UNDERSTANDING YOUR PAYSLIP Personnel legal consultant, Jens Kristian Birthin, tel. 87153325, e-mail; jkb@adm.au.dk Head of payroll office, Bente Rud Pedersen, tel. 87152292, e-mail: brp@adm.au.dk Deputy head of payroll office, Tim Strandgaard Laursen, tel. 87152291, e-mail: tsl@adm.au.dk Payroll officer Anita Kaae Rasmussen, tel. 87152298, e-mail: ar@adm.au.dk For information about your payroll case manager in the four academic areas see: http://medarbejdere.au.dk/administration/hr/
WHY IS IT IMPORTANT TO UNDERSTAND YOUR PAYSLIP? Payslips are complicated but they contain important information. Important to doublecheck in order to be sure that you receive the right salary, the right pension contribution, the right deductions etc. The university puts a lot of effort into making sure that the payslips are correct, but mistakes will happen. It is also your responsibility to check that your salary is correct. 2
DIGITAL DENMARK Digital Denmark. NEM-konto. NEM-ID (necessary to order a code and a code card in order to be able to log on to E-boks). E-boks (where to find your payslip) www.e-boks.dk 3
DIGITAL DENMARK AND NEM-KONTO Digital Denmark. Decision by the Danish Government. No more printed forms or letters. NEM-konto. All citizens must have a NEM-konto. How to assign a NEM-konto. Foreign NEM-konto. Visit www.nemkonto.dk 4
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NEM-ID NEM-ID is your digital signature and the key to digital Denmark. Obtain NEM-ID if you have a Danish CPR-number and valid ID. NEM-ID is the same log-in everywhere. When ordering NEM-ID the code card is automatically sent to you. For more information and ordering NEM-ID: www.nemid.nu/dk-en 6
E-BOKS E-boks is a secure electronic mailbox. Choose which mails you want to receive in e-boks. Alert by e-mail when you have received new documents. Payslips for all employed by the Danish state are available in e-boks. For more information and ordering e-boks: www.e-boks.dk 7
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COLLECTIVE AGREEMENTS Collective agreements (agreements between the various organisations and the Ministry of Finance). Agreement between the Ministry of Finance and the Confederation of Professional Associations. Contain the conditions for employment, i.e. rules on salary, pension, working hours, notice of dismissal, holiday, sickness, maternity/paternity leave etc. Normally collective agreements are entered into for a period of 2-3 years. Labour market legislation supplements the collective agreements. 9
EXAMPLES OF LABOUR MARKET LEGISLATION Holiday Act (e.g. right to holiday). Salaried Employees Act (e.g. notice of dismissal). Fixed Term Employment Act (e.g. renewal of multiple consecutive fixed-term posts held by employees involved in teaching and research activity may not take place more than twice). Working Environment Act, Equal Pay Act, Equal Treatment Act. Maternity/Paternity Leave Act (right to maternity/paternity leave). 10
JOB STRUCTURE FOR ACADEMIC STAFF AT UNIVERSITIES Positions below the level of assistant professor (PhD Fellow, Research Assistant, Assistant Lecturer, Part-time Lecturer). Positions at the level of assistant professor (Assistant Professor, Researcher, PostDoc). Positions at the level of associate professor (Associate Professor, Senior Researcher). Positions at the level of professor (Professor, Professor with Special Responsibilites). Special positions. 11
WORKING HOURS 37 hours a week full time position. Employeés such as researchers who themselves plan their work or whose working time cannot be checked are not entitled to overtime pay. Normally half an hour paid lunch break is included in the working hours. 1/1 means that you are working full time (37 hours a week). 1850/3700 means that you are working part time (18.5 hours a week).
PAY AND PENSION - PAY NEW PAY SYSTEM. Basic pay rate or basic pay rate interval which is centrally agreed together with a superstructure in the form of an allowance component which is agreed locally. Typically no or only a very small number of automatic seniority-related pay increases. Decentralized individual pay development. 13
PAY AND PENSION - PAY The structure of NEW PAY: Basic pay (salary grade 4 to 8 professors salary grades 37/38). Job structure allowances (centrally agreed). Qualifications-related allowances (locally agreed). Functions-related allowances (locally agreed). One-off payments (locally agreed). 14
PAY AND PENSION - PAY Job structure allowances (linked to the job structure position) i.e. post doc allowance, associate professor s allowance. Qualifications-related allowances - are used to reward the employee on the basis of his/her professional and personal qualifications, the quality of the performance of the task, the balance in relation to corresponding positions elsewhere in the labour market or for the purpose of recruitment and retention. Functions-related allowances - are used to reward the employee who is in charge of special functions in his/her position. It is linked to particular task which the employee performs. One-off payments - will typically be relevant if we are talking remuneration following a particular effort.
