Iceland

Living and Working in Iceland

INTRODUCTION

Iceland is a member of the European Economic Area (EEA). The EEA consists of the EU plus Norway, Liechtenstein and Iceland. Swiss citizens are also included in the EURES cooperation. EU/EEA and Swiss citizens can look for and take up work in Iceland without a work permit and vice versa for Icelandic citizens in other EEA countries. New EU-8 members. Special rules: From 1 May 2006 freedom of movement for working people is extended to citizens of Poland, Lithuania, Czech Republic, Hungary, Slovakia, Slovenia, Latvia and Estonia. There are, however, special rules concerning registration. Employers are by law obliged to register new EU-8 citizens that they employ at the Directorate of Labour. The main purpose of this is to prevent discrimination, exploitation and social dumping. New EU members are entitled to the same wages and salaries as Icelanders.

The capital city is Reykjavik. Two thirds of the population live in the Capital area (Reykjavik, Kopavogur, Hafnarfjordur, Gardabaer). Akureyri is the largest town in North Iceland, Egilsstadir in East Iceland, Selfoss in South Iceland, Reykjanesbćr in the South West area (Keflavik), Akranes in West Iceland and Isafjordur in the Westfjords. Iceland has a population of approximately 300.000.

Language

The native language is Icelandic, which belongs to the Nordic group of the Germanic languages. Many Icelanders understand and speak English, and have knowledge of the Scandinavian languages.

Currency

The currency in Iceland is the Icelandic Krona (ISK). The currency rate 30 August 2006 was 89 ISK for 1 Euro. You can see the current exchange rates at the Central Bank of Iceland: Exchange rates

Time

Local time in Iceland is Greenwich Mean Time (GMT) all year round. One hour later than Central European Time during winter but two hours later in the summer time. When it is 12.00 in Brussels it is 10.00 in Iceland during summer (end March to end October), but 11.00 during winter, (end October to end March) when it is 12.00 in the UK it is 11.00 in Iceland during summer.

International dialling codes

To Iceland: + 354 and number From Iceland: 00 + country code and number

Emergency Services

The general emergency number in Iceland is 112. The number for the police is also 112.

ENTRY AND REGISTRATION DOCUMENTS

To work in Iceland you must have a full EEA passport.

EEA/EU citizens are free to enter Iceland for up to three months to look for work or to try to set themselves up in business.

Residence Permits

If you intend to stay in Iceland for more than three months you must apply for a residence permit to the Directorate of Immigration. (Citizens of Denmark, Norway, Finland, and Sweden, please note special Nordic Cooperation rules). The address of the Icelandic Directorate of Immigration is:

Utlendingastofnun,

Skogarhlid 6

IS-105 Reykjavik

Tel: +354 510 5400

Fax: + 354 562 3375

A residence permit is granted upon request to citizens of EEA countries when they have been accepted for employment or when they have begun to practice their profession or when they have set themselves up in business in Iceland. This document merely establishes your right of residence as a worker from an EEA country. A residence permit gives the right to stay and work in Iceland, except where other restrictions are stated. A residence permit given to an EEA citizen gives the right to return to Iceland without restrictions while the residence permit is valid. The residence permit is also important for transferring your full social security rights to the Icelandic State Social Security Institute, for citizens of the Nordic countries an Internordic Attest (Internordisk flytteattest / intyg) is serving the same purpose.

NATIOLNAL REGISTER

Every EEA-citizen moving to Iceland must submit a notice of moving if their stay will last more than three months. In all cases when you start working you must get a CPR or identification number (Kennitala), you need a signature of your employer or EURES in Reykjavik. The process at the National Register takes a few weeks. The kennitala is necessary for a tax card, and it is also necessary for opening a bank account. You get the tax card at the Tax office in the area where you work, in Reykjavik at Rikisskattstjori,

You find an application form for tax card on the www.rsk.is website, you can print it out, fill it in, fax or mail it. You get the kennitala at the:

National Register

(Hagstofa Islands)

Borgartun 30

IS-150 Reykjavík

Tel: +354-560 9800

Fax: +354-562 3312

You find the registration form for the kennitala on www.hagstofa.is then you can print it out , fax or mail it to the National register.

