Sick Pay and Layoff Terms During COVID-19 (Part 4: Denmark & Norway)

We continue our series of articles by looking at what special procedures the global payroll profession must carry out in each country their employees operate, and what government support is available for businesses hit by the COVID-19 pandemic. In this article we turn our attention to Denmark and Norway.

We encourage you to visit previous installments of this series, linked below:

For more information on country specific changes as they happen visit CloudPay’s COVID-19 and Global Payroll Hub.


The traditional restrictions on what an employer could ask an employee concerning a sickness absence have been reversed. Usually, an employer is not allowed to ask an employee why they are off sick. However, with covid-19 the employee has a duty (and the employer has a right to ask) to tell the employer that the absence is caused by coronavirus. The employer must then ask exposed colleagues to be examined for the virus, and if necessary they will need to be quarantined. Employers are now also allowed to examine employees on arrival at work for signs of fever – for example by using an ear thermometer. An employee who is absent because of covid-19 (whether because they are sick or self isolating on contact with a sufferer) is subject to the usual rules on sick pay.

Many companies are seeing significant downturns in work and are having to lay off staff. In order to prevent this leading to a wave of redundancies, the government has announced a plan to provide support for salary costs. The plan is being administered by the Danish Business Authority (Erhvervsstyrelsen), with a number of different schemes being offered.

For those employers who have had to lay off workers altogether, salary compensation can be claimed in one of two circumstances:

  • When the employer puts at least 30% of employees under redundancy notice
  • Or where this is potentially threatening at least 50 employees

The scheme requires the employer to not make the employees redundant and to continue paying them in full. The state will then fund a varying percentage of pay up to a monthly maximum of DKK 30,000 – this is based on a 37 hour week and is reduced on a pro rata basis for part timers. The percentages are:

  • 75% for salaried employees (funktionærer)
  • 90% for non salaried employees (ikke-funktionærer)

The scheme will run from 9th March to 8th June 2020 initially, and employers make only one application for support under it. The aim is for a significant audit to be undertaken after the event and the application requires a line per employee detailing pay and contract details. The company must apply for the compensation itself via a relevant Nem ID, it is not possible to use an adviser. Funding will be paid directly to the company’s NemKonto account.

Help is available for other costs as well. For covid-19 absences, the usual requirement for the employer to fund the first 30 days of sickness absence is waived, and reimbursement may be claimed from day one of absence – with this provision being made available until 31st December 2020. For those employers covered by an unemployment insurance fund the requirement to pay G-Days for between 2-16 days of unemployment is also waived.

Lastly, Skat is allowing an extension to the payment deadline for Labour Market Contributions (LMC) and A-tax collected from the payroll run. For all employers the payment deadline shifts back by 4 months over the next quarter. It should be noted however that the reporting deadline for e-income taken from the payroll run remains unchanged. The Danish rules can be viewed here.



The country has suffered a lower rate of infection than most other European countries, but nevertheless has been sufficiently impacted by covid-19 for the government to introduce a number of support measures. With the closing of schools, parents have been given permission to use their right to stay home with a sick child (omsorgsdagene) to care for children. Usually this right requires the employer to pay the employee full pay for up to 10 days per year at their cost. The employer’s liability for the cost of this leave has been reduced to three days, and the amount of leave available has been doubled to 20 days (the last 17 days being funded via social security). For those who are off work sick with covid-19 the employer remains liable to pay for the first 16 days of absence, but the costs of day 4-16 will now be reimbursed back to the employer by NAV (the social security authority) until 31st December 2020. Other sickness absence which is non covid-19 linked remains payable under the usual arrangements, so the employer must be able to differentiate between sick leave cases on the cause of the absence. There is a nine month window in which to apply to NAV for the reimbursement of sick pay made to employees.

CloudPay Dealing with the Pandemic

Norway already had a comprehensive layoff system before the crisis known as Permittering, but the rules on this have been eased. The usual notice period of layoff has been reduced from 14 days to two days. Where the employer proposes to lay off more than 50 employees consultation must be taken with the relevant union. Employers should also note the obligation to inform NAV where 10+ employees are being laid off or are having working hours reduced by more than 50% for more than four weeks – a new electronic tool for this purpose is available here. The usual scheme requires the employer to pay full salary for the first 15 days of layoff but this requirement has also been reduced to two days. After this time the employer will pay full salary up to 6G. The G stands for Grunnbeløpet and is a unit used by NAV for setting social security benefits – which are quoted as multiples of G. The current monthly 1G value is NOK 8,322 so the cap set on support for monthly salary is 6 x 8,322 = NOK 49,532. After the 20 days have elapsed the employee will receive an unemployment benefit from NAV until the layoff is completed, and the amended rules apply until 31st October 2020. The maximum period of time that Permittering may be used remains set at 26 weeks spread over an 18 month rolling period. Details are available on the NAV website here.

The government has also opened a compensation scheme for businesses which have suffered a reduction in turnover of at least 30%. The scheme differentiates between those businesses ordered to close (such as restaurants and hairdressers) and others who remain open but have seen turnover plummet. It will cover up to 90% of fixed costs (which includes salaries for people not laid off) depending on whether the business is subject to compulsory closure or not. The initial period of support will run from March to May, and the application process will be made available by the Tax Administration. Details on the scheme are available here. Skatteetaten have also announced extensions to payment deadlines of several months for the payover of payroll taxes, and the government is currently contemplating a mid year alteration (downwards) to employer national insurance contributions which would take effect from May. The situation is fast changing and employers are advised to check the Skatteetaten website advisory.