PAY AND PENSION - PENSION Compulsory labour market pension scheme under the collective agreements. Pension funds or insurance companies. Financed by pension payments made by the employer and the employee. For PhD Fellows17.1 per cent of 85 per cent of salary and pensionable allowances. For PostDocs and Professors 17.1 per cent of salary and pensionable allowances. Fixed pension funds related to type of master degree. 16
PAY AND PENSION - PENSION The labour market pension schemes typically have the following components: Retirement pension. Disability pension (working capacity reduced by 2/3 or more). Children s pension. Spouse s or cohabitant s pension. Spouse s or cohabitant s pension typically between 40 and 60 per cent of the retirement pension. Children s pension normally 10 per cent of this (20 per cent for orphans). 17
PAY AND PENSION PENSION The pension contributions are normally tied up till the age of 60. If foreign citizen, pay-out is possible, but government charge (tax) of 60 per cent and administration fee to the pension fund. Written notification to the pension fund with details of Danish bank account and documentation that the employee is a citizen of a foreign country. If fixed-term employment up to 5 years, recruited abroad and employed according to the job structure, it is possible to have the pension contributions paid out as part of the salary. 18
PENSION PAID OUT AS SALARY New international employees and existing international employees can opt to have the pension contribution paid out as salary if they: Are employed as academic staff member or salaried PhD fellow Do not hold Danish citizenship Are registered with a foreign address at the time of application Are employed in a fixed-term position for a maximum period of five years, including renewals If the new employee wants to have the pension contribution paid out as salary, the employee will be covered by a group life insurance instead. The group life insurance premium to be paid currently amounts to DKK 108.35 per month. The premium payment will be deducted from the salary. 19
PENSION PAID OUT AS SALARY Existing employees can also opt to have the pension contribution paid out as salary for the remaining part of their employment; however, for a maximum of five years. A decision to have the pension contribution paid out as salary will come into effect as of the next possible salary payment. Existing employees choosing to have the pension contribution paid out as salary do not have the option of having contributions already paid towards the pension scheme refunded. 20
PAY AND PENSION EXAMPLE PHD FELLOW Salary grade 4 present level (1 April 2012) 24,080.00 DKK PhD Fellow s allowance (non-pensionable) 1,257.86 DKK Pension contribution 17.1 per cent of 85 per cent of the salary 3,500.03 DKK Total salary including pension contribution 28,837.89 DKK 21
PAY AND PENSION EXAMPLE POSTDOC/ASSISTANT PROFESSOR Salary grade 8 present level (1 April 2012) 29,341.92 DKK Assistant Professor s/postdoc s allowance (pensionable) 4,161.91 DKK Pension contribution 17.1 per cent 5,729.15 DKK Total salary including pension contribution 39,232.98 DKK 22
PAY AND PENSION EXAMPLE PROFESSOR Salary grade 37 present level (1 April 2012) 43,990.75 DKK Pension contribution 17.1 per cent 7,522.42 DKK Total salary including pension contribution 51,513.17 DKK 23
REGULATION OF SALARY Once every 1 April and/or 1 October there will be a percentage regulation of your salary. These regulations are decided by the Ministry of Finance in conncetion with the negotiations in relation to the collective agreements. There have been no regulations since 1 April 2012. Next regulation is expected 1 April 2014. 24
INCOME TAXATION Ordinary income taxation on salary and allowances (may vary, but up to 50 per cent on average). 26 per cent tax scheme for key employees and researchers recruited abroad (minimum level of assistant professor) for a period of maximum 60 month. The 60 months may be distributed over several periods. Labour market contribution is paid and it is not possible to have any deductions. 25
HOLIDAY 5 weeks ordinary holiday (with pay if employed in the full calender year prior to the holiday year). Pay = salary + a special holiday allowance that is calculated as 1½ per cent of the taxable income in the previous calender year. The special holiday allowance is paid with the salary in April every year. After consultations with the employee the employer decides when the ordinary holiday is to be taken. The employer must provide the employee with 3 consecutive weeks of holiday in the period 1 May 30 September. 26
HOLIDAY 1 week s special holiday (if employed in the full calender year prior to the holiday year). Can be converted into cash payment and the taking is subject to agreement, but the employer may decide that the days must be taken (notice). Holiday year (1 May 30 April) when the holiday is taken. Calender year (1 January 31 December) when the holiday is earned. All holidays not taken but earned will be paid to the foreign employee when leaving Denmark.
