The Union Alliance reached a preliminary agreement with the Confederation of Employers (SA) last week on the necessary prerequisite clauses in the collective agreements that are currently being negotiated. VR chose to break away from The Union Alliance and is therefore outside the agreement.
The prerequisite clauses that The Union Alliance has agreed with SA on include two timed review clauses in the four-year collective agreement.
The former clause means that if annual inflation has not fallen below a certain level, it is possible to terminate collective agreements. Revision work begins in April and the contract may be terminated at the end of October, provided conditions are met.
The government also needs to have fulfilled the promises made in relation to collective agreements.
The second review clause is scheduled a year later, in October 2026. Then collective agreements will again be terminable if annual inflation has not fallen below a certain level.
With strict conditions regarding inflation, the provisions will ensure purchasing power and at the same time strongly contribute to the reduction of interest rates, as it is the Central Bank’s policy to align interest rates with inflation at all times.
Additions to the contract are permitted instead of termination
However, if the conditions of the collective agreements are not met, it does not inevitably lead to the termination of the collective agreements. It is possible to negotiate a response to ensure the continuation of the contract, and it is in the hands of the wages and conditions committee, which will be appointed, to try to agree on such a response.
Also, the government must have fulfilled the promises made in relation to collective agreements at the same time. What those promises will be remains to be seen, but The Union Alliance has demanded that the public transfer system be restored, with the associated increased payments of child benefits, housing benefits, and interest benefits to workers.
The status of negotiations regarding cleaning, confidants and dismissal protection
Efling and the SGS have today met with SA about the section of the collective agreement that pertains to cleaners. It needs to be improved, but according to a survey by Varða, the labor market research institute, people who work in cleaning have the most difficult situation in the Icelandic labor market.
A decision still needs to be reached on other matters, including the increased dismissal protection of employees in the general labor market, as well as the increased rights of confidants. Both of these are issues that Efling has put a lot of emphasis on to be reviewed and corrected in the collective bargaining agreements.
Furthermore, a decision has yet to be reached on The Union Alliance’s demand for increased holiday entitlements, which means that the right to full leave is earned after a shorter period in the labor market than is currently the case.