If an employee becomes ill or has an accident while working in Iceland in connection with the provision of services, they are entitled to pay during their absence due to the illness or accident.

Accrual of entitlement to sick pay

An employee accrues entitlement to sick pay through employment with the same undertaking in Iceland.

During the first twelve months, the employee accrues entitlement to two days of paid sick leave for each month worked.

The entitlement is based on the pay provided for in the collective agreement applicable to the relevant sector and takes account of the employee’s working hours, i.e. whether the employee works full-time or part-time.

Entitlement to sick pay is a cumulative entitlement based on the total number of days of sickness during each twelve-month period, irrespective of the nature of the illness.

After one year of employment

Once an employee has worked in Iceland for more than one year, entitlement accrues in accordance with Article 5 of the Act on Workers’ Rights in the Event of Termination of Employment and to Wages in the Event of Illness and Accidents.

Employees’ rights to notice of termination and to pay in the event of illness or an accident must be respected.

Occupational accidents and occupational diseases

If an employee is unable to work due to the consequences of an accident at work or an accident occurring while travelling directly to or from work, they are entitled to pay in accordance with the applicable collective agreement for up to three months, based on their working hours. This entitlement is in addition to their entitlement to sick pay.

The same applies if an employee develops an occupational disease.

As above, pay is based on the collective agreement applicable to the relevant sector and the employee’s working hours.

Pay under collective agreements

Pay under collective agreements means the pay stipulated in the collective agreement applicable to the relevant sector in the geographical area covered by the agreement.

Payments from the home country

If an employee receives pay in the event of illness or an accident under an employment contract, collective agreement or the legislation of their home country, they must be paid the difference if their entitlement under Icelandic rules is more favourable.

Medical certificate

The undertaking may request a medical certificate confirming that the employee is unfit for work due to illness or an accident.

The undertaking must cover:

• The cost of the medical certificate.

• Any costs associated with obtaining it.

This applies if the employee reported the illness on the first day.

More favourable entitlement applies

If an employee has more favourable rights under their employment contract with the undertaking concerned, an applicable collective agreement or the legislation of their home country, the more favourable rights apply.