Iceland
Capital: Reykjavik
Currency: - ISK
Iceland Labor Law and Employment Policy Overview
Employment Law Overview
- Key Legislation:
- Labor Relations Act
- Collective Bargaining Act
- Occupational Safety and Health Act
- Legal Characteristics:
- Emphasis on social dialogue and collective bargaining
- Aims to protect employee rights and promote workplace equality
Employment Contract Requirements
- Contract Types:
- Fixed-term contracts
- Indefinite-term contracts
- Contractual Provisions:
- Mandatory inclusions:
- Parties' identities
- Place of work
- Nature of work
- Start date
- Contract duration (if applicable)
- Paid time off information
- Notice period for termination
- Salary
- Regular working hours
- Other common provisions:
- Pension plans
- Collective bargaining agreements
- Union membership
- Mandatory inclusions:
- Language and Currency:
- Contracts must be written in Icelandic
- Currency is the Icelandic króna (ISK)
Working Time Regulations
- Standard Working Hours: 40 hours per week
- Rest Days and Breaks:
- Minimum of 24 hours of rest per week
- Minimum of 11 hours of rest per day
Leave Policies
- Annual Leave: Minimum of 24 days per year
- Public Holidays: 12 days
- Special Leave:
- Sick leave: 2 days per month, accumulating to 24 days per year
- Maternity leave: 6 months, with 1 month transferable to the father
- Paternity leave: 6 months, with 1 month transferable to the mother
- Parental leave: Up to 13 weeks, unpaid
Employee Dismissal and Contract Termination
- Notice Periods:
- 1 year of service: 1 month
- 3 years of service: 2 months
- 5 years of service: 3 months
- Severance Pay: Not legally mandated, but may be provided by collective agreements
- Unfair Dismissal Protection: Employees are protected against dismissal for:
- Discrimination
- Pregnancy or childcare
- Union activities
Taxation
-
Personal Income Tax:
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Salary Range (ISK) Tax Rate 0 - 409,986 31.45% 409,987 - 1,151,012 37.95% 1,151,012 and above 46.25%
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Social Security Contributions:
- Employee: 11.5%
- Employer: 22.07%
Health Insurance
- Insurance Policy: All residents must participate in the national healthcare system
- Coverage: Covers most medical services
Compensation and Benefits
- Minimum Wage: Set by collective agreements
- Salary Structure: Typically includes base salary, bonuses, and allowances
Work Permits and Visas
- Permit Requirement: Non-European Economic Area (EEA) citizens require a work permit
- Application Process:
- Employer applies to the Directorate of Immigration
- Employee applies for a visa at the local Icelandic embassy or consulate
Confidentiality and Non-Compete Clauses
- Enforceability: Enforceable, but must be reasonable and limited
- Common Provisions:
- Confidential information
- Non-competition obligations
Training and Development
- Legal Requirements:
- Employers must provide safety training
- Government Support: Government-funded training programs available
Workplace Diversity and Inclusion
- Legal Requirements: Prohibits discrimination based on race, gender, religion, or sexual orientation
- Enforcement: Office of the Equality and Human Rights Ombudsman responsible for enforcement
Remote Work Policies
- Legal Framework: No specific regulations, but remote work is permitted
- Tax and Insurance Implications: Tax and social security implications of remote work depend on the specific circumstances
Authoritative Website Addresses
- Icelandic Confederation of Labour: https://www.afl.is/
- Icelandic Social Security Administration: https://www.tryggingastofnun.is/