Work permit scheme and ID card requirement bills adopted

Following our newsletter from June 30^th 2025, the Danish parliament has today adopted two significant bills that will affect foreign employees and companies operating in Denmark. In this newsletter, we will provide an overview of the changes and highlight key considerations for employers to ensure ongoing compliance.

New Collective Agreement–Based Business Scheme (Erhvervsordning)

The new business scheme has now been formally adopted. It is intended for certified companies that provide fair pay and proper working conditions and are covered by a relevant collective agreement, enabling them to recruit foreign workers to Denmark. The aim is to make it easier to hire certain foreign nationals while maintaining Danish labour standards.

How can a Danish company become certified

Danish companies wishing to use the scheme must firstly obtain a certification with the Danish immigration authorities. The conditions for obtaining this certification are the following:

• At the time of the certification there must be at least 10 full-time employees employed on a permanent basis working for the Danish company.
• The company must comply with the Danish Aliens Act.
• The company must not be involved in a legal labour dispute nor have any enforcement notices from the Danish Working Environment Authority.
• Be covered by a collective agreement and may only employ foreign workers under the scheme in positions that fall within such agreements.
• Have elected employee representatives or entered into a separate agreement with the relevant employee organization granting access for control.
• Not, within the past two years, have been ordered by the Labour Court or by industrial arbitration to pay a penalty for underpaying foreign workers.
• Submit a service certificate issued by the Danish Business Authority (Erhvervsstyrelsen) or equivalent documentation.
• Have been in operation for a minimum period for at least two years and have submitted an annual report.

Who can be hired under the scheme?

The scheme can be used for foreign employees who:

• Are offered a position with an annual salary of at least DKK 322,000 (2026 level),
• Are employed in a position covered by a recognized collective agreement, and
• Come from specific third countries with which Denmark has an economic and trade partnership.

The employee must be a citizen of one of the following countries: 

Effective from: 1 January 2027

Mandatory ID Cards on large construction sites

The new requirement for ID cards on large construction sites has now been formally adopted. The rules apply to construction and civil engineering projects with a total project value exceeding DKK 100 million. The bill has now been formally adopted.

Who must have an ID card and what must it contain?

All employees present on covered construction sites must carry a personal ID card. As a starting point, the ID card solution will be app-based but final discussions will be held at a later point, now that the proposed bill has been adopted.

The ID card must include at least:

1. Name
2. Photo
3. Nationality
4. Danish civil registration number (CPR) or equivalent unique ID, if no CPR
5. Residential address, where the employer provides accommodation under the Act on Housing of Employees
6. Job function
7. Mandatory training under health and safety legislation, or equivalent qualifications recognized by the Danish Working Environment Authority
8. Employer information: name, CVR number and, if applicable, RUT number
9. In the case of hiring-out/agency work: information about the company that has engaged the cardholder
10. Date of issue of the ID card

Responsibility of the project owner

The rules adopted make the project owner (bygherre) responsible for:

• Administering ID cards on the construction site, and
• Reporting ID card data to the Danish Working Environment Authority.

Regarding the monitoring of companies linked to the ID card, the new rules will also allow the Danish Tax Agency to exercise better control over whether a foreign company has activity in Denmark to constitute a permanent establishment. The Tax Agency will also be able to verify whether the company stated on the card as the cardholder’s employer has correctly registered the cardholder as an employee and reported the salary income.

As a result, it is now more important than ever for employers to ensure full compliance in all relevant areas, including tax, immigration, permanent establishment, payroll and social security.

Effective from: 1 January 2028 or 1 January 2030, depending on how the ID card solution is phased in. 

Do you need support?

At KPMG Acor Tax, we have a global immigration practice covering 150+ countries with more than 1,800 immigration experts. We offer a full spectrum of immigration-related services.  

Please contact us if you have any questions or need our assistance.