Pension funds & unions
All workers must pay into a pension fund. The purpose of pension funds is to pay their members a retirement pension and guarantee them and their families against loss of income as a result of loss of ability to work or of death.
Full entitlement to old-age-pension requires a total residence of at least 40 years between the ages 16 to 67 years. If your residence in Iceland is less than 40 years, your entitlement is calculated proportionally based on the residence period. More information about this here.
Why do I need to pay into a pension fund?
Trade unions and work place support
The role of unions is first and foremost to negotiate, on behalf of their members, wages and other employment terms in collective wage agreements and to protect their interests in the labour market.
In unions, wage earners join hands, on the basis of a common occupational sector and/or education, in protecting their interests.
The trade union movement represents workers and guarantees their rights. It is not mandatory to be a member of a trade union, but workers nevertheless make membership payments to a union. In order to be registered as a trade union member and enjoy the rights associated with membership, you need to apply for admission in writing.
Efling and VR are big unions and there are many more all around the country. Then there are workers associations like ASÍ, BSRB, BHM, KÍ (and more) that work towards protecting the rights of their members.
The Icelandic Confederation of Labour (ASÍ)
The role of ASÍ is to promote the interests of its constituent federations, trade unions and workers by providing leadership through co-ordination of policies in the fields of employment, social, education, environment and labour market issues.
It´s built up of 46 trade unions of general workers, office and retail workers, seamen, construction and industrial workers, electrical workers and various other professions in the private sector and part of the public sector.