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Lønmodtagernes Garantifond (LG)

Lønmodtagernes Garantifond (LG)


If your company is going through a restructuring, you can apply for a loan from LG to pay salary, etc. to your employees. This is a loan that will need to be repaid.

Who is covered?

LG can cover those employees who are regarded as wage earners.

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What can you get covered?

LG covers the employees that are still working during the restructuring and which lack salaries, etc. For these employees, you can get covered:

  • up to three months’ salary, etc. that is due during the company’s restructuring and

  • up to a month’s salary, etc. that is due before the company finishes its restructuring.

Note that the three months do not have to be consecutive.

You can apply for a loan for net salaries for every payroll or just some payrolls, and you can apply for a loan for all employees or just some of them.

You can at most be paid out DKK 80,000 net for each employee for salary that is due for payment during restructuring and at most DKK 26,667 net for salary that is due before restructuring.

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How to apply for loans

You can apply for a loan when the probate court has received your request for restructuring and a restructuring agent has been appointed. It is you as the employer that can, together with the restructuring agent, apply for a loan from LG via an application form.

Please note that you can only apply for loans while you are undergoing a restructuring.

How is the loan paid?

LG can only pay as long as the company is in the midst of a restructuring process.

LG pays to a so-called zero offset (protected from creditors) account which has been created in connection with the restructuring. As far as possible, the money is paid three working days after the application was received. Please note that it may then take another additional three working days before the amount is usable from the company’s account. The money will at the earliest be usable the day before the designated date for salary payments.

Please note that if the application lacks certain information or documentation, it may take longer to process it.

Once the loan is paid out, you must pay the salary to your employees yourselves.

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How is the loan repaid

LG’s payments during a restructuring process are a loan to you as an employer. The loan must be paid back with interest to LG.

Before the end of the restructuring process, you must have entered into an agreement with LG about the repayment terms. Both the restructuring agent and the company are obliged to ensure this happens when applying.

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Terminated and released from duties

If you as an employer has terminated and released employees from their duties before or during the restructuring, LG can pay the missing salary, etc. for your employees. LG covers the employees who are regarded as wage earners.

Go to 'Payment in the event of bankruptcy, cessation of operations and reconstruction'

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Legislation etc.

Here you can find information on legislation, how to complain and read about how we process personal data.

Go to legislation ect.

Opdateret 15.08.2021