The state sector is an integral part of the Danish labour market. A number of the characteristics of central government apply to the entire Danish labour market.
The Danish collective bargaining model
Collective agreements between the labour market parties are a significant element of the Danish labour market. The point of departure is that as long as the labour market parties themselves are able to reach agreement, the Government will intervene as little as possible in the employees' conditions. This is the key aspect of the traditional Danish model.
The Danish labour market is, generally, characterised by a very high rate of organisation both among employers and employees, as well as a very long history of mutual recognition of employers' associations and trade unions.
The origins of the present collective bargaining and agreement system lie in the private sector with the September Agreement of 1899. After long and hard dispute, employers and employees agreed that it was a matter of mutual interest to establish more formalised ways of cooperation and to mutually recognise each other. The fundamental agreements reached at that time remain in force today.
It is, therefore, a characteristic of the Danish labour market - both the public and private sectors - that it is based on the conclusion of collective agreements subject to negotiation between employers and employees through their organisations. Collective bargaining rights rest on the general agreements concluded between representatives of the employers and employees as well as on Normen (the code of practice governing the resolution of industrial dispute).
The parties decide the length of the agreement period on each occasion. In the public sector area, the parties have agreed upon periods of three years' duration since the late 1990s. During the agreement period, the parties are subject to a no- strike agreement, which means that they cannot lawfully call a strike. The Industrial Court settles disagreements in connection with breaches of the agreements, including strikes in contravention of the collective agreement, whereas questions regarding the interpretation of the collective agreements are settled by industrial arbitration.
In connection with bargaining regarding the renewal of collective agreements, the parties may issue a strike notice or initiate lockout in order to put pressure to bear on the negotiations. Before a strike can take place, the parties are required to endeavour to reach an agreement, if necessary with the assistance of the State Conciliation Board on Labour Disputes.
Terms of pay and employment that are agreed through collective bargaining apply also to non-unionised employees within the same sector.
In the public sector, there is a consensus that the implementation of EU directives on labour market and social-related issues is to take place, whenever possible, within the framework of the Danish model i.e. through collective agreements.
Legislation
The relationship between the employer and the individual employee is as a main rule regulated by collective agreement. There are, however, a number of labour market laws which regulate the terms that apply to special groups of employees or apply to special situations. An example of the former is the Civil Servants Act and the Civil Servants' Pension Act. Examples of the latter are the Holiday Act, the Salaried Employees Act, the Equal Treatment Act, the Equal Pay Act, the Working Environment Act and the legislation regarding maternity leave. These laws cover employers and employees in both the public and private sectors.