In order to get registered you must send a copy of your passport to the National register. Outside the Capital Area you contact the Syslumadur. Every subsequent move to a different address requires a new notice of changed residence to the National register.

HEALTH

If you are unemployed and looking for work in Iceland you should take a European Health Insurance Card with you. The European Health Insurance card is only valid for short term stay (less than 6 months) and until you start working. If you are working in Iceland you need a E-104 from your health insurance in your home land, it is also necessary to move your legal domicile to Iceland to be fully covered.

The Health Insurance card or E-form entitle you to receive urgent medical treatment free of charge, should you need it.

Health Care Services

In general, patients should start by consulting a general practitioner. General practitioners are employed by health-care centres. Patients have the right to seek help from the nearest health-care centre, but in the Reykjavík metropolitan area and Akureyri, individuals are assigned to a certain doctor at a health-care centre. Patients pay ISK 700 for consultation during daytime working hours or for the services of the health-care centres. Doctors at health-care centres and general practitioners refer patients to specialists if they think this is necessary. Patients have the right to consult a specialist without going through a general practitioner or a doctor at a health-care centre.

Specialist's service are rendered at the hospitals' outpatient clinics and by specialists in private practice.

Hospital

Patients can only be admitted to hospitals when they are referred by a doctor. In emergencies, patients may be admitted immediately to the hospital serving as the emergency hospital at the time. If the examination or treatment is not a matter of urgency, then a doctor will forward a request for admittance to hospital. In Reykjavík, all accidents and life-threatening and major diseases may be referred to the Emergency Ward of the National University Hospital (LSH). In Reykjavík, an emergency service is also offered by general practitioners after usual working hours at the Reykjavík Department of Public Health.

For further information about health rights contact:

The State Social Security Institute

www.tr.is

Tryggingastofnun Rikisins,

Laugavegi 114,

IS-105 Reykjavik.

Tel: +354-560 4400

Fax: +354-560 4451

SOCIAL SECURITY

Your social security rights in Iceland under the EEA agreement are the same as those applying within the EU. When you start to work in Iceland you will contribute to the Icelandic social security system and thus gain the right to benefits. The unemployment insurance is paid by the employer (Tryggingagjald), if the employer has paid it for a certain minimum period then you are insured without further formalities. Please note that you can transfer your rights from other EEA-countries. You can transfer the unemployment insurance you acquire in Iceland back home by getting the E-301 before you leave. Your employer fills in a form and the Directorate of Labour issues E-301 for you and sends to your address.

UNEMPLOYMENT

If you become unemployed in Iceland you can register with the local employment office, (Vinnumidlun) which can assist you. The minimum period of work to become entitled to unemployment benefit is 10 weeks of paid full-time work within the last 12 months, which entitles you to a partial benefit. Please note that if you bring the form E-301 with you, and you have worked 10 weeks in Iceland, you can get full unemployment benefit. If you bring an E-301 with you to Iceland, you can get unemployment benefit IF AND ONLY IF you fulfil the condition of 10 weeks of full time work in Iceland.

Transferring Unemployment Benefit

Those who are entitled to unemployment benefit in their own country and have been claiming this benefit for at least four weeks, may continue to receive it for up to three months while seeking work in Iceland. As a job-seeker with unemployment benefit you must report in person to the employment office every week as an active job-seeker.

You should inform the relevant administration in your own country of your intention to look for work in another country well ahead of your date of departure.

Your unemployment benefit administration will determine whether the conditions are fulfilled and gives you, before you leave, a form to be handed in to the local employment office in Iceland (Vinnumidlun) as soon as possible after your arrival there, no later than 8 days after your arrival in Iceland. This form (E303) secures the payment of your unemployment benefit in Iceland.

