About trade unions and their role

Trade unions have several roles that can be read about here.

On trade unions and their role

  • The role of trade unions

    Trade unions have several roles, and the main ones are to guarantee and improve the rights of its members and to negotiate on their behalf for better rights and wages in the collective wage agreements. Some of the biggest victories concerning rights in the labour market have come about as a direct result of the work of the trade unions and federations. The pension funds, maternity and paternity rights and regulations about the working environment are all rights that have be won by the unions.

    Trade unions are organisations protected by the constitution, legislations and international resolutions that Iceland is part of. They play an active and important role towards employers and their associations, bargain for collective agreements and they have the authority to declare strikes or work stoppage.

    Furthermore, the unions run various funds that the members can apply grants from. For example, sickness benefit funds and holiday/vacation funds where members can apply to rent summer houses or cottages for a short time.

  • Collective agreements and institutional contracts

    The right to negotiate is empowered by the unions affiliated to BSRB. Some collective agreements and institutional contracts can be found at the union’s website

  • Legal grounds

    The translation of these acts is published for information only. The original Icelandic text is published in the Law Gazette. In case of a possible discrepancy, the original Icelandic text applies.



    The laws and regulations that are most important for employees of the public sector are the following:

    • The act on collective agreement for public employees Act, No. 94/1986 - The act applies to all public employees and those that work in non-profit institutions. The act addresses the implementation of collective agreements, work disputes, labour court and union representatives.
    • The Government Employees Act, No. 70/1996 - The act addresses the rights and duties of government employees. The act divides the employees into two groups, civil servants and all other state employees since the act applies differently to those two groups. The list of civil servants can be found in chapter V, article 22. Among them are police officers, customs officers and prison wardens which are all affiliated to BSRB. 
    • The holiday allowance Act, No. 30/1987 - This act sets the minimum rights for holidays and holiday allowances for all employees in the labour market. Collective agreements often contain better rights and sometimes also employment contracts.
    • Regulation on advertising for vacancies -1000/2019  - A vacant post in the public sector shall be advertised according to the Government Employees Act, No. 70/1996. This regulation enlists further where and how to advertise for the vacancy. It also contains exceptions from the advertisement duty.
    • Local Authorities Act, No 138/2011 - The act applies to the administration and obligations of local authorities. The legal provision referring to employees of local governments other than managers are to be found in articles 56 and 57 of the act. It includes terms of employment, rights and obligations of the employees shall be subject to collective wage agreements in force at any time and the terms of the contract of employment. It also provides an obligation of confidentiality of the employees.
    • Administrative Procedures Act, No.37/1993  - The law applies when state and municipal authorities decide on employees’ rights and obligations for example when hired, reprimanded and when the employment is terminated. They are rules of procedure which means that they handle issues that authorities must take into consideration/account when making decisions. Examples of procedures are duty of guidance, right to be heard, investigation before conclusion and principle of equality against the parties to a case.
    • Equal Status and Equal Rights of Women and Men Act, No 10/2008 - The act applies to establish and maintain equal status and equal opportunities for women and men, and thus promote gender equality in all spheres of the society. All individuals shall have equal opportunities to benefit from their own enterprise and to develop their skills irrespective of gender. The act is comprehensive and addresses, for example, direct, and indirect discrimination, gender-based harassment and violence, sexual harassment and more. 
    • Act on Equal Treatment on the Labour Market, No. 86/2018  - This Act shall apply to the equal treatment of individuals on the labour market, irrespective of their race, ethnic origin, religion, life stance, disability, reduced working capacity, age, sexual orientation, gender identity, sexual characteristics, or gender expression, for example access to jobs, engagement and promotions, decisions in connection with wages and much more. The act prohibits any kind of discrimination and ensures that people with disability or with limited working capacity have the same rights as others.
    • Act on fixed term employment no 139/2003 (only in Icelandic) - The act applies to employees with a fixed term contract and set to ensure that the employees hired on these terms are not discriminated or treated less favourable than comparable permanent employees. Since a fixed term employment is an exception from indefinite hiring it is prohibited to extend such a contract for more than two years. But the law also states that if a contract is renewed or extended no later than six weeks after the former expired, then is counts as a new contract
    • Act on part-time workers No. 10/2004  - The act shall prevent any discrimination against part-time employees versus full-time employees. They shall not be treated with propositional less terms or be treated differently than those with full employment unless it is justifiable on objective grounds.

    For most parts there are similar rules that apply for employees of the state and the local government. There is a difference though on what sources apply. The rights of employees of the state are based on laws like the government employees act and collective agreements while rights of employees of local governments are based the collective agreements.

    For employees of the private market the following legislations are the most important: 

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