Dansk Industri and CO-industri enter into a three-year collective agreement

The employer organization Dansk Industri (DI) and the trade union CO-industri have just concluded a new three-year collective agreement covering the industrial sector.

The agreement, considered a breakthrough settlement in the private labor market’s minimum wage sector, is valid until March 1, 2028. According to DI’s chief negotiator, Lars Sandahl Sørensen, the agreement is proof of the strength of the Danish model as a cornerstone of Danish society.

Significance and background of the agreement

After extensive negotiations since January 6 at Industriens Hus, DI’s CEO Lars Sandahl Sørensen and Deputy CEO Kim Graugaard, together with CO-industri Chairman Claus Jensen and Deputy Chairman Mads Andersen, presented the details of the new agreement.

Lars Sandahl Sørensen emphasizes that the agreement is particularly important in a world marked by uncertainty:

“When the world is in upheaval, it is more important than ever to stand together and show responsibility. This applies to Europe. It applies to Denmark. And it certainly applies to the Danish labor market. Today, we demonstrate that we can provide clear frameworks for the Danish labor market for the next three years.”

Scope and key elements of the agreement

The new collective agreement covers two major agreements: the Industrial Agreement, which includes skilled and unskilled workers, and the Industrial Salaried Employees’ Agreement for technical and administrative employees. In total, the agreement covers approximately 6,000 companies and 230,000 employees.

The negotiating parties have prioritized both real wage growth for employees and competitiveness for employers. According to Lars Sandahl Sørensen, the agreement provides a balanced foundation for continued positive business and wage development in Denmark.

New initiatives in the agreement

The agreement introduces several improvements for employees, including:

• Parental rights: Parents receive two additional weeks of paid parental leave. In addition, close relatives and social parents are entitled to leave.
• Pension and flexible wage account: Pension contributions will increase by one percent in 2025, and the flexible wage account will increase by one percent in both 2026 and 2027.
• Wages and overtime: Overtime pay will increase by three percent.
• Family-friendly measures: Employees will be entitled to a third sick day for their child, grandparents can take two grandchild care days, and there will be leave to accompany close relatives in emergencies or for hospital check-ups.
• Worktime flexibility: Employees and companies will have greater flexibility in managing overtime, allowing it to be either paid out or taken as time off.
• Work environment: As a member benefit, compensation has been introduced for occupational health and safety representatives.

Additionally, the agreement includes administrative simplifications to reduce bureaucracy and burdens on businesses.

Danish economy and labor market development

The agreement is based on a solid Danish economy, where GDP in Q3 was 3.9 percent higher than the previous year, primarily driven by growth in the industrial sector—particularly in pharmaceuticals.

Wage growth is around five percent annually, and real wages are back at 2021 levels. Inflation in Denmark is currently at 1.6 percent, lower than in the eurozone and the USA. The Danish economy is expected to grow by 2.4 percent in 2025 and 1.6 percent in 2026.

Although unemployment has risen by 3,400 people in the past year, it remains at a low level of three percent.

The agreement ensures stability and competitiveness

With this three-year collective agreement, DI and CO-industri are creating predictable and stable conditions for the Danish labor market. Lars Sandahl Sørensen emphasizes that the agreement provides security and balance for both companies and employees:

“All in all, this is a balanced and responsible agreement that improves conditions for both employees and employers. It shows that Danes can rely on the Danish model.”