News - 17.01.2024

SA rejects the Union Alliance approach to national reconciliation

The Union Alliance, a coalition of the biggest unions within the Icelandic Confederation of Labor (ASÍ) began negotiations with the Confederation of Employers (SA) on December 28. At that meeting, the Union Alliance presented its proposals for specific salary increases in a three-year collective agreement, with detailed demonstrations and arguments. Those proposals were very moderate and based on a well-known model, the socalled Lífskjarasamningur, (e. Living Wage Agreement) from 2019.

The total cost estimate of the Union Alliance proposals is well within the limits assumed by the Central Bank in its National Economic Forecast for the next three years. The labor union movement submitting proposals that are within those limits, at the beginning of negotiations for renewal of contracts, is nearly unheard of.

On the basis of these proposals a positive tone was struck which both parties, the Union Alliance and SA, expressed in the media. The parties issued a joint statement, following a meeting where the Union Alliance presented its proposals, where they called for restraint on price increases. At the same time both parties warned about runaway wage drift, a message that is unique that the labor movement in Iceland sends out in unison with employers.

Since then a time consuming and sometimes very technical discussion has been ongoing between the two parties about computational models. In those discussions SA has gradually backed away from their initial, positive response. SA has decided that the Union Alliance proposals are too costly. Instead SA has put forward their own proposals that are far below the modest increases that the Union Alliance put on the table at the beginning of the negotiations. The Union Alliance has countered SA approach with data and arguments in accordance with established methods. For more than a week there has been no progress in the negotiations due to SA opposition to the Union Alliance wage proposals.

The Union Alliance wants to encourage SA to turn from this backword path and take a step forward. A great responsibility rests on both parties to move in sync to reach the goal. That goal is a comprehensive collective agreement, supported by long-overdue reforms of the public redistribution systems, where modest flat wage increases will be a premise for lowering inflation and interest rates.

For its part the Union Alliance has responded to society’s call for responsible collective agreement and expects the same from others. The Union Alliance urges SA to take a closer look at its moderate proposals and reciprocate the Alliance’s willingness to negotiate, thus clearing the path to successful collective agreement.

On behalf of the Union Alliance

Eiður Stefánsson, chairman of the negotiation committee of Landssamband íslenzkra verzlunarmanna
Hilmar Harðarson, chairman of Samiðn – samband iðnfélaga
Ragnar Þór Ingólfsson, chairman of VR
Sólveig Anna Jónsdóttir, chairman of Efling stéttarfélag
Vilhjálmur Birgisson, chairman of Starfsgreinasamband Íslands