This legislative proposal implements the agreement on the payment of the remaining two weeks of frozen holiday funds, the export package and the reserve for the extension of supplementary packages.
The agreement between the Government (S), the Liberal Party (V), the Social Liberal Party (RV), the Socialist People’s Party (SF), the Red-Green Alliance (Ø), the Conservative People’s Party (K) and the Alternative (Å) was concluded on the second of December 2020. The agreement was to implement initiatives that help to stimulate private consumption, support Danish export and protect Danish employees, jobs and companies during a period when our society continues to be subject to restrictions on economic activity as a result of covid-19.
The Act is intended to allow employees to receive the remaining holiday funds from the end of March 2021. Payment of the remaining holiday allowances will be based on the actual receivables of the employees on the basis of a consolidated statement of citizens’ receivables.
In order to avoid pressing the liquidity of companies in connection with the disbursement, the State will finance the early disbursement of Vacation funds by providing a loan to the Fund in the intermediate term, as was the case under the current rules on the early disbursement of Vacation Funds. This means that employers’ payments to the fund will be independent of whether employees have been paid early on holiday.
The development of the technical solution for the early payment of receivables in the spring of 2021 means that some other tasks with receivables must be postponed. This would, for example, lead to a postponement of the fund’s collection of employers to pay to the fund, the transfer by the fund of claims to the Employees’ Guarantee Fund in the event of the employer’s bankruptcy or relocation and the recovery of unjustified payments by the Fund in autumn 2020.
The bill is in accordance with principle 2 that communication must take place digitally, as the bill expects the citizen’s application for early payment of holiday funds to be digital, but with the possibility of applying for a form sent to the fund.
The bill supports principle 3 on automated workflows associated with decisions. Calculation of the early payment will normally be done automatically on the basis of the employer’s reports, the fund’s information on previously paid holiday funds, as well as tax information obtained from the Danish Tax Agency. The fund will thus carry out automated processing of applications, with the possibility of manual processing on the basis of specified criteria, which are expected to be laid down by notice.
The legislative proposal also complies with principle 7 on the prevention of cheating and errors. Since detailed rules are laid down in the order on fund control for early payment of holiday funds, both in connection with the processing of the citizen’s application and when payment has been completed. In particular, rules on the manual processing of applications may be laid down for persons in whom the alert of Vacation Funds appears unusual, or possibly unjustified, so that this can be taken into account when calculating the payment.
The legislation has financial impacts for the public sector in the form of administrative additional costs in the Labour Market Supplementary Pension, as a result of early payment of remaining receivables. The bill also has administrative impacts for the tax administration as a result of guidance, case handling and system orientations.
The amending of the law on the management and administration of receivables and various other laws is an example of how the principles behind digital-ready legislation can be incorporated into legislation, including digital communication, automatic processing of applications and prevention of cheating and errors.
