On Thursday, 24 November 2022, VR declared their lack of success in collective bargaining negotiations with Samtök atvinnulífsins (SA). The unions referred the collective bargaining with SA to the State Conciliation and Mediation Officer on 14 November. Negotiations since then have centred on the conclusion of a short-term collective wage agreement with an emphasis on the wage cost section and the goal of bringing down inflation and lowering interest rates.
What are the next steps?
Terminating collective bargaining does not necessarily mean going on strike. It is, of course, confirmation that VR has assessed the situation to be such that continuing the negotiations would be futile. VR’s negotiation committee has been summoned to a meeting with the State Conciliation and Mediation Officer on Tuesday, 29 November, and the next steps will then become clearer.
The decision to call a strike is always voted on by the groups that the strike will include. The decision to call a vote is taken by the union’s negotiation committee. It is not foreseen that VR will go on a general strike if such measures are taken. No decision has been made on strikes at this time. If so, this will be announced separately.
This information page is under construction, and the latest developments in collective bargaining will be published here.
A collective wage agreement is an agreement made between a workers’ association (union) and an employer’s association. Collective wage agreements are the minimum rights of employees in the relevant profession. Once a collective wage agreement has been approved, it cannot be altered or deviated from, and both parties must abide by this agreement. The validity term of collective wage agreements can vary and is from a few months to several years, but when a collective wage agreement is signed, the validity term of the agreement must be clear.
In a collective wage agreement, important issues concerning the employment relationship are agreed upon, such as wages, working hours, leave, sick pay, notice period, insurance, contributions to pension funds and vocational training funds, to name a few. The labour market is one of the pillars of the economic system in Iceland, and the collective wage agreements made in the labour market are a key element in the welfare system, as well as serving as the rules of the game in the labour market.Parties in the labour market, i.e. workers and trade unions, employers and employers’ associations, are bound by the agreement that is in force at any given time, and it is said that in the meantime, there is a duty of peace in the labour market. During that time, the parties in the labour market are not allowed to call for strikes or lockouts. Before the agreement expires, both parties work on preparations for the next agreement.
No, after a wage dispute has been referred to the State Conciliation and Mediation Officer, it is not permitted to resign from the union, cf. Article 6 of VR’s bylaws.
If you are continuing to work for the same employer in the same job or for a new employer in a job that is covered by VR and is in VR’s membership area, you cannot resign from the union after collective bargaining has been referred to the State Conciliation and Mediation Officer. VR/LÍV’s collective bargaining with SA was referred to the State Conciliation and Mediation Officer on 14 November, and therefore it is not possible to resign from the union until agreements have been reached.
This applies to those members of VR who have jobs covered by VR’s collective wage agreements and are in its membership area. When agreements have been reached, you can resign from the union* (Paragraph 2, Article 74 of the Icelandic Constitution), but you still have the obligation to pay all premiums to VR (Article 6 of Act No. 55/1980 and Article 10.1 in VR’s collective wage agreement).
- So you are not participating in the social activities of the union but enjoy the protection of VR’s current collective wage agreement, as well as the right to VR’s funds, according to their current rules, and to the services of the union's Employment Terms Department.
- Cf. Paragraph 2, Article 74 of the Icelandic Constitution: no one may be obliged to be a member of any association.
- Article 6 of Act No. 55/1908 on Working Terms and Pension Rights Insurance states that “The employer is under obligation to withhold from the employee’s wages their membership fee for the relevant trade union according to the rules thereon stated in the collective agreements.” You are therefore obliged to pay the premiums if you are working in VR’s membership area / field of operation. Article 10.1 in VR’s collective wage agreement further states that “Employers undertake to allow commercial workers who are members of VR or the appropriate constituent union of LÍV to enjoy priority access to employment in all general commercial work according to this Agreement.”
It should be noted that if a person defaults on their union fees but is still employed in VR’s membership area and in the union’s field of operation, and VR decides to go on strike, that person is nevertheless bound to cease working. This also applies if the person pays fees to another union, but the job is in VR’s membership area and its field of operation. As this person was not paying premiums to VR, they would not receive payment from VR’s strike fund. As always, we hope that there will be no need to strike in this round of negotiations.
Exceptions are in the following cases:
You remain with the same employer but are transferring to a new job with them that is covered by a different union than VR:
If you are changing your workplace within the same company where you will be working in a new job that belongs to a different union than VR, you contact the employer and inform them of the change so that membership fees are paid to the union to which the new job belongs.
You are transferring to a new job with a new employer that is covered by a different union than VR:
If you are going to work for a new employer, payments will automatically stop coming to us when the wage payments from your current employer end. Then you need to contact your new employer and inform them about which union your membership fees should be paid from the new job.
You remain with the same employer and in the same or similar job, but you move to a new workplace that is outside VR’s membership area:
In this case, you must contact contact your employer and ask them to transfer membership fees to the workers’ union that has an agreement in the new membership area where your workplace is located.
The only recourse that unions have to advance their demands (their goals in a labour dispute) to obtain judicial improvements is to call a work stoppage/strike. The Act on Trade Unions and Labor Disputes applies to strikes and their implementation.
At the beginning of the collective bargaining, a negotiation plan is drawn up between the parties to the agreement, and the time limit for when a claim must be submitted and how long the parties intend to complete the negotiations are set out. After that time, the parties can either together, or separately, refer the dispute to a mediator who will then take over the negotiations. In order to be able to call a strike, two conditions must be met: on the one hand, that the dispute has been referred to a mediator, and on the other hand, that the strike call has been approved in a general vote among the members of the union.
Voting on a strike
Voting on a strike must be anonymous and include all those who are to be affected by the strike. In the case of electronic voting, as is customary at VR, there is no minimum participation requirement, but the majority of those who vote must be in favour of a strike. A strike may be limited to a specific group of members, and then only those affected by the strike may participate in the vote, and the majority of them must approve the strike.
The notice of a strike must be clear, and it must state when the strike is to begin and notify the target of the strike no later than seven days in advance. A strike is intended to force the advancement of the demands that have been put forward, and it is not possible to impose a strike to e.g. force the government to do something that could be considered a judicial improvement for members. If there is a dispute about strikes, e.g. regarding notice or implementation, the dispute shall be referred to the Labour Court.
News on the progress of collective bargaining negotiations
News item from 25 November 2022
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.
News item from 14 November 2022
The wage agreement, which was signed in 2019, expired at the end of last month. VR, LÍV - The Commercial Federation of Iceland and The Federation of General and Special workers in Iceland (SGS) have been closely involved in negotiations with The Confederation of Icelandic Enterprise (SA) for the last few weeks and tried to reach a new agreement. There have been a lot of meetings, but now it appears that there is too much separating the parties. An agreement is not in sight and there are no grounds for continuing the talks at the moment.
News item from 28 October 2022
As we recently reported, the largest national associations of workers in the labour market, Landssamband Íslenzkra verzlunarmanna (LÍV) and Starfsgreinasamband Íslands (SGS), decided to join forces in negotiations with Samtök atvinnulífsins (SA) on a new collective wage agreement.
News item from 26 October 2022
The largest national associations of workers in the labour market, Landssamband Íslenzkra verzlunarmanna (LÍV) and Starfsgreinasamband Íslands (SGS), decided to join forces in negotiations with Samtök atvinnulífsins (SA) on a new collective wage agreement. The collaboration covers close to 90,000 individuals working in the public labour market within twenty unions.
News item from 24 August 2022
VR has introduced their and LÍV’s demands for the next wage agreement to the Confederation of Icelandic Employers (SA), but the wage agreement between VR / LÍV and SA expires on 1. November 2022.