HOLIDAY Normally the employer and the employee reach agreement as to the time of taking holiday, but if not the employer can with a notice of 3 months order the employee to take summerholidays in a specific period between 1 May and 30 September. For the rest of the holiday the notice from the employer is 1 month. Subject to agreement the employee can defer one week of holiday to the following holiday year. Holidays not taken or deferred will be lost. 28
HOLIDAY EARNING AND TAKING 1 Employment period 01-09-2013 until 31-08-2014 Calender year: 01-01-2013 01-09-2013 31-12-2013 Earning 2.08 ordinary holidays and 0.42 special holidays per month. Holiday year: 01-05-2014 31-08-2014 30-04-2015 16.68 ordinary holidays without salary and 8.32 holidays with salary. 3.32 special holidays without salary and 1.68 special holidays with salary. 31-08-2014: Holidays earned in the period 01-01-2014 until 31-08-2014 will be paid when leaving Denmark. 29
HOLIDAY EARNING AND TAKING 2 Employment period 01-09-2013 until 31-08-2015 Calender year: 01-01-2013 01-09-2013 31-12-2013 Earning 2.08 ordinary holidays and 0.42 special holidays per month. Holiday year: 01-05-2014 30-04-2015 16.68 ordinary holidays without salary and 8.32 holidays with salary. 3.32 special holidays without salary and 1.68 special holidays with salary. 30
HOLIDAY EARNING AND TAKING 2 Calender year: 01-01-2014 31-12-2014 Holiday year: 01-05-2015 31-08-2015 30-04-2016 25 ordinary holidays with salary and 5 special holidays with salary. Calender year: 01-01-2015 31-08-2015 31-12-2015 31-08-2015: Holidays earned in the period 01-01-2015 until 31-08-2015 will be paid when leaving Denmark. 31
ATP A life-long supplementary pension. Amount of 79.20 DKK a month. Can be paid to you at the time of retirement as a montly payment or as a lump sum (lump sum if less than 2,500 DKK). A 40 per cent tax will be deducted from the lump sum. A 55 per cent tax will be deducted from the monthly payment. At death an amount of up to 50,000 DKK will be paid to: - spouse. - common law spouse (special rules apply). - children under the age of 18 or 21. 32
ATP Retirement age in Denmark (right to state pension): 31 December 1958 or before 65 years 1 January 1959 30 June 1959 65½ years 1 July 1959 31 December 1959 66 years 1 January 1960 30 June 1960 66½ years 1 July 1960 31 December 1962 67 years 1 January 1963 or later 67 years ++* *Depending on whether or not the average retirement age for Denmark increases further. For more information see ww.atp.dk 33
AM bidrag and A-skat AM bidrag = Labour market contributions in fact it is a special tax of 8 per cent of your salary not including ATP. A-skat = A-tax (withholding tax). A tax which is held back by the employer and paid to the tax office (SKAT). The percentage may vary depending on your place of residence, your tax deductions and your gross income. 34
MATERNITY/PATERNITY LEAVE/SICKNESS Mother: 6 weeks before expected childbirth and 26 weeks after childbirth with full pay. Father: 2 weeks after the childbirth and an additional 6 weeks with full pay. Additional 14 weeks for mother and father will be without pay but with maternity benefit from the municipality. Possibility of up to 32 weeks extra (between the mother and father) but without any salary/benefit at all. Childcare days: 2 childcare days per child per calender year until the child has reached the age of 7. 35
MATERNITY/PATERNITY LEAVE/SICKNESS Options: partial resumption of work during leave, deferment of leave, extention of leave (32 weeks to 40 or 46 weeks). If PhD Fellow or Assistant Professor (fixed term further-education posts), the employment period will be prolonged with the period of maternity/paternity leave taken during the employment period. Right to paid leave on the first two sickness days of a child. Sickness: Normally full pay during sickness. 36