ICELANDIC LABOUR LAW A SUMMARY OF BASIC RIGHTS AND OBLIGATIONS ON THE PRIVATE LABOUR MARKET ICELANDIC CONFEDERATION OF LABOUR (ASI) Fifth edition December 2010 © Icelandic Confederation of Labour (ASI). This copyright protected material may be reproduced free of charge, subject to the material being reproduced accurately. Where this text is being copied to others, the source of the material must be identified and the copyright status acknowledged. Foreword On behalf of the legal department of the Icelandic Confederation of Labour (ASI) we are pleased to present this summary of labour law and trade union rights in Iceland. In this booklet the reader will find information about trade unions and collective bargaining, employment contracts, wages and working time, holiday allowance, payments in case of accidents and sickness, health and safety in the workplace, maternity and paternal leave, information and consultation of workers, access of foreign workers into the labour market and other related issues. Our focus is on the general or private labour market. The public labour market is governed by a different set of rules. Collective bargaining between the social partners has a long tradition in all sectors of the labour market. Wages and other terms of employment are set by the social partners and this method of regulating the labour market is strengthened by a specific provision of law which makes their collective agreements generally applicable and binding upon all workers and employers operating within the boundary of the applicable agreement, whether general workers, tradesmen, office workers etc. Workers rights are also protected in various pieces of legislation which deal with particular aspects of the employment relationship and the social rights of workers. We hope this summary will serve foreign workers and employers alike, as a good introduction to labour law in Iceland. October 2009 Magnús M. Norðdahl hrl. Chief Lawyer – Icelandic Confederation of Labour Table of contents ICELANDIC LABOUR LAW.....................................................................1 ON THE PRIVATE LABOUR MARKET...........................................1 Introduction.............................................................................................7 1.1 Introduction...........................................................................................9 1.2 Membership of Trade Unions ...................................................................9 1.3 Representation at the workplace .............................................................9 1.4 Priority clauses ....................................................................................10 1.5 Strikes................................................................................................10 1.6 Political rights of workers.......................................................................11 1.7 Union funds.........................................................................................11 2. Collective bargaining..........................................................................11 2.1 Introduction.........................................................................................11 2.2 Content of collective agreements............................................................11 2.3 Occupational and geographical coverage.................................................12 2.5 Types of agreements.............................................................................12 2.5.1 General collective agreements ............................................................................12 2.5.2 Special agreements...........................................................................................12 2.5.4 Workplace agreements, supplementing collective agreements. ...............................12 2.6 Period of validity...................................................................................13 2.7 Confidential ballots ..............................................................................13 2.8 Industrial Peace ...................................................................................13 ...............................................................................................................13 3. Access to the labour market ..............................................................13 3.1 Introduction.........................................................................................13 3.2 Non-discrimination ...............................................................................13 3.3 Age limits............................................................................................14 3.4 Professional qualifications......................................................................14 3.5 Foreign workers...................................................................................14 4. Contract of employment.....................................................................14 4.1 Introduction.........................................................................................14 4.2 Incorporation of collective rights.............................................................14 4.3 Written statement or contract of employment..........................................14 4.4 Changes in terms of employment...........................................................15 4.5 Termination of contract.........................................................................15 5. Wages and working time....................................................................16 5.1 Introduction ........................................................................................16 5.2 Working time.......................................................................................16 5.2 Day time and over time work.................................................................16 5.3 Major holidays......................................................................................17 5.4 Transfer of public holidays.....................................................................17 5.5 Christmas and Holiday bonus payment....................................................17 5.6 Shift work ...........................................................................................17 6. Daily and weekly rest and maximum weekly working time ...............................................................................................................17 6.1 Introduction.........................................................................................17 6.2 Maximum weekly working time...............................................................18 6.3 Daily rest.............................................................................................18 6.4 Weekly day off.....................................................................................18 6.5 Night workers......................................................................................18 7. Meal and Coffee breaks ......................................................................19 7.1 Introduction ........................................................................................19 7.2 Meal breaks.........................................................................................19 7.3 Coffee breaks.......................................................................................19 7.4 Work during lunch and coffee breaks......................................................19 8. Pay statement.....................................................................................19 8.1 Introduction.........................................................................................19 8.2 Particulars of a written pay statement.....................................................19 8.3. Payment ............................................................................................20 9. Personal income tax ..........................................................................20 9.1 Introduction.........................................................................................20 9.2 Personal tax credit ...............................................................................20 9.3 Social security contributions...................................................................21 10. Holidays and holiday allowance .......................................................21 10.1 Introduction ......................................................................................21 10.2 Number of holidays.............................................................................21 10.3 Holiday allowance...............................................................................21 10.4 Holiday period....................................................................................22 10.5 Holiday outside the holiday period........................................................22 10.6 Worker falls sick before or during holiday ..............................................22 10.7 Employment terminated .....................................................................23 11. Absence from work due to sickness .................................................23 11.1 Introduction.......................................................................................23 11.2 Statutory rights..................................................................................23 11.3 Collective rights..................................................................................23