Union split raises stakes as wage talks continue

A labour coalition has extended its collective agreements with the Confederation of Icelandic Enterprise, leaving VR, LÍV and the Fagfélögin unions negotiating on their own. Talks are due to continue today, mbl.is reported.

The coalition, made up of the Icelandic Trade Union Federation, Efling and Samiðn, signed the extension on Tuesday evening. VR chair Halla Gunnarsdóttir said the deal was far from what her union considered necessary to keep the agreements in force.

Representatives of VR, the Electrical Workers’ Union and the Confederation of Icelandic Enterprise met on Tuesday morning. Union representatives requested a second meeting, which took place in the evening. Halla said the employer group needed to make concessions.

VR has said there is a realistic chance it will terminate its agreement. The union’s board received an unrestricted mandate from its council of shop stewards this week to do so. Halla said that if the agreement is terminated, the union would make broader demands covering working hours, wage increases, rights and other matters.

She also warned that public-sector unions could gain the right to terminate their agreements, potentially escalating the dispute. Halla said many members had experienced real wage cuts and that the union could not lock them into further declines.

By wage cuts, Halla meant that collectively agreed pay rises are now below inflation after the agreements’ conditions clause failed. The Confederation of Icelandic Enterprise and the government, she said, have instead pointed to an analysis conducted this summer that found purchasing power had increased across all income deciles.