The Directorate of Labour administers the Icelandic Unemployment Insurance Fund. www.vinnumalastofnun.is

PENSIONS

If you work in two or more EU/EEA countries you can combine state pension contributions paid in each state to qualify for a state pension. For more information you should contact your own Social Security Administration. Furthermore, there is mandatory that every worker pays 4% of wages to a pension fund, and the employer pays 7%. When you are pensioned your Social Security Administration in your home land will check your rights in other EEA-countries and will administer the transfer to you.

For further information on benefits (except unemployment benefits) while living in Iceland contact:

Tryggingastofnun Rikisins

Laugavegi 114

IS-150 Reykjavík,

Tel: +354-560 4400

www.tr.is

TAXATION

Individuals residing in Iceland are subject to unlimited tax liability on all their income, wherever earned. As a general principle, any individual staying in Iceland for six months or longer is legally domiciled in Iceland.

INCOME TAX

Income tax is deducted at source in Iceland which means that the tax is withheld by the employer and remitted to the Government on behalf of the employed (Pay as you earn, PAYE). There is one main income tax bracket which in 2004 is 36,72% (23,74% National Income Tax and 12,98% Municipal Income Tax). A full personal exemption is ISK 29.029 per month, and the 4% to the pension fund are not taxed. In practice income under the limit of 75.000 ISK per month is free of Income tax, and the income above 75.000 is taxed by 36,72 %. The tax authorities issue a tax card that is necessary when you work in Iceland and a prerequisite for getting a personal exemption. (see below under "Taxation of Visitors").

Example:

Monthly salary (gross) 120.000

4% paid to a certified pension fund 4.800

Taxable income 115.200

Tax 42.301

- Personal exemption -29.029

Income tax 13.272

Net salary 101.928

If you work on a farm a part of your salary is accommodation and food, which is also taxable income.

If you earn 150.000 ISK per month, the net salary will be 120.152

Another example:

Monthly salary (gross) 200.000

4% paid to a certified pension fund 8.000

Taxable income 192.000

Tax 70.502

- Personal exemption -29.029

Income tax 41.473

Net salary 150.527

Usual1y 1% Union fee is deducted from the monthly salary (gross).

If you stay in Iceland for a maximum of six months you pay taxes only on the income you have received in Iceland. You are expected to send an income report to the tax authorities a week before you leave, for calculating the final amount of tax, in some cases there may be a partial refund.

Taxation of Visitors staying more than six months in Iceland

If you stay in Iceland for more than six months you will be taxed in the same manner as an Icelandic citizen.

Tax offices

You can find the addresses of the Tax offices on www.rsk.is . There is one in Reykjavik and one in Hafnarfjordur (which is also for Keflavik), South Iceland: Hella, East Iceland: Egilsstadir, Northeast Iceland: Akureyri, Northwest Iceland: Siglufjordur, Westfjords: Isafjordur, West Iceland: Akranes.

More info:

www.rsk.is : information material in English and Danish, direct link:

http://www.rsk.is/sho...temporarily.asp&val=1.0

Top

EMPLOYMENT ISSUES

Remember that your national employment protection legislation does not extend to work wholly or mainly outside your own country. There are certain rules that are common in all EEA-countries, besides that terms and conditions are a matter of agreement between the employer and yourself.

Contracts

Employment contracts should be written, but in many fields oral contracts are usual. According to law you are entitled to a contract in writing. Please note the special rules for new EU-8 members: The employer must give the employee a written contract before starting work and send a copy to the Directorate of Labour.

Once you get a job offer, you must get a residence permit from the Icelandic Directorate of Immigration if the duration of the work is more than 3 months. If you are offered a contract check carefully the terms and conditions of employment so that you understand fully what is written in the contract. Check the method and frequency of your pay. You are likely to be paid directly into a bank and you will, therefore, need a bank account.

