In the Danish Supreme Court’s judgement printed in U.2022.2855H, it was established that a liability insurance company (SKULD) could be reimbursed a Philippine POEA-compensation by set-off against the loss of earning capacity compensation under the Danish Workers’ Compensation Act because the compensation was “of the same nature” as the loss of earning capacity compensation and that the work injury insurance company (UFDS) could therefore pay with releasing effect to the liability insurance company.
Gorrissen Federspiel conducted the Danish Supreme Court case on behalf of UFDS and SKULD with Danske Rederier as intervener in support of UFDS and SKULD.
With Act no. 1541 of 12 December 2023, which entered into force on 1 July 2024, section 29(2) of the Workers’ Compensation Act was amended so that the right of set-off only applies to “compensation, damages etc. under the Danish Liability and Compensation Act” for payments made on 1 July 2024 and onwards.
The Danish Labour Market Insurance and the Danish Working Environment Authority have stated that the new section 29 does not allow set-off for compensation, damages, etc. that are not covered by the Danish Liability and Compensation Act.
The consequence of this interpretation is that Danish seafarers on Danish-flagged ships cannot receive compensation of the same type for the same period under both the Danish Workers’ Compensation Act and the Danish Liability and Compensation Act for the same work-related injury, but foreign seafarers on Danish-flagged ships can receive compensation of the same type for the same period under both the Danish Workers’ Compensation Act and foreign rules, including Philippine POEA-compensation, for the same work-related injury.
This deviates from the legal position from the Danish Supreme Court’s judgement, and it is contrary to the overall purpose of the provision, as stated in the Act’s comments: to avoid double compensation.
Should there be any questions regarding this amendment, please reach out to our team.