Parental Leave in Iceland
Reviewed by the Commoner Law Editorial Team. Sourced from Icelandic Acts of the Althingi, statutory instruments, and official guidance. Written in plain language for general understanding — this is educational content, not legal advice. Our editorial standards
What is this right?
Iceland offers one of the most generous parental leave systems in the world. Since the 2021 reform under Act No. 144/2020:
- Total leave: 12 months per family.
- Each parent: Independent entitlement to 6 months.
- Transferable: Either parent may transfer up to 6 weeks of their entitlement to the other parent.
- Non-transferable minimum: Each parent retains at least approximately 4.5 months that cannot be transferred (use-it-or-lose-it).
- Deadline: Leave must be used before the child reaches 24 months of age.
Payment: 80% of average total salary, capped at ISK 900,000/month for 2026 (ISK 800,000 in 2025), set by the March 2024 tripartite agreement and confirmed at island.is. The 80% is calculated on average earnings over the 12-month reference window ending 6 months before the birth, so in practice the ISK 900,000 cap only binds for parents earning roughly ISK 1,125,000/month or more in that window. A minimum flat-rate payment is available for parents outside the labour market.
When does it apply?
- You are a parent (biological or adoptive) who has been active on the Icelandic labour market for at least 6 months before the birth or adoption.
- Both mothers and fathers have independent, equal rights to leave.
- Parents outside the labour market receive a minimum flat-rate payment.
What to Do If Your Employer Is Denying or Penalising You for Taking Parental Leave in Iceland
- Apply to the Maternity/Paternity Leave Fund (Fæðingarorlofssjóður) through the island.is portal.
- Give your employer at least 6 weeks' notice before starting leave.
- You may take leave in one block or split it into periods with your employer's agreement.
What should you NOT do?
- Don't assume only mothers get leave — fathers have an equal, independent entitlement.
- Don't wait too long — unused leave expires when the child turns 24 months.
- Don't let your employer pressure you into not taking leave — you are protected from penalisation for exercising your parental leave rights.
Common Questions
How much parental leave do I get in Iceland?
Under Act No. 144/2020, each family gets 12 months total. Each parent has an independent entitlement to 6 months, with up to 6 weeks transferable to the other parent. At least roughly 4.5 months per parent is non-transferable — use it or lose it. Leave must be used before the child turns 24 months old.
How much does Iceland pay during parental leave?
The Maternity/Paternity Leave Fund (Fæðingarorlofssjóður) pays 80% of your average total salary, capped at ISK 900,000 per month in 2026 (up from ISK 800,000 in 2025) under the March 2024 tripartite agreement — confirmed on island.is. Parents outside the labour market receive a minimum flat-rate payment. You must have been active on the Icelandic labour market for at least 6 months before the birth or adoption to qualify for the salary-based benefit.
How do I apply for parental leave in Iceland?
Apply to the Maternity/Paternity Leave Fund (Fæðingarorlofssjóður) through the island.is portal. Give your employer at least 6 weeks' notice before starting leave. You may take leave in one block or split it into periods with your employer's agreement. You are protected from penalisation for exercising your parental leave rights.
When does it apply — parental leave?
You are a parent (biological or adoptive) who has been active on the Icelandic labour market for at least 6 months before the birth or adoption.Both mothers and fathers have independent, equal rights to leave.Parents outside the labour market receive a minimum flat-rate payment.
What should I do if my employer is pressuring me not to take parental leave in Iceland?
Apply to the Maternity/Paternity Leave Fund (Fæðingarorlofssjóður) through the island.is portal.Give your employer at least 6 weeks' notice before starting leave.You may take leave in one block or split it into periods with your employer's agreement.
What should you NOT do — parental leave?
Don't assume only mothers get leave — fathers have an equal, independent entitlement.Don't wait too long — unused leave expires when the child turns 24 months.Don't let your employer pressure you into not taking leave — you are protected from penalisation for exercising your parental leave rights.