Persons aged 16-70 years are entitled to unemployment benefits if and only if they have been working legally for at least 3 months in Iceland. The premium to the Unemployment Insurance Fund (tryggingagjald) is paid by your employer.

You may recieve unemployment benefits if you are:

• Unemployed

• Living in Iceland (having a residence permit or being a Nordic Citizen)

• Actively seeking job

• Capable of working and willing to take all general jobs

• Ready to accept a job anywhere in Iceland.

You can transfer your right to unemployment benefit from other EU/EEA countries (E-301/E-303 form).

Application for unemployment benefits

When you apply for unemployment benefit you must bring some or all of the following documents:

• A special document, a job attest/confirmation from former employer (vottorð vinnuveitanda) with exact dates of beginning and end of the job, full time or part time.

• A medical attest if you have reduced capability to work.

• A signature of parent if the applicant is aged 16-17.

• Documents of other payments from Social Security Institute [Tryggingastofnun ríkisins], pension fund etc.

• Tax card.

• Attests from schools you have attended in Iceland.

• Numbers of days at sea (for seamen only).

Self-employed persons

Persons who have been self-employed or have been working for their own public limited company (ehf.), must bring the following documents from the tax authorities:

• A confirmation that own business has been stopped.

• A confirmation of own wages/salaries.

• A confirmation that employer’s contribution (tryggingagjald) and income taxes have been paid.

Jobseekers communications with the Public Employment Service (Vinnumiðlun)

• Every jobseeker will get an interview with a personal advisor as soon as possible.

• The jobseeker needs to be in regular contacts with the Public Employment Service (Vinnumiðlun) according to further instructions.

• Jobseekers must inform the Public Employment Service if they get a job, their capability for work is reduced, they decide to stop looking for a job and other significant changes.

Right to benefits

• The right to benefits depends of your employment, full time or part time, during the last 12 months (only legal jobs count, where the employer has paid employers´contribution, not “black” jobs).

• Basic rate of unemployment benefit is for 5,123 kr. per day or 111,015 kr. per month. If you have been in part time job you will get the same percentage.

• Income-based Benefits: Unemployment benefits are based on your income from your job for three months. It will be 70% of the average of total wages/salaries of six months starting two months before the application for benefits. The maximum is 185,400 kr. per month if you have full unemployment insurance cover.

• The minimum right to benefits: At least 25% job for 3 months. The minimum entitles you to ¼ of the basic rate.

• A jobseeker who has got the minimum right to benefits can if he has finished within the 12 months a study at school in Iceland lasting at least 6 months can get the study accredited as a 13 weeks employment (eg. 25% + 25% = 50%).

• Your can “freeze” your rights to unemployment benefits for 24 months if you decide to stop looking for a job for up to 24 months. (It means that you can stop seeking jobs, without benefits, for 24 months and then start job seeking with benefits). Students can “freeze” their rights for 36 months.

• Jobseekers with children (0-17 years-old) living in Iceland get extra payments for each child.

• Unemployment benefits are not paid in jobseekers sickness periods.

• The maximum percentage of unemployment benefit can not be higher than the percentage of full job the jobseeker is willing to take (If you are looking for part time employment, your unemployment benefit will be the same percentage).

Part time or casual jobs

 • The jobseeker must inform the Employment Service (Vinnumiðlun) if he gets permanent or temporary job.

• Jobseeker with right to benefits in partial employment seeking full time employment must declare his income and show his pay slips every month.

• Casual work must be declared.

• Income less than 52,000 kr. per month will not affect the unemployment benefit, but you must declare it.

Payments from the Social Security Institute, pension funds and capital income – Job seekers receiving payments from SSI, pension funds etc. must show their payment statements every month. Job seekers must inform the Employment Service about capital income.

Maximum period of unemployment benefits – You may receive unemployment benefits for 3 years. New period of unemployment benefits can not start until 24 months after the end of the first 3 years period. For getting the right to benefits again you must have worked at least 6 months during the 24 months waiting time.

You are not entitled to unemployment benefit if you are:

• Self-employed paying employers contribution (tryggingagjald) and income tax PAYE (Pay as you earn or staðgreiðsla) only once a year.

• When you are on vacation payment from your last employer (maximum 24 working days after you quit).

• If you get paid, eg. 3 months salary when you stop working.

• If you are studying at an educational institution 75% of full term study.

• If you are receiving “per diem” sickness or occupational accident benefits.

• If you are receiving payments for maternity/paternity leave.

• If you are receiving payments for long term illness of children.

• Strike and lock-out periods.

• Prison or community service.

Loss of benefits

• If you decline a job that the Employment Service is offering you. It will result in loss of benefits for 40 working days.

• If you refuse to follow a job seeking plan, attend courses and other labour market measures that the Employment Service is offering you.

• If you quit a job without a valid reason or lose a job due to you own fault you lose the benefits for 40 working days.

• If you drop out of school without a valid reason you will have to wait 40 working days before you are entitled to benefits.

• If you lose the right to benefits twice you will have to wait 60 working days.

• If you lose the right to benefits three times you need to work 8 weeks in Iceland to be entitled to benefits again.

If you try to get benefits by giving deliberately wrong information or by concealing information concerning your circumstances you will lose your rights to benefits.

Decision of unemployment benefits

The Directorate of Labour (Vinnumalastofnun) decides your right and loss of right to unemployment benefits. The decisions of Vinnumalastofnun can be appealed to a special committee for Unemployment Insurance.

www.vinnumalastofnun.is
Phone:               515 4850       
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