Efling Union, along with the Icelandic Confederation of Labour (ASÍ) and the Federation of General and Special Workers in Iceland (SGS), has filed a complaint with the Competition Authority regarding illegal collusion among companies in the catering industry and within the Association of Companies in the Catering Market (SVEIT).
The complaint is directed at both SVEIT and its member companies, which entered into a collective agreement with the pseudo-union Virðing. In reality, Virðing is controlled by catering companies, and the agreement involves consultations on wage terms, constituting a violation of competition law.
SVEIT was founded in 2021 and has systematically sought to undermine employee conditions in the catering sector. The association requested collective agreement negotiations with Efling in 2022, but its strategy aimed to reduce bonus payments and extend daytime working hours. When Efling rejected negotiations, SVEIT turned to SGS with the same demands, which SGS also rejected, refusing to take part in attempts to erode workers’ rights in Iceland.
SVEIT subsequently sued Efling before the Labour Court, demanding recognition of its authority to negotiate on behalf of its member companies. However, the court dismissed all of SVEIT’s claims. In November 2023, the court confirmed that the existing collective agreement between Efling and the Confederation of Icelandic Enterprises (SA) is a minimum wage agreement that must apply to SVEIT’s member companies.
Despite this ruling, SVEIT has continued its attempts to diminish workers’ rights and benefits—most recently by establishing the pseudo-union Virðing. SVEIT and Virðing signed a so-called collective agreement that significantly reduces employee benefits and violates multiple legal provisions.
The complaint to the Competition Authority is based on the following grounds:
- The agreement between SVEIT and Virðing is not a legitimate collective agreement but rather a unilateral decision imposed by employers.
- It constitutes unlawful price negotiations on wage terms in the catering sector.
- The price negotiations were conducted at the SVEIT level, in direct violation of competition law.
Virðing is not a genuine union but a front for employer interests. It provides no services and has no contact information on its website. Furthermore, its so-called collective agreement with SVEIT erodes employees’ terms and rights. Additionally, Virðing’s founders and board members are all either restaurant owners themselves or closely connected to them, being their spouses or children.
Efling, ASÍ, and SGS condemn this attack by restaurant owners on workers’ rights and the blatant violation of competition law. They call on the Competition Authority to take action.
The complaint can be found here, though only in Icelandic.