Employers are under obligation to report and pay into the Labor Market Holiday Fund any unused holiday pay for employees relating to the qualifying year. The report is the employer’s documentary evidence that it has settled the holiday accounts for hourly-paid employees, former salaried employees and monthly-paid employees in continued employment who have paid leave (i.e. the value of holidays that have not been taken).
The Holidays Act contains a basic principle that an employee must take his or her accrued holiday. If holiday is not held during the holiday period, the employee, is in principle not entitled to receive holiday pay for the period of unused holiday. Likewise, the employer cannot keep the holiday pay either.
The holiday period includes the holiday year from which the holiday is earned and the subsequent 4 months from the end of the holiday year to the end of the calendar year. The holiday year runs from 1 September to 31 August.
If an employee has not taken his or her full holiday entitlement, the holiday pay relating to the unfinished holiday must, as a starting point, be reported and paid into the Labor Market Holiday Fund. However, special rules apply in the event of the employee being prevented from taking holiday, the employees’ resignation and the transfer or payment of holiday beyond 4 weeks.
The reporting and payment of the excess holiday must be made no later than 15 November after the end of the holiday year.
The rules on reporting and payment of unclaimed holiday pay to the Labor Market Holiday Fund only apply to holidays in accordance with the rules of the Holidays Act (corresponding to 25 days for employment in a full earning year) and thus not additional holiday entitlement.
Even if all the employees have taken the full holiday, DKK 0 must still be reported.
Depending on the agreement with the employee, there may also be different arrangements on settlement to a private holiday fund. If it appears from the agreement that a settlement is to be made to a private holiday fund, DKK 0 is also reported to the Labor Market Holiday Fund.
Transferred or paid holidays
If the employer has entered into a written and dated agreement with an employee prior to the end of the holiday year (30 September) on payment or transfer of (up to 5) holiday days, these holiday days should not be reported.
The legal basis
The ‘old holiday law’ still regulates holiday earned before the ‘new holiday law’, which entered into force on 1 September 2020 cf. section 47 (1) of the Holiday Act. 4. That is, all holidays accrued prior to the new Holiday Act entering into force must have been notified to be taken in whole or in part in September 2020. This also applies to holidays accrued under the old Holiday Act, if they haves not been transferred to be held under the new Holiday Act.
Holidays that have not been notified for September 2020 or accrued from 1 September 2020 are covered by the new Holiday Act.