Directorate of Labour
The Supreme Court’s judgment on non-domestic employment income in the reference period
29th February 2024
On 28 February, a court ruling was made in case 24/2023 in which the question was whether the law on parental leave violated a obligation under the EEA Agreement.
In the case that the plaintiff brought against the Icelandic state, the claimant demanded that the ruling of the Welfare Committee, which confirmed the conclusion of the Maternity Leave Fund on calculating payments in maternity leave, be cancelled.
The policy holder had been living and working in another EEA country during a twelve-month reference period which ended six months before the month of birth of the child. As she had not earned income on the domestic labour market during the reference period she was paid minimum payments in accordance with the law on parental leave.
The Supreme Court concluded that the Maternity and Child Leave Fund could not have ignored the clear and explicit instructions of the law on parental and child-child leave when deciding on calculating payments from the Fund.
The facts that were discussed in the judgment were in the past of the previous law on parental leave no. 95/2000. In the current law no. 144/2020 the provisions that were tried in the case are unchanged.
The judgment sets a precedent when it comes to calculating the payments to parents who have not worked on the domestic labour market during the reference period.
The full sentence can be read here: