The Confederation of Danish Industries and the CO Industri union grouping reached agreement yesterday on a two-year collective bargaining agreement which, among other things, increases the minimum wage by DKK 1.35 per hour – about a one per cent wage increase, with inflation at 2.8 per cent in January.

The agreement covers 240,000 employees in 6,000 companies, and apart from increasing the minimum wage includes better conditions on layoffs and an increase in pension payments to include evening and weekend shifts.

Employees will also be able to consolidate further education so that two annual weeks of further education can be collected over time for up to six weeks.

“Industrial actors have reached an agreement which gives 240,000 people in 6,000 companies a new collective agreement. It is extremely positive that the parties have been able to reach agreement,” says Social Democratic Finance Policy Spokesman John Dyrby Poulsen.

“We cannot afford excesses, but it is good for Denmark and the Danish economy that this part of the Danish model has yet again proved its potential,” Dyrby Poulsen adds.

Flemming Ibsen, a labour market researcher at Aalborg University says competitiveness has been at the centre of the negotiations.

“Employers have been going for a low agreement that doesn’t cost much for companies in order to improve competitiveness – and that is something that is quite obvious from the result,” Ibsen says, adding that if local agreements follow Sunday’s agreement, Danes are looking at a drop in real wages.

The unions involved say the result is what could be achieved.

“This is the best we could negotiate given the crisis we are in. I will be recommending the agreement (Ed: to my members) as we have achieved some improvements in pensions and parental leave and avoid a fixed salary system by which people work without an upper working hour schedule,” says Gita Grüning, chair of the National Technical Association (Teknisk Landsforbund) which has 30,000 members.

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