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Bank account requirement keeps out Grundfos’s foreign employees

New legislation requiring that salaries be paid into Danish bank accounts is such an administrative burden that Grundfos is close to giving up on bringing its foreign employees to Denmark. The Confederation of Danish Industry is pushing for change via the Danish Business Forum for Better Regulation. 
It is essentially no longer possible for Grundfos to hold meetings in Denmark with those of its employees who are employed in the global pump corporation’s companies located in countries outside the EU. Photo: Colourbox

Publiceret: 25.10.2017
Af Karen Witt Olsen mail

For the past four months, Grundfos in Bjerringbro has faced serious challenges in getting many of its internationally employed employees to Denmark. 
This is due to a tightening of the Danish Aliens Act, passed by a majority in the Danish parliament last June.

“The tightening means that employees who are citizens in non-EU/EEA countries such as Singapore, Serbia or the United States and who regularly work at the headquarters must have a Danish bank account,” explains May Øhle Storri, Head of Grundfos’s Global Mobility Service. 

She is in charge when the global corporation sends employees around amongst the 45 countries in which its 80 companies are located.
“We have Grundfos employees who are employed abroad but have projects that are anchored in Denmark - or whose manager is based here. These employees need to visit the country several times throughout the year. This is no longer possible unless they have a Danish bank account to which we can pay salary for Danish workdays,” says Maj Øhle Storri.

See also: Copenhagen get spouses of foreign nationals to work

Completely out of proportion

To make matters worse, it is difficult for foreign employees to open a bank account.

The new requirements also apply to the so-called Pay Limit track under the Fast-Track scheme, which was originally meant to ensure less administrative hassle for Denmark’s global companies when dealing with foreign employees.

“In practice, not all banks are willing to open a Danish account for our foreign employees. Banks are affected by changes to the Danish Anti-Money Laundering Act, the result of which is that we don’t have a Danish bank account into which we can pay salary for Danish workdays,” says Maj Øhle Storri.
She explains that the administrative burdens for Grundfos in relation to trying to open a Danish bank account for a foreign employee - and, in particular, handling payment of salary into it - are enormous.
“In many cases, it is a matter of salary for 20 workdays a year at most. But the resources we spend on it are completely out of proportion,” says the leader of Grundfos’s Global Mobility Service.
Both she and the global pump corporation are frustrated.
“At the moment, it is becoming more and more difficult to run a global business out of Denmark. That is frustrating,” says Maj Øhle Storri. 

See also: Read more and get help with tax rules for foreign employees in Denmark here

The alternative is to relocate

Grundfos is just one of many major Danish companies that operate at a global level - and that face difficulties as a result of the requirement for salary to be paid into a Danish bank account.

The Confederation of Danish Industry has therefore been the driving force behind a proposal sent to the government today by the Business Forum for Better Regulation.

“We propose that the government make an exception, so that the requirement of a Danish bank account does not apply to the Pay Limit track under the Fast-Track scheme, for example if Grundfos’s employees are in Denmark for a total maximum of three months per year,” says Linda Duncan Wendelboe, Head of DI Global Talent.

The alternative, she says, is not good.

“Ultimately, we risk seeing our global Danish companies relocate departments and staff functions to a country where it is possible for them to actually meet with their own employees. That would be highly unfortunate,” says Linda Duncan Wendelboe.

The proposal to eliminate the requirement of a Danish bank account from the Pay Limit track in the Fast-Track scheme is part of a longer list of in all 17 proposals aimed at making it easier for companies to recruit and administer foreign employees.

Business Forum for Better Regulation
Established in 2012 as an advisory body for the government.
Its aim is to make it easier to run a business in Denmark by reducing administrative burdens and other hassles.
Currently has special focus on the food industry.

DI can help
If you are experiencing more burdens and hassles than usual, contact the Confederation of Danish Industry’s representative in the Business Forum for Better Regulation:
Dorte Gram Nybroe, Head of SME and Entrepreneurship:
dgnydi.dk or 33 77 37 69

The resources we spend on it are completely out of proportion.
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PUBLISHED: 10/25/2017 LAST MODIFIED: 10/25/2017