From Iceland — Labour, Management and Government: Confident Deal Will Be Reached

Labour, Management and Government: Confident Deal Will Be Reached

Published June 25, 2009

After a meeting between representatives of labour unions, management and government authorities last night, all parties expressed confidence that a final agreement will be reached today.
As it is, the tentative arrangement is a 13,500 ISK general raise in salaries that was to go into effect on 1 July will instead be cut in two – 6,750 ISK on 1 July, and 6,750 ISK on 1 November. A 3.5% inflation adjustment will be delayed until 1 November as well. Furthermore, a 6,500 ISK pay raise planned for January 2010 will be pushed back to June 2010, where then a 2.5% inflation adjustment will be made as well.
However, labour and management had expressed displeasure with the government’s plan for 2011-2013, and asked that instead of raising taxes, that more budget cuts be made. According to Morgunblaðið, government authorities apparently came to the table yesterday evening with a new deal, which labour, for one, was pleased with. Whether this means taxes will not be raised, will not be raised as much as was intended, or that labour and management accepted the tax raise remains to be seen.

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