The labor market is a forum for employers and employees. The rules of the labor market are laid down in laws and wage agreements that state the mutual obligations of employers and employees.

The labor markets is divided into general and public labor market. Privately owned companies operate in the general labor market, while in the public labor market,there are companies and institutions owned by the state and municipalities, as well as companies and institutions that provide public services.

Different laws and rules apply to various extents to the general and public labor market.

General information about the labor market can be found on the website Ísland.is.

Information about wage collective agreements can be found on the websites of the unions.

Information on wages and the wage terms on which they are based shall be stated in the employment contract.

Collective wage agreements provide for minimum wages for a particular job, taking into account age and/or length of service. An employee may negotiate with the employer for terms that are better than the minimum terms that collective wage agreements provide.

General information about wages can be found on the website Ísland.is.

In Iceland, many rights are bound by laws or regulations:

Facilities and safety in the workplace, working hours, holiday entitlement (summer or winter holidays), protection of mothers and pregnant women, response to bullying, harassment, and violence in the workplace, personal protection, equality, and provisions for dismissal are among these. Collective wage agreements also have provisions for sick leave, work contribution, and provisions for hiring and dismissal.

Information about holiday rights in the labor market can be found on the website Ísland.is.

Information on equality in the labor market can be found on the website Ísland.is.

Information about sickness rights in the labor market can be found on the website Ísland.is.

Employees are obliged to follow what is stated in the employment contract.

Everyone is encouraged to have a conversation with employers, the next supervisor, or the union about what is expected and to ask about the uncertainties that exist.

To start a company you must be at least 18 years old and legally competent. You must not be seeking or receiving a suspension of payments and you may not be in bankruptcy proceedings.

Certain kinds of operations require a special permit or license, which are, in most cases, regulated by the Administration of Occupational Safety and Health or another entity depending on the nature of the business.

Information on how to start a business can be found on the website Ísland.is.

The Directorate of Labour service offices are public employment offices. Job seekers are provided with many different kinds of assistance in their job seeking, regardless of whether they are registered on the unemployment list. This service is free of charge.

General information about job seeking can be found on Ísland.is

Looking for a job is quite a task that requires time, knowledge, and good tools. It is important to organize yourself, set goals, and think about the next steps so that the job search will be more effective and the goal will be reached as soon as possible.

It is common for people to go directly to the companies and organizations they are interested in working for, and it is important to check their websites for vacancies.

You can register for a job search on the website of The Directorate of Labour, but there are new jobs listed daily, and it is also advisable to register with other recruitment services and monitor which jobs are advertised there.

The network is no less important and it can be a good idea to let as many people know that you are looking for a job.

General information about job seeking can be found on the website of The Directorate of Labour.

Various ways are possible in the job search. The more ways that are used, the greater the possibilities.

You can get help looking for a job due to a reduced working capacity at The Directorate of Labour.

More information on job search for people with reduced work capacity on the website of The Directorate of Labour.

It is possible to register for a job search at The Directorate of Labour  and thus receive assistance in looking for a job. More information is available at:

• The Directorate of Labour
• Ísland.is

Examples of job search sites:

• Alfreð.is
• Starfatorg
• Störf.is
• Job.is

The role of unions is first and foremost to negotiate, on behalf of their members, wages and other employment terms in collective wage agreements and to protect their interests in the labor market.

General information about trade unions can be found on Ísland.is.

In unions, wage earners join hands, based on a common occupational sector and/or education, in protecting their interests.

Unions provide their members with information and legal consultancy services about the terms that acts of law and collective wage agreements ensure for them. Union employees are bound by obligations of confidentiality to members seeking their rights.

Diverse social and educational activities take place within the unions.

A range of information on the activities of unions and wage terms may be obtained from the offices of unions and their websites.

Unions are open to all in the sector involved in its area of operation. Each union establishes further rules on membership.

According to laws and collective wage agreements, all wage earners pay a fee from their wages to the union. The fee accrues to the union that has negotiated the collective wage agreement on which the employee's terms of employment are based.

The fee is paid through the employer, who deducts the fee from the employee's wages and transfers it to the union in question.

Employees do not need to be member of a union if they so choose. They are, however, still required to work by statutory collective wage agreements.

There are five unions in business in Suðurnes:

• Verkalýðsfélag Grindavíkur 
• Verkalýðs- og sjómannafélag Keflavíkur og nágrennis (VSFK)
• Verkalýðs- og sjómannafélag Sandgerðis (VSFS)
• Starfsmannafélag Suðurnesja
• Stjórnendafélag Suðurnesja

The majority of unions form larger sector-based or geographically-based federations. These federations of unions come together in four employee umbrella associations. 

• Icelandic Confederation of Labour (ASÍ)
• Federation of State and Municipal Employees (BSRB)
• Association of Academics (BHM)
• The Icelandic Teachers' Union (KÍ)

Information about grants, sponsored funds, and education can be found on the websites of the unions.

Tax is paid on all income and other financial income.

All persons who are taxable in Iceland and have income above the tax-free threshold pay taxes on their wages, which go to the national common fund.

Tax on personal wages is divided into income tax on the one hand to the state and on the other hand into municipal tax on the other.

The employer deducts the withholding from the wage of the employee and returns it to the collector of the Treasury.

Self-employed individuals are responsible for withholding payment to the Treasury themselves. Income tax is paid in 3 levels depending on how much people earn.

Information about tax on wages and pensions can be found on the website Ísland.is.

The withholding tax deducted on wages is in three tax brackets. Individuals with payments from more than one employer need to make arrangements to ensure that the correct percentage of tax is deducted from their wages, to avoid tax debt at the end of the year in the tax assessment.

Information about income tax levels can be found on the Ísland.is.

It is mandatory to file a tax return to Skatturinn - Revenue and Customs in March each year. 

In the tax return, a person declares their income, assets, and liabilities from the previous year.

Information on tax returns and assessments can be found on the website Ísland.is.

It is possible to get instructions and help with tax returns from Skatturinn.

Information and instructions on filing tax returns are available on Skatturinn.is.

Assistance with the preparation of tax returns is only available from the Tax Office, and not from other state institutions or local authorities.

Sometimes student associations of law students at the universities hold so-called Tax Days and offer free help in preparing tax returns.

The days are usually advertised on the websites of the schools or the student associations.

The personal tax credit is a tax deduction people can use to lower the tax withdrawn from their salaries by their employer.

People 16 years and older who are domiciled in Iceland are entitled to the personal tax credits. Those turning 16 get a full personal tax credit for the entire year, no matter when their birthday is within the year.

Information about personal tax credits can be found on Ísland.is and Skatturinn.is