Collective Bargaining

VR, along with the Union Alliance, a broad coalition of the largest national confederations and unions within the Confederation of Labor declared on February 9, 2024, that negotiations with the Confederation of Icelandic Employers were ineffective after weeks of deliberation.

Now, more than ever, it is important for workers to stand together because solidarity is our strongest weapon. Now it is our turn!


The collective agreements between VR and the Confederation of Icelandic Employers expired at the end of January 2024, but these were short-term agreements.

The parties negotiated a specific work plan that has been followed since the last signing. This work plan addresses the main demands of VR regarding employers. The complete list of demands can be seen below.

On this page, we will keep VR members informed about the progress of the wage negotiations and publish articles and other information related to the demands of the union.

  • Government involvement in collective wage agreements in the general labour market is inevitable, since the situation calls for major changes to the basic systems of Icelandic society. The government must take part in collective wage agreement negotiations with worker and employer associations if such negotiations are to yield the expected benefits. VR and LÍV call upon the government to abolish indexation of consumer loans, reduce worker levies and taxes and lower VAT on necessities.

    The housing market needs to be reformed, and national reconciliation on the next steps needs to be reached. VR and LÍV call for rents to be capped, for young people buying their first home to receive greater public-sector support and for a significant increase in the number of available plots of building land, with the involvement of municipalities. The supply of housing – whether for purchase or rent – is entirely out of line with demand, and few people can afford a roof over their heads.

    VR and LÍV also call upon the government to take better care of those who need more assistance by scaling back cutbacks in the social security system, abolishing the income-linked nature of benefits and subsidising psychological assistance.

  • The main purposes of collective wage agreements as regards wages is to safeguard the results secured in previous agreements for those earning the least, while ensuring equality for all workers as regards wage increases. Increasing the purchasing power of disposable income and ensuring that workers are able to enjoy a decent quality of life on their daytime wages are the foundations of VR’s and LÍV’s wage demands. The minimum wage should be sufficient for subsistence purposes, in light of the prevailing norms.

    VR and LÍV therefore call upon the government to propose measures to bolster the wage aspect of the claim, e.g. action in tax and interest matters, an increase in child benefits and the abolition of indexation of consumer loans.

  • VR and LÍV propose a number of amendments to sick-leave rights under collective wage agreements. VR and LÍV restate their demand that leave rights relating to ill children should include children and young people up to the age of 18. VR and LÍV also wish to ensure that sickness-related absence is counted either in half or full days.
    VR and LÍV believe it is important make sick-leave rights more flexible, in order better to accommodate the needs of members suffering severe health-related problems. VR and LÍV call for sick-leave rights to be extended to cover serious illness and/or the loss of close relatives, as well as funerals.

    VR and LÍV also restate their demand for all costs relating to medical consultation fees and medical certificates to be paid by the employer if a medical certificate is required by the employer. VR and LÍV also call for preventive doctor/dentist visits to fall under sick-leave rights, both for members and their children.

  • Workers demand more free time and more flexibility in taking leave. Under VR and LÍV collective wage agreements, the minimum amount of annual leave is 24 days, increasing to up to 30 days after 10 years’ service in the same company. Changes to annual leave rights in the public sector call for a review of the equivalent rights of workers in the general labour market. VR and LÍV call for all of their members to be entitled to 30 days’ annual leave per year.

    VR and LÍV also call for annual leave rights to be extended so that the workers may use their leave over a period of two years at a time. If it is not possible for a worker to use their leave within that time, unused leave will be paid to them before a new period begins.

    VR and LÍV also call for workers to receive annual leave pay during statutory maternity/paternity leave.

  • Working time in Iceland is one of longest among comparable countries, and the consequences are reflected in the rise in the number of workers seeking the services of trade union health funds in recent years.

    VR and LÍV focused on achieving a shortening of the working week under the 2019 Living Standards Agreement. The shortening secured was the first step towards a considerably shorter and family-friendly working week. The shortening was successful, and members were generally satisfied. VR and LÍV believe it is important for businesses to seize the opportunities offered by greater efficiency resulting from advances in automation and technology to further shorten workers’ working week.

    VR and LÍV call for the working week to be shortened to four days – corresponding to 32 hours per week – before the end of the period covered by the agreement, with no reduction in wages. In this connection, VR and LÍV believes it is important for Act No. 88/1971 on the 40-Hour Working Week to be reviewed in line with the current demands of worker associations for shorter working time.

  • Workers having worked for a long time for the same employer should be granted a longer notice period, regardless of age. This right should be in addition to the rights already enshrined in the collective wage agreement.

    VR and LÍV therefore call for notice periods to be set as follows:

    • four months after 10 years of employment with the same employer.
    • five months after 15 years of employment with the same employer.
    • six months after 20 years of employment with the same employer.

    Workers should, however, be able to resign with three months’ notice.

