Last updated on April 6, 2026.

Paid Time Off (PTO) in Iceland

Vacation (Annual Leave) Quota

24 days

Workers in Iceland are entitled to 24 days of paid vacation per year (4 weeks + 4 days). Some workers may be entitled to more vacation days if they have a collective agreement, typically 25–30 days.

The law mandates a monthly accrual of 2 days of vacation during the accrual year, which lasts from May 1 to April 30. Most workers use their vacation during the time period from May 2 to September 1.

This vacation policy is among most generous in the Europe.

Payout

A vacation allowance is required by law.

Workers get a vacation (holiday) allowance, generally paid monthly or at the start of their leave either at the start of their vacation or monthly. Vacation pay is 10.17% of total wages. This amount might be higher according to certain collective bargaining agreements.

Payment of Unused Vacation on Termination

Required by law.

When an employee ends their employment at the company, the employer is required to pay their unused vacation allowance.

Sick Leave in Iceland

24 days per year

Sick leave entitlement is the same as vacation entitlement. Employees accrue 2 days of sick leave each month during their initial year of work. After a full year of employment, they are entitled to 2 months of paid sick leave per year. Sick leave enrollment increases with the years of service at the company. Upon reaching 5 years of employment, an employee is entitled to 4 months of sick leave per year, which increases to 6 months per year after 10 years.

Employees are required to present a medical certificate and inform their superiors about their sick leave as early as practible.

CBA may offer some employees extra days of leave. Some CBAs can also provide employees with paid sick leave when their children under the age of 13 are sick.

Payout

The initial two days of each monthly accrual are compensated at full salary by the employer. Above these two days, the compensation rate and duration of sick leave are determined by the employee’s chosen trade union.

Additionally, employees who lose their salary because of sick leave might qualify for help from social security.

Maternity and Paternity Leave in Iceland

12 months in total for both parents.

Parents who are employed, when their child is born or adopted, are entitled to 12 months of paid leave, which is maternity and paternity leave combined. This leave is available to all employees, both in the public and private sectors, as well as self-employed employees.

Each of the parents is entitled to a minimum of 5 months of leave. On top of that, they also receive 2 more months of leave, which can be used equally or taken only by one parent. This means that one parent may have 7 months of maternity leave and the other 5 months of paternity leave, or they can both have 6 months. This leave is to be taken within the first 18 months of the newborn.

These conditions make Iceland have one of the best paternity leave among the world’s leave laws.

Payout

Maternity and paternity leave in Iceland is paid by the government (social security system) at a rate of 80% of the employee’s salary. This amount is capped at ISK 600,000–900,000+ monthly depending on the year, and is 800,000 ISK for childern born in 2025, and 900,000 ISK for 2026. A minimum monthly payment of ISK 262,061 to an employee in 50 – 100% employment.

Parents become eligible for paid maternity or paternity leave after 6 months of continuous employment.

Parental Leave in Iceland

13 weeks of unpaid leave

Employees are entitled to take advantage of unpaid parental leave, lasting up to 13 weeks, to take care of a child who is eight years old or younger.

Payout

Parental leave is unpaid.

Bereavement Leave in Iceland

General bereavement leave is not specified by Iceland leave law.

However, bereavement leave does apply on employees who are parents suffering the death of their child up to 18 years old. The Act on Bereavement Leave took effect on January 1st, 2023, and applies to parents who lose their child on January 1 and thereafter.

Payout

Employees on bereavement leave shall receive 80% of the average total salary.

Capped at: ISK 800,000–900,000, depending on a year.

Minimum: ISK 232,061 per month to an employee working 50 – 100%.

Jury Duty Leave in Iceland

Required by law.

Employers in Iceland are legally required to grant time off for jury duty. Employees must inform their manager as soon as practicable after receiving the summons letter. However, online data is unavailable whether this leave is paid or unpaid. Still, employees can claim expenses back from the courts for transport, meals for long days, etc.

Military Leave in Iceland

Military leave is not specified by law. Iceland is one of the very few countries in the world with no military.

Voting Leave in Iceland

Online data is unavailable; please check official legal materials or offline sources for information. Voting leave is most likely not specified by law.

Public Holidays in Iceland

15 days of public holidays

Iceland recognizes 10 public holidays in a year and they last 15 days because some holidays provide a few successive days off:

• Easter: 3 days;

• Whit Sunday (Pentecost): 2 days;

• Christmas: 3 days.

A complete list of official holidays celebrated in Iceland:

Sources

1. Local Laws & Regulations, https://www.atlashxm.com/en/countries/iceland

2. Parental Leave, Government Site, https://island.is/en/parental-leave

3. Definitive Guide to Hiring in Iceland, https://www.globalexpansion.com/countrypedia/Iceland

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Check out our Leave Laws page to learn more about laws in various countries.