Browse through brief employment and labor law updates from around the globe. Contact a Littler attorney for more information or view our global locations.

Supreme Court Rules on the Definition of Employees Vis-à-vis Consultants According to Tax Legislation

Precedential Decision by Judiciary or Regulatory Agency

Author: Bo Enevold Uhrenfeldt, Partner – Littler | enevold

On December 8, 2022, the Supreme Court of Denmark ruled in a dispute between a Dutch company and the Danish Ministry of Taxation regarding whether 101 divers were to be classified as employees or self-employed. The dispute concerned the company’s obligation to withhold taxes in the payment the divers received during a period of work in Danish waters. The company argued that the divers should be regarded as self-employed, whereas the Ministry of Taxation argued that the divers should be regarded as employees.

The Danish Supreme Court ruled that, regardless of the wording in the employment contracts in question and industry standard practice, the divers should be regarded as employees, and thus that the employer was liable for not complying with tax legislation applicable to employees. The Supreme Court emphasized in the assessment, among other factors, the instruction and supervision performed by the company as well as the divers’ limited financial risk in relation to the client. With this ruling, the Supreme Court marks that in order to ensure compliance with tax legislation, employers must exercise caution...

Read Full Story: https://news.google.com/__i/rss/rd/articles/CBMiWmh0dHBzOi8vd3d3LmxpdHRsZXIuY...