Direct Request (CEACR) - adopted 2020, published 109th ILC session (2021)

Employment Policy Convention, 1964 (No. 122) - Iceland (Ratification: 1990)

Other comments on C122

Observation

Direct Request

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COVID-19 pandemic. Response and recovery measures. The Committee notes the extensive response measures taken by the Government to mitigate the effects of the COVID-19 pandemic. The broad-based measures are intended primarily to prevent unemployment and temporary loss of personal income through a Government payment of up to 75 per cent of the salary of part-time workers to encourage businesses to keep employees and avoid job losses. The measures also provide for the possibility of postponing the payment of taxes for businesses experiencing temporary difficulties as well as the possibility of withdrawing a monthly sum from voluntary pension savings. The Committee further notes the conclusion on 5 March 2020 of a three-party agreement on action to counter COVID-19 between the Government, the SA Confederation of Icelandic Enterprise, and the Icelandic Confederation of Labour. The parties agreed to recommend that: enterprises continue paying wages to those employees who have been quarantined by the health authorities and that workers’ organizations will ensure that persons with membership in their sick leave funds who fall ill receive full payment from the fund if their sick leave entitlements through employment have been exhausted. In addition, the agreement contemplates the adoption of measures to introduce amendments to the Health Insurance Act in order to allow businesses paying the salaries of employees who have been quarantined to claim reimbursement of these costs from the Icelandic Health Insurance Fund up to a specified limit and under certain circumstances. In this context, the Committee recalls the comprehensive guidance provided by international labour standards and draws the Government’s attention to the Employment and Decent Work for Peace and Resilience Recommendation, 2017 (No. 205), which provides guidelines for developing and implementing effective, consensus-based and inclusive responses to the profound socio-economic impacts of the pandemic. The Committee invites the Government to provide updated information in its next report on the impacts of the global COVID-19 pandemic on the application of the Convention and the nature and outcomes of measures taken to mitigate these impacts.

Articles 1 and 2 of the Convention. Employment trends and active labour market measures. The Committee welcomes the Government’s report, prepared in consultation with the Icelandic Tripartite ILO Committee, which contains updated statistical information, indicating that the employment situation continued to improve during the reporting period. According to Statistics Iceland, the overall employment rate in 2018 was 81.6 per cent. The overall unemployment rate was 3.3 per cent in 2018, although it began to rise again in 2019. The Government indicates that one of its policy priorities is promoting a diversified economy that is prepared for the challenges and opportunities brought by the rapid evolution of technology. The Government envisages the establishment of a National Fund to manage the profits generated by the country’s natural resources, including energy resources that will be used to promote technological innovation and support the growth and development of start-up companies to create new, well-paid jobs in the future. Moreover, the Government indicates that the Directorate of Labour provides counselling services to jobseekers, vocational training and workshops. The Directorate also provides special grants to support women-led businesses and for the payment of educational fees. The Government indicates that one of the key objectives of the labour market measures implemented is to get long-term unemployed people into work. The main measures entail providing additional vocational and employment-related remedies for long-term unemployed persons in collaboration with the business sector and educational institutions based on needs analyses of the job market. The Government also refers to the launching in 2018 of a regional development policy for the period 2018-24, whose principal objectives include addressing the population decline in certain regions, resolving issues arising from over-dependence on a narrow range of occupational sectors, as well as meeting the challenges posed by technological changes. The Committee further notes the statistical information provided by the Government concerning the persons registered to participate in employment-related measures. The Government reports that between 2015 and 2018, approximately 83 per cent of those who participated in active labour market measures were no longer registered as unemployed three months after the completion of the programmes. The Committee requests the Government to continue to provide information, including statistics, disaggregated by age and sex, on the impact of the active labour market measures taken to promote employment through the implementation of a coordinated employment policy and programmes. It also requests the Government to continue to provide information on the nature and the impact of the employment measures taken or envisaged targeting the long-term unemployed as well as the other specific target groups identified by the Government.