Annual leave entitlement holiday is a minimum of 24 days after working a whole year, plus 15 days' of public holidays. All wage earners are entitled to holiday pay, in proportion of the length of time they work.

Professional Organisations

In Iceland most employees belong to a union or professional body. To join, contact the representative at your place of employment. Trade unions: www.asi.is, http://www.vr.is/ , http://www.efling.is/

Salary

Wages and other terms of employment concluded in Icelandic collective agreements are minimum tersm, applying to all workers in the relevant occupation within the area covered by the agreement. The wages according to the collective agreement have status as legal minimum wages for the sector, e.g. for carpenters. The working week is 40 hours, over 5 days (40 hours are paid, but active working time is 37 hours and 5 minutes). Some overtime is usual in the general labour market.

Minimum salary for unskilled workers on the private labour market in 2006 is 110.000 Icelandic kronas per month, there is a recent agreement for the next years.

The Icelandic Federation of Labour Unions has issued a handbook on labour law where you can find detailed information.

http://www.asi.is/upload/files/labourlaw(1).pdf

ACCOMMODATION

The Icelandic market for privately owned accommodation is large, comprising in principle 75-85 per cent of the housing stock. The market for rental accommodation is, therefore, limited. The rent in Reykjavik and the capital area is generally higher than in most other towns.

The housing situation varies from one locality to another.

In the Reykjavik area the website www.leigulistinn.is has some offers, the newspapers www.mbl.is www.frettabladid.is (all in Icelandic). You can also advertise on posters (billboards) of supermarkets and universities.

Accommodation for rent is mostly unfurnished. Rent is normally paid on a monthly basis, at least one month in advance. In the Reykjavik area small hotels and guesthouses may be the best option for short term when you are finding a more long term solution. www.gisting.is

Top

EDUCATION

Learning Icelandic
If you plan to stay and work in Iceland for a longer period of time learning Icelandic is a good idea. Fair English is often sufficient for many kinds of unskilled manual jobs. If you want a job that requires communication with customers and more specialized jobs speaking Icelandic is usually required. There may be some exceptions in high tech jobs. As a rule of the thumb speaking Icelandic would mean 20% higher salarly. In the Reykjavik Area you can learn Icelandic at the Reykjavik Municipal Center for Adult Education. www.namsflokkar.is If you are a member of a trade union you can get some financial support for paying the course fees.

The University of Iceland offers courses in Icelandic for foreigners at an academic level www.hi.is The University Institute of Continuing Education offers evening courses in Icelandic www.endurmenntun.is

The school system
The Icelandic school system consists of primary schools, secondary schools and higher education.

For information on State and private education contact:

Ministry of Education, Science and Culture

Sölvholsgötu 4

IS-101 Reykjavík

Tel: +354-545 9500

Fax: +354-562 3068

www.menntamalaraduneyti.is

Primary school

Children need to attend school between the age of 6 and 16. The school is free of charge. The school year begins in the last week of August and lasts for 9 months, or until May31.

Secondary schools

Upper secondary schools offer programmes that vary from one to four years in length.

Courses may be theoretical or vocational in nature, depending upon their objectives.

Grammar schools (menntaskolar) which offer only academic programmes of study conclude with a matriculation examination (studentsprof, in German = Abitur, English = A-level).

The course of studies at these institutions takes four years, and those who complete their studies satisfactorily are entitled to apply for university.

Industrial vocational schools (idnskolar), which offer almost exclusively vocational programmes prepare the students for skilled work. Comprehensive schools (fjölbrautarskolar), offer academic programmes comparable to that of the grammar schools, practical training like the vocational schools and, in addition, other programmes providing specialised practical training. Specialised vocational schools, (serskolar) offer particular programmes as preparation for specialised employment.

