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Vacation and Leave Policies

Understand the regulations on vacation and other types of leave in Iceland

Holiday leave

In Iceland, all employees who have worked throughout a full accrival year are entitled to a minimum of 24 paid vacation days annually, as per the Act on Holidays and Holiday Allowance. The accrual year for vacation runs from May 1st to April 30th, and employees earn a minimum of 2 vacation days per month of employment. It's worth noting that some sectors or companies may offer additional vacation days beyond the legal minimum through collective agreements.

Vacation Pay (Holiday Allowance)

The law mandates employers to pay a vacation allowance for the vacation time accrued by employees. The minimum vacation allowance stands at 10.17% of an employee's total wages. However, this percentage can increase based on collective agreements or the length of service within a company or sector.

Additional Vacation Entitlements

Employees can qualify for extra vacation days based on their duration of employment in the same company or sector:

  • After 5 years in the same sector: 25 vacation days
  • After 5 years in the same company: 27 vacation days
  • After 10 years in the same company: 30 vacation days

Scheduling and Taking Vacation

The typical period for using accrued vacation time is between May 2nd and September 1st. However, employees can negotiate with their employers to take leave outside the traditional summer period.

Important Notes

For part-time employees, vacation entitlements are prorated. As a general rule, unused vacation time should be taken within the subsequent accrual year, although specific arrangements may exist within collective agreements. Employers also have some right to schedule holidays within reason to maintain business operations.

Public holidays

Public holidays in Iceland offer a mix of religious, historical, and seasonal celebrations. Here's a breakdown of the prominent ones:

Religious Holidays

  • New Year's Day (N√Ĺ√°rsdagur): January 1st
  • Maundy Thursday (Sk√≠rdagur): The Thursday before Easter Sunday
  • Good Friday (F√∂studagurinn langi): The Friday before Easter Sunday
  • Easter Sunday (P√°skadagur): Variable date. Check annually.
  • Easter Monday (Annar √≠ p√°skum): The day after Easter Sunday
  • Ascension Day (Uppstigningardagur): 39 days after Easter Sunday
  • Whit Sunday (Hv√≠tasunnudagur): 49 days after Easter Sunday
  • Whit Monday (Annar √≠ hv√≠tasunnu): The day after Whit Sunday
  • Christmas Eve (A√įfangadagur): December 24th (from noon)
  • Christmas Day (J√≥ladagur): December 25th
  • St. Stephen's Day (Annar √≠ j√≥lum): December 26th
  • New Year's Eve (Gaml√°rsdagur): December 31st (from noon)

Seasonal & Historical Holidays

  • First Day of Summer (Sumardagurinn fyrsti): The first Thursday after April 18th.
  • Labor Day (Verkal√Ĺ√įsdagurinn): May 1st
  • Icelandic National Day (√ěj√≥√įh√°t√≠√įardagurinn): June 17th
  • Commerce Day (Fr√≠dagur verslunarmanna): First Monday of August

Types of leave

In Iceland, labor laws ensure that employees have access to various types of leave for personal and family needs.

Vacation Leave (Annual Leave)

Employees are entitled to a minimum of 24 paid days per year for rest, relaxation, and personal time. This accrues at a rate of 2 days per month of employment.

Sick Leave

Employees are lawfully entitled to sick leave. In many cases, employers pay sick leave for some time, with duration varying based on collective agreements or contracts. After the employer-paid period, employees may be eligible for extended sick leave payments from the Social Insurance Administration.

Parental Leave

Parents are entitled to up to 12 months of shared parental leave. This includes 3 months earmarked for each parent and an additional 3 months that are transferrable between the parents. During this leave, parents receive 80% of their salary.

Maternity Leave

Maternity leave is considered part of the overall parental leave entitlement, with specific protections for expecting mothers.

Paternity Leave

Paternity leave is also a protected part of the overall parental leave structure, with specific time allotted for fathers.

Bereavement Leave

Employees are typically entitled to a brief period of bereavement leave upon the death of a close family member. The specific regulations can be found within individual employment contracts or collective agreements.

Other Types of Leave

  • Jury Duty Leave: Employees are entitled to leave for fulfilling their responsibilities as jurors.
  • Military Leave: Provisions exist for individuals called for military service.
  • Educational Leave: Some agreements may provide for leave in order to pursue further education or training.
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