News - 25.11.2022

Wage negotiations have been unsuccessful

VR declared last night, Thursday 24. November 2022, that the wage negotiations with the Confederation of Icelandic Employers (SA) have been unsuccessful. The unions referred the wage negotiations with SA to the the State Conciliation and Mediation Officer (SCMO) on 14. November 2022. Negotiations since then have focused on making a short-term collective agreement with an emphasis on the salary element and the goal of bringing down inflation and lowering interest rates.

In the last few days negotiations have moved in the right direction, but it is now clear that the prerequisites for continued dialogue are no longer present. The decision of the Central Bank of Iceland to raise the key interest rate to 6% upset the negotiations, and SA's offers for wage increases so far do not in any way cover the increases in prices and interest rates that have hit workers in this country. Further increases are now foreseeable.

VR's negotiation committee could not sense any willingness on the part of SA's negotiation committee to raise its offer from what was offered when the dispute was referred to the SCMO, and therefore there is no apparent purpose in continuing the negotiations as they are.

A statement about the ineffectiveness of negotiations means that VR will now inform the union members about this decision and assess the next steps. According to the law, the SCMO must make an attempt to reach a settlement if the other party so requests or if the SCMO deems it appropriate. However, the SCMO must always seek a agreement within 14 days of the last negotiation attempt.