What is unpaid parental leave?
Unpaid parental leave is a leave of absence taken from salaried work after the birth of a child, non-family adoption of a child or a child under the age of 8 is taken into permanent foster care.
A person taking unpaid parental leave may not receive payments from the Parental Leave Fund.
Who can take unpaid parental leave?
Parents who are employed in the Icelandic job market may take unpaid parental leave up to four months to care for their child.
The right to take unpaid parental leave becomes valid at birth.
In cases of non-family adoption or permanent foster care, the date the child enters the home determines when the right becomes valid, as confirmed by the child welfare committee or other committee qualified to make such determinations. If the parents plan to collect the child abroad, the unpaid leave may begin on the date of departure from Iceland, as long as the relevant authorities or institution has confirmed that the adoption may go forward.
The right to take unpaid parental leave ends once the child reaches the age of 8. If a parent has not used their right to take unpaid parental leave in part or in whole by the time the child reaches the age of 8, the right may still be reinstituted if the child is diagnosed with a severe or chronic illness or severe disability, provided the child has not yet reached the age of 18.
Each parent has a separate right to unpaid parental leave independent of one another. Their rights are not transferrable.
A person taking unpaid parental leave may not receive payments from the Parental Leave Fund.
Arranging Unpaid Parental Leave
A parent has the right to take their unpaid parental leave all at once.
A parent may also come to an agreement with their employer to arrange their unpaid parental leave in another way, e.g., taking their leave over several shorter periods of time or taking their leave as working only some percentage of full time.
Employers should make every effort to accommodate parents who intend to take unpaid parental leave.
Employees are not permitted to take unpaid parental leave longer than 4 months during a 12 month period, unless they have express permission from the employer.
Notice of Unpaid Parental Leave
An employee acquires the right to unpaid parental leave once they have worked an uninterrupted period of 6 months for the same employer. This applies to both temporary and permanent employees.
If an employee intends to take unpaid parental leave, they must notify their employer as soon as possible and no later than 6 weeks before the intended leave begins. Notice of unpaid parental leave should be made in writing and include the intended start date, length and other terms of the leave. The employer will annotate the notice with the date of receipt and provide the employer with a copy.
The employer will maintain a record of unpaid parental leave taken by employees so that employees may receive a document confirming the number of unpaid parental leave days taken if requested.
Postponement & Other Changes to a Planned Unpaid Parental Leave
If an employer cannot accommodate an employee's request for the terms of unpaid parental leave, the employer, after conferring with the employee, must propose alternative terms within a week of receiving the notice. This response must be presented in writing and include the reasons that the original terms cannot be accommodated and, in cases of postponement, how long a postponement is being proposed.
Postponements are allowed only under certain specific conditions in a company's or organization's operations that create the need for a postponement. For example, seasonal work, the lack of a qualified replacement, if an unusually large number of employees request leave at the same time or if the employee performs and key role in the company's or organization's senior management.
The employer is not permitted to postpone unpaid parental leave longer than six month from the originally proposed start date unless the employee has agreed to it.
It is also not permitted to postpone unpaid parental leave that follows immediately after paid parental leave or if the child has become sick to a point that the situation requires the parent's presence. Postponement is also not permitted after the employer has already approved the leave of absence or if the allotted week has passed without an answer to the employee's written notice of unpaid parental leave.
If the employer's postponement of the unpaid parental leave results in the employee not being able to finish their unpaid parental leave before the child reaches the age of 8, then the period allowed to take unpaid parental leave will be extended to the date that the child reaches the age of 9.
Retaining Accumulated Rights
The rights that the employee has already accumulated or is accumulating at the start date of the unpaid parental leave will remain unchanged until the end of the leave. When the leave comes to an end, those rights will still be valid, as well as any amendments that may have come into effect because of legislation or collective wage agreements.
Service provider
Directorate of Labor