ICELAND PEO & EOR
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DID YOU KNOW
- Due to its location near the Arctic Circle, Iceland experiences the ‘Midnight Sun’ in the summer, which allows for almost 24 hours of daylight! During the winter, there are extended periods of darkness.
- Iceland is a global leader in renewable energy production, with around 85% of its energy coming from renewable sources such as geothermal and hydropower.
- Icelandic folklore is rich with stories of elves and mystical creatures known as the ‘Huldufólk’. Belief in such creatures is widespread, and in some cases, construction projects have even been altered to avoid disturbing them.
- It is widely believed that the first European to discover the Americas was Icelandic Norse explorer Leif Erikson, with the Norse settlement of ‘L’Anse aux Meadows’ in Newfoundland being carbon dated to between 990 – 1050 CE.
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Working in Iceland
Employment Information
Renowned for its work-life balance and employee-friendly policies, Iceland maintains a similar approach to working hours. Typically, employees in Iceland are contracted to work a maximum of 40 hours per week, which equates to 8 hours a day over a 5-day workweek. These ordinary daily hours are often defined as ‘the standard working day,’ usually spanning from 9 am to 5 pm.
However, Iceland places a significant emphasis on respecting leisure time and personal well-being. Because of this, employees can utilize any hours worked outside of the standard 9 to 5 to negotiate overtime rates. This flexibility not only rewards employees for their dedication but also encourages a healthy work-life balance, aligning with the country’s commitment to fostering a harmonious work environment. On top of this, Iceland was also one of the first nations to start trialling a four-day working week, with the world’s largest pilot occurring between 2015 and 2019.
Employee Leave
Both full-time and part-time workers are entitled to a minimum of 24 weekdays of annual leave per year. Additionally, some employees may receive ‘annual leave loading’ as extra pay. Casual employees, while not entitled to paid leave, can negotiate unpaid leave terms with their employers.
Annual leave starts accruing from the start of an employment contract, and employees can take paid leave at any time within the first 12 months, even for partial days. Employers and employees must mutually agree on the timing of annual leave, and employers may only deny requests with valid reasons. Any accrued, unused annual leave must be compensated when the employment contract ends, which includes ‘annual leave loading’ if applicable.
Furthermore, Icelandic labor laws provide for sick leave, allowing employees time off when unwell or injured, or when caring for a sick or injured family member or household member in unexpected emergencies. Employees can take up to 10 days of sick/carer’s leave annually, the specific amount depending on their weekly work hours. Any sick leave that exceeds 10 days will entitle the employee to sick leave payments from the Social Insurance Administration for up to 52 weeks.
Any unused sick leave may carry over to the following year, but employers are generally not obligated to pay for unused sick leave upon employment termination.
Public Holidays
Iceland observes a variety of local and national public holidays, in which some employees are not required to work. These include:
- New Year’s Day (Nýársdagur)
- Maundy Thursday (Skírdagur)
- Good Friday (Föstudagurinn langi)
- Easter Sunday (Páskadagur)
- Easter Monday (Annar í páskum)
- First Day of Summer (Sumardagurinn fyrsti)
- Labour Day (Verkalýðsdagurinn)
- Ascension Day (Uppstigningardagur)
- Whit Sunday (Hvítasunnudagur)
- Whit Monday (Annar í hvítasunnu)
- National Day (Þjóðhátíðardagurinn)
- Commerce Day (Frídagur verslunarmanna)
- Christmas Day (Jóladagur)
- Boxing Day (Annar í jólum)
Please note that some holidays, like Easter and Pentecost, have variable dates each year based on the Christian calendar.
Visas
Iceland offers a range of work visas to accommodate expatriates seeking opportunities in the country. Some key visa options include:
- Work Permit – Allows individuals to work temporarily in Iceland, typically sponsored by an employer.
- Residence Permit for Work – Enables skilled workers nominated by employers to live and work in Iceland for an extended period.
- Specialist Permit – A temporary visa for highly specialized workers completing short-term projects.
- Entrepreneurial Residence Permit – Tailored for individuals looking to establish or develop new businesses in Iceland.
- Research and Study Permit – For academics and researchers pursuing educational or research opportunities.
- Family Reunification Permit – Allows family members of Icelandic residents or workers to join them in the country.
- Artist Permit – Designed for artists and performers seeking to engage in cultural activities.
- Sports Permit – Catering to athletes and sports professionals participating in sporting events in Iceland.
- Student Permit – For international students pursuing education in Icelandic institutions.
- Au Pair Permit – Facilitates cultural exchange by allowing individuals to work as au pairs in Icelandic households.
All of these visa categories cover a diverse range of professions, ensuring that Iceland welcomes a variety of talent and expertise from around the world.