The Icelandic Confederation of Labour has produced a booklet containing information on rights and obligations in the labour market.

Employment contract

EEA nationals who work for two months or longer for the same employer are entitled to a written employment contract. An employment contract should include the following: the name of the employee, information about the employer, information on where the work is conducted, wages, employment period, termination clauses and membership in a pension fund and union.

Further information may be found on the websites of the Icelandic Confederation of Labour (ASÍ), the Directorate of Labour and individual labour unions.

It is important to check that:
  • your wages are in accordance with collective wage agreements;
  • your working time is no longer than that permitted by law and collective wage agreements;
  • leave is granted in accordance with law and collective wage agreements;
  • wages are paid during absence from work due to sickness or injuries;
  • you receive a pay slip when wages are paid;
  • your employer pays taxes on your wages;
  • your employer pays dues to your pension fund and union.

A payslip is a written confirmation of the amount of your wages and the charges that your employer has deducted from your wages, such as taxes and pension dues.

Bank account

Most employers pay wages directly into a bank account. Banks have differing requirements as to who can apply to open a bank account. All banks, however, will require you to have a national ID number and personal identification with a photo.

Statutory holidays

According to most collective wage agreements, those who have fixed wages will be paid for statutory holidays falling on a working day, just as though it were a regular working day, although working is not required on that day. Fixed overtime is not paid for work on such days. If you work on a holiday, you will receive special payment.

Pension fund      

All workers are obliged to pay dues to a pension fund. You will receive pension payments from the fund when you stop working due to age or disability. Your employer is required to hold back a certain part of your wages; this is the premium you pay to your pension fund, together with a matching contribution from your employer.

Problems at the workplace   

If communication problems arise in the workplace, you can seek information and assistance from your union representatives at the workplace, your trade union or the Multicultural Centre.

The largest unions are Efling-stéttarfélag, Verslunarmannafélag Reykjavíkur (VR) and union umbrella associations such as Bandalag háskólamanna (the Icelandic Confederation of Academics, BHM) and Bandalag starfsmanna ríkis og bæja (the Federation of State and Municipal Employees, BSRB).

Occupational safety and health

The Administration of Occupational Safety and Health in Iceland is the centre for occupational health and safety operations in Iceland. The role of the Administration of Occupational Safety and Health in Iceland is to ensure that attention is paid to employee safety and working conditions and that measures are in place to prevent accidents in the workplace. Information on the Administration of Occupational Safety and Health, together with information on health and safety at the workplace, can be found on the website of the Administration of Occupational Safety.

Recognition of education

Recognition of your qualifications can improve your status on the labour market, increase your employment prospects and lead to higher wages.

Several ministries are responsible for assessing and recognising overseas professional qualifications. More information and forms are available on the Menntagátt website.