  • The COVID-19 pandemic demonstrated the importance of flexibility in the labour market and how quickly and well workers are able to respond to changing circumstances. Teleworking has become an essential part of the work environment for many people, and it is important to improve and better secure the position of workers in those situations.

    VR and LÍV call for the framework agreement on teleworking in the general labour market to be thoroughly reviewed with a view to ensuring better rights for teleworkers and acceptable working facilities, at no cost to the worker. VR and LÍV also propose the inclusion of specific provisions on teleworking in the general collective wage agreement.

    VR and LÍV also call for members to have the freedom to telework when conditions allow, for flexibility to be increased and for the consent of both parties to be ensured.

  • Democracy is the cornerstone of Icelandic society, and VR and LÍV want to give workers greater opportunity for democratic participation in their workplace. VR and LÍV call for Iceland to follow the example of many European countries and set up a system of workplace democracy where workers may elect a representative to the management board of the company for which they work. VR and LÍV propose to follow the example of other Nordic countries and give workers the right to elect a certain number of representatives to the management board, in accordance with the size of the company. VR and LÍV also believe it is important for this right to be enshrined in law.

    VR and LÍV also call for a system of democracy within pension funds, so that members can elect a representative to the management board of their fund and thus become involved in decision-making regarding the activities and operations of the fund in question. VR and LÍV call for trade unions and employers to agree that half of the members of pension fund management boards should be elected directly by the fund members during the term of the agreement, before the end of the period covered by the agreement. VR and LÍV also call for a greater weighting of representative councils / fund members in the decision-making procedures of the fund.

  • Greater demands are being made of workers as regards education and knowledge, not least owing to the “Fourth Industrial Revolution” and the wide-ranging and rapid changes in jobs that have taken place in recent years. VR and LÍV believe it is important for employers to see learning and training as part of the job and encourage employees to get the training they need to improve their skills and take an active part in changes in the labour market.

    Under current collective wage agreements, workers are entitled to spend four hours per year attending work-related studies or courses, without a reduction in wages. VR and LÍV call for workers to be entitled to spend at least one working week per year attending work-related studies or courses, without a reduction in wages.

  • The “Vocational training in trade and services” course was developed in co-operation with the social partners and has been run – in successful collaboration between life-long learning centres, businesses and upper-secondary schools – for three years. The programme is based on skills requirements for trade workers and offers participants a real skills assessment evaluating their knowledge and competences. This assessment is converted to upper-secondary school credits to replace academic courses. In addition, part of the programme takes place in practical courses in the workplace.

    VR and LÍV call for members completing the “Vocational training in trade and services” course to have these studies count towards a pay raise of at least 7% at the end of each third of their studies. VR and LÍV also call for workers who had already completed this course before recruitment to receive a higher salary equal to this increase.

    • Accrued rights
    • Members’ accrued rights should be transferred between employers in their entirety. This refers to members’ sick-leave rights and annual leave accrued in the labour market.
    • Health improvement/protection
    • Employers should further support health promotion of workers for preventive purposes, as this is to the benefit of both sides.
    • Workers have an unequivocal right for their employer to respect the boundaries between work and leisure time. The collective wage agreement should include clear rules obliging employers to respect the defined working day of workers, regardless of the form and location of the work performed.
    • Major public holidays and other specific public holidays
    • 1 May should be classified as a major public holiday.
    • Boxing Day and New Year’s Eve should be classified as a major public holiday for the entire day, rather than just from 12:00.
    • The payment of wages on specific public holidays should be confirmed in the collective wage agreement more clearly than is currently the case.
    • Workers who need to travel on behalf of the employer on specific public holidays will receive a day’s holiday at a later juncture, without a reduction in wages.
    • Wages and wage implementation
    • Monthly wages should be settled in such a way that no more than one week remains unpaid in any calendar month.
    • Minimum working time should be 4 hours both on weekdays and at weekends, and wages should never be paid for a shorter period of time, even if the period of time worked is actually shorter.
    • VR and LÍV call for employers to ensure that their pension fund contributions result in a wage increase for workers aged 70 and older or are allocated in some other way in line with the worker’s wishes, since workers of that age no longer pay pension fund premiums.
    • Commuting
    • Employers should pay the travel costs of members who live outside of the Greater Reykjavík Area in cases where public transport is not available.
    • In the special collective wage agreement between VR/LÍV and SA dealing with guest reception, costs will be based on that determined by the state travel expenses committee set up under the general collective wage agreement.
    • Shop stewards
    • The mandate of shop stewards should be extended from two years to four years.
    • Removing reduction of disability benefits due to age
    • The reduction of disability benefits due to age (cf. Article 8.6.5 of the collective wage agreement) should be removed.

    In all other respects, reference is made to the common demands of the Icelandic Confederation of Labour (ASI).