wages and working conditions are determined through collective bargaining.

Littler notes

It is a novelty that the government is proposing to differentiate between countries when it comes to granting residence and work permits. The scheme will make it possible to recruit employees for lower-paid jobs from countries outside the EU, where previously it has been mainly high-paid employees who have been able to obtain work- and residence permits.

In addition to easing the conditions for residence and work permits for certain third-country nationals, the political agreement also includes a number of measures to curb social dumping and control wage and employment conditions. This includes giving trade unions additional control options, which is an area in which the legislator has not previously interfered.

Littler | Denmark is following the implementation of the scheme closely.

Disclaimer: This article is not and should not be considered legal advice.