Iceland - Union leader warns wage agreements could unravel - September 30, 2026

The private-sector collective agreements face a review deadline on 8 October, because annual inflation reached 5.6% in August, above the threshold that allows the agreements to be reopened. If the parties cannot agree on a response, a party that does not want the agreement to continue can terminate it on 8 October, and the agreement would then expire on 31 October. The chair of the Framsýn union in Húsavík, said that the labour market could face serious disruption if no acceptable package of measures is agreed with the Government. He welcomed municipalities' pledge to keep fee increases next year below 2.5%, but criticised planned central Government increases such as higher arrival charges and kilometre-based road fees.

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