Universities

Higher education is mainly provided by universities. In addition there are a few institutions which offer programmes at university or higher educational level. Excluding registration fees there are no tuition fees at the state run institutions of higher education. Entry to most institutes of higher education is open to those who have matriculated from an Icelandic upper secondary school or comparable schools in other countries. In some institutions or departments additional requirements such as vocational training or work experience are requested. (www.hi.is , www.unak.is www.ru.is )

Many textbooks are in English or Scandinavian. The language of most courses is Icelandic, with an increasing number of courses offered in English. First year students are allowed to take their exams in English.

The Office of International Education is a service organization for all higher education institutions in Iceland. Furthermore, the office hosts the Socrates National Agency in Iceland, which takes care of the Socrates programmers at all school levels. All the universities and colleges in Iceland participate in Socrates/Erasmus, and the Office of International Education is the Erasmus office for all the institutions. Also, the office runs an Information Centre, whose main purpose is to provide information on studies abroad. www.ask.hi.is : +354 585 5850 - e-mail: ask@hi.is

Study support

If EEA-citizens have been employed for at least five years in the EEA-area and have lived in Iceland for one year, they have the right of support for vocationally based studies in Iceland.

Research opportunities

You can find special research opportunities at the new Pan-European Research Mobility Portal www.eracareers.is

COMPARABILITY OF QUALIFICATIONS

According to the EEA treaty, higher degrees, which took at least three years to earn, and vocational studies with a secondary school education, will be recognised by the other EEA countries. Find out before going to Iceland if your degree is comparable with an Icelandic one. In Iceland you can find out by contacting the Ministry of Education and Culture which will tell you about the comparability of your qualifications with the equivalent in Iceland both at academic as well as at vocational level.

The co-ordinator in Iceland is:

Menntamalaraduneytid,

The Ministry of Education, Science and Culture

Sölvholsgötu 4,

IS-150 Reykjavík

Tel: +354-545 9500

Vocational and professional qualifications

Direct link to the national reference point for assessment and recognition of vocational qualification:

http://menntagatt.is/default.aspx?pageid=281

and the trade unions www.asi.is if you need trade specific information.

For details of the Icelandic equivalent of your academic qualifications contact:

www.ask.hi.is

Top

CULTURE

You should remember that the way of life, customs, educational methods and standards in other countries can be different from those at home.

You can get more information on http://www.iceland.is/ (The official gateway to Iceland), http://www.reykjavik.is/,

www.menning.is

LEGAL MATTERS

Once in Iceland you will be subject to Icelandic laws. In the event of any legal problems contact your Embassy (see: www.mfa.is/consular-information/ )

CHECKLIST

Before you take up employment in Iceland ensure that:

•You have a full ten year EEA/EU passport. •You fully understand the contract which details clearly the terms and condition of your employment. •You know the method and frequency of payment of any salary. •You know what travel arrangements need to be made and whether you or the employer will pay for them. •You have accommodation in the area you will be moving to. •You have the E -104 certificate which entitles you to sickness benefits in Iceland. Or you have the EU Health Insurance Card •You bring your E-301 certificate with you which confirms your unemployment insurance and working period in your homeland which can entitle you to unemployment benefits if you have worked 10 weeks in Iceland •You have sufficient funds which last you until you get paid or, if necessary, your return home.

www.iceland.is The gateway to Iceland.

www.icelandreview.com With daily news from Iceland

www.tr.is (With English, Danish ... version) Social Security

www.utl.is/ (Icelandic Directorate of Immigration)

www.hagstofa.is or www.statice.is (The National Register of Persons) Hagstofa Islands,

Statistics Iceland (Information about the economy, labour

market, population etc)

www.rvk.is The homepage of the City of Reykjavik

www.asi.is (the Icelandic Federation of Labour, also with links to Language

school, Icelandic for foreigners.

www.hi.is (University of Iceland), www.unak.is (the University at Akureyri, North Iceland).