Trade unions on the Icelandic labour market work to improve wages and other employment conditions of their members, primarily by representing them in collective bargaining with employers and their federations and promoting their rights in the socio-economic field. The Act on Trade Unions and Industrial Disputes No. 80/1938 establishes the right of workers to form trade unions and federations of trade unions for the purpose of working jointly for the interests of the working class and workers in general. Trade unions are according to this Act made legal contracting parties concerning wages and terms of employment for their members. The constituency of a trade union can according to Act No. 80/1938 never be smaller than one municipality. The district can cover more than one municipality and for some trade unions the constituency is extended to the whole country.
Membership of Trade Unions
Trade unions are open to all those working in the trade concerned within the district of each union in accordance with further fixed rules contained in their statutes. Applicants may not be denied membership based on gender, national origin or other similar grounds. Union density is very high in Iceland compared to most countries, or around 85%. Trade unions are affiliated to national federations which are affiliated to the Icelandic Confederation of Labour (ASI).