Collective Agreement Iceland

While Efling wanted to raise the minimum wage for its workers from ISK 300,000/month to ISK 425,000/month over three years, the signed agreement raises wages to ISK 390,000/month over the next three years and eight months. This concession, according to Efling, was made “in view of the economic situation that followed the bankruptcies and layoffs in the tourism sector and with the aim of creating favourable conditions for lowering interest rates”. However, the unions were not prepared to catch up and accept that wage increases be postponed or that employers` pension contributions be reduced. Following the announcement of new state measures to support businesses through the crisis, the board of directors of the Entrepreneurs` Association cancelled a vote and unanimously decided to maintain the agreement while recognising the importance of cohesion in the labour market. . . .

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