04 21. 2020

Enska 1.apríl 2020



Changes to wage terms 1 April 2020 according to collective wage agreements with SA (Confederation of Icelandic Enterprise)

Change to active working hours

Upon implementation, the pay for full-time work will be for 37 hours per week instead of 40, and salary for daytime work will be divided by 160 instead of 177.3. The hourly rate for daytime work will therefore increase by 8.33%, corresponding to moving payment for coffee breaks to active working hours. The arrangement for coffee breaks will be as before: 35 minutes per each working day. If fewer hours are paid per week/month for full-time work, the increase is calculated so that daytime wages for 37 hours per week/160 hour per month will be the same as were previously paid for more hours. If employees receive payments in in addition to the 40 hours per week (e.g. tool or clothing allowance), these will also increase by 8.33%.

There will be no changes to the arrangement coffee break during overtime work. They will continue to be paid breaks and if the breaks are not taken, the corresponding time will be paid in addition.

Example up to 31.03.2020

Monthly salary

Divided by

Hourly rate



ISK 2,885

Example from 01.04.2020 with the ISK 18,000 increase for all wages on 01.04. 2020.

Monthly salary

Divided by

Hourly rate

ISK 518,000*


ISK 3,238

·         All wages for daytime work will increase by at least ISK 18,000, or 112.50 per hour, as of 1 April 2020.

Changes to overtime premium

Overtime rate 1

Overtime rate 1 is paid for the first 4 hours per week, or 17.33 hours per month. The overtime premium will be 1.02% of the monthly salary for daytime work. Overtime rate 2 is paid for work in excess of this.

Overtime rate 2

  Overtime rate 2 is paid for all hours in excess of 17.33 overtime hours per month, and for night work between 00:00 and =6:00. The overtime premium will be 1.10% of the monthly salary for daytime work.

Monthly salary


Hourly rate

ISK 518,000


ISK 5,284

ISK 518,000


ISK 5,698

Shortening the working week

Employees have the right to request discussions on reducing working hours to 36 active working hours per week by waiving the right to coffee breaks, cf. Article  3.1.2 of the collective wage agreement. Company management can also request such discussions.

If the parties reach an agreement, due to better use of working hours and increased productivity, employees and employers will share the benefits, with employees enjoying a further reduction in active working hours of 13 minutes per day, or 65 minutes per week.

Further reduction of active working hours:

If there is an agreement on shortening the working week, active working hours will be 36 hours per week, without a reduction in the monthly salary (salary for daytime work will be divided by 156 instead of 160, with a 2.56% salary increase for daytime work).

Overtime work rate 1 will continue to be paid for the first 4 hours per week in excess of 36 hours of daytime work, or 17.33 per month.

The unions involved in these collective wage agreements are ready to assist with implementation and consult members on the shortening of the working week.

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