The primary role of unions is to negotiate wages and other terms of employment in collective agreements on behalf of their members and to look after their interests in the labour market issues.
Most unions operate funds that benefit members, such as sickness funds in case if illness, vacation funds and education funds. Unions also offer legal services to their members, e.g. in disputes with employers.
Although almost all employees in Iceland are union members, this is not mandatory. Persons who opt out still have to comply with the terms of statutory collective agreements and pay dues to the trade unions.
Most unions join forces with others in the same industrial sector or region of the country to form larger associations. These union associations belong to one of the four workers’ federations in Iceland: ASÍ, BSRB, BHM and KÍ. A fair number of unions also operate outside of these federations
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