Youth employment. The Government reports that it is placing priority on developing and extending services for young persons in vulnerable situations, reducing the number of young unemployed persons remaining on the unemployment register for longer than 6 months and the number of job-seekers aged 18-29 who remain on the register for more than 12 months. These efforts seek to prevent youth from dropping out of the labour market or other forms of activity and to improve their employability. The Directorate of Labour has adopted an interdisciplinary approach which promotes the relation between the social, employment and health services and the school system. It launched an experimental project for the period 2017 to 2020 to improve the situation of young persons aged 16 to 29 who have not completed any formal education after completion of compulsory schooling and who are considered at risk of becoming chronically inactive in the labour market. In addition, the “Job forum” (Atvinnutorg) project, launched at the end of 2017, provides individual counselling services to job-seekers, and benefitted a significant number of young persons. The Government reports that recent university graduates represent a high proportion of the unemployed (32 per cent among women and 20 per cent among men in the first half of 2019). The Directorate of Labour has adopted special measures to reduce unemployment among these young graduates, collaborating with institutions holding courses and workshops for the unemployed and promoting the creation of more employment opportunities for young graduates, in collaboration with enterprises and institutions. The Committee requests the Government to continue to provide detailed information on the nature and extent of measures taken or envisaged to tackle youth unemployment, especially among recent university graduates, as well as information, including statistical data disaggregated by age and sex, on the impact of the measures on young persons’ access to lasting employment.

Workers in vulnerable situations. In reply to its previous comments, the Committee notes the information provided by the Government concerning the measures adopted with a view to ensuring that persons with disabilities are not discriminated on the job market and to developing supportive remedies. In this regard, the Government recalls that the Directorate of Labour provides specialized counselling for jobseekers, assisting individuals and monitoring their progress in the workplace through the “Employment with Support” (AMS) project. The Government also refers to the implementation by the Directorate of Labour of a one-year project in 2016 through a grant from the Ministry of Social Affairs, aimed at expanding employment opportunities for persons with disabilities who were about to complete their formal education at school or at the University. The Government indicates that, in view of the positive results achieved by the project, the Directorate of Labour plans to further develop the project to enhance the understanding of the importance of ensuring equal opportunities for persons with disabilities in the labour market. The Committee notes, however, that the Government has not provided information on the specific measures adopted or envisaged to promote employment for persons with mental or psychiatric disabilities. The Committee requests the Government to continue to provide detailed updated information on the nature and impact of the measures adopted to promote the access to the labour market for persons with disabilities and other jobseekers with diminished working capacity, including information on measures to promote employment for persons with mental or intellectual disabilities.

Recruitment of foreign workers. The Committee notes the information provided by the Government concerning the expansion of employment support measures to address the high unemployment rates among foreign workers, which according to the Government have continued to increase in the period 2017-2019. The Government refers in particular to the expansion of language-interpreting services and language courses, and to an increase in the number of vocational training opportunities open to foreign jobseekers in order to enhance their employability and give them more opportunities to learn Icelandic. The Committee requests the Government to continue to provide updated detailed information on the nature and the impact of the measures taken to support the access of foreign workers to the Icelandic labour market and reduce unemployment among this particular category of workers.

Business development. In reply to its previous comments, the Committee notes the information provided by the Government regarding the impact of business development measures on employment creation and decent work. The Government indicates that, according to a survey conducted in 2017, 75 per cent of enterprises that received a grant between 2011 and 2016 under the Women’s Employment scheme were still in business. The Government adds that in 2019, 29 projects received grants under the scheme, totalling ISK40 million. Moreover, the Government indicates that the Credit Guarantee Fund ceased its operations in 2018. According to a survey carried out among its beneficiaries, loans and guarantees made by the Credit Guarantee Fund had played a crucial role in the running of the respondents’ enterprises, which increased their turnover volume and number of employees. The Government adds, however, that in view of the low response rate in the survey, it is difficult to base definite conclusions on these findings. The Committee notes, however, that the Government does not provide information on the status of the review of the regulatory framework of the business sector. The Committee requests the Government to continue to provide information, including disaggregated statistics on the impact of the measures taken with the aim of ensuring an enabling business environment conducive to job creation and decent work. The Committee reiterates its request that the Government provide information on the status of the review of the regulatory framework of the business sector in Iceland.