Reykjavík Grapevine - 16.06.2017, Page 13

workers aged 20 and up to 22 receive a
monthly salary of 262,532 ISK. Divided
by 160 hours for a full-time month, we
get an hourly wage of 1,640.825 ISK per
hour. Even if we round this up to 1,641
ISK per hour, this is still the equiva-
lent of $16.63 per hour (at a time when
the króna is particularly strong, mind
you), or at least over three dollars an
hour less than what Costco employees
make in the US.
Purchasing power
is also lower here
Employees aged 22 or older, those that
have special training, and those work-
ing for the company for six months
or more get paid more, but they still
d o n ’ t g e t t h e
equivalent of over
$20. In fact, work-
ers aged 18 or 19
only make 95% of
the starting full-
time wage, and a
Costco employee
i n Icela nd who
receives special
training and stays
with the company
for five years will
still not achieve
the equivalent of
over $20 per hour.
Of course, wages aren’t the only
thing that matters; what you can get
for your money does, and that’s where
cost of living comes into play. As it
turns out, by 2017 figures, Iceland has
the third highest cost of living in the
world; the United States, by contrast,
is 18th. This effectively means that
even if Icelandic Costco employees
were being paid the króna equivalent
of $20 per hour, they would still get far
less for that money than an American
Costco employee would.
And this is without even touching
the tax question: Americans tend to
pay a lower percentage of their income
into taxes than Icelanders do.
Rewarding long service
Companies can, but very rarely do,
pay their workers more than what the
collective bargaining agreement es-
tablishes. So we reached out to three
separate people representing Costco
management in Iceland for comment.
Brett Vigelskas, the warehouse di-
rector for Costco in Iceland, told us
that in fact the company goes beyond
what they are legally required to pay.
“It is not our practice to disclose
specific pay information beyond what
is required by the financial reporting
authority. However we pay above the
CBA minimum by at least 10% and this
percentage can be higher based on ex-
perience,” Brett told us by e-mail. “We
reward long service with increased
summer and Christmas bonuses after
five years. In addition we offer Opti-
cal vouchers for employees with more
than twelve months service to be uti-
lized in our warehouse Optical depart-
ment. The company ethos has always
been to hire good people, pay them
good wages, give them good jobs or
careers and good things will happen!”
As such, the management of a pri-
vate company is actually paying its
employees more than what the labour
unions representing Icelanders re-
quires of them.
Our spineless unions
It bears emphasising here that we are
currently in the midst of a “worker’s
market.” Unemployment in the first
quarter of 2017 was at 2.9%, accord-
ing to Statistics Iceland, and has been
below 5% for at least the past two years
now. This should put unions at a dis-
tinct negotiating advantage: a small-
er pool of available workers means
unions can and ought to be making
greater wage demands.
Instead, workers from unions
ranging from seamen to teachers to
healthcare workers have consistently
criticised their unions over the past
couple of years for not fighting harder
for higher wages. On top of this, many
of the bosses of Iceland’s major unions
pull in a salary going beyond 1 million
ISK per month—VR is actually the ex-
ception here, as their new director Rag-
nar Þór Ingólfsson asked for a pay cut,
a request that made headlines in itself.
In fact, the conventional wisdom
lately has been that our unions do
their best to please management,
rather than fight for their workers.
This situation has contributed to the
formation of the Socialist Party of Ice-
land, as well as increasing internal
struggles between labour unions and
their workers.
Perhaps Iceland’s labour unions
would do well to take a page from
Costco’s playbook. Just as the company
bargains for lower prices from their
suppliers, our unions could demand
higher wages, especially as they’re in a
position to do so, and “good things will
happen.”
“The conventional
wisdom lately
has been that our
unions do their
best to please
management,
rather than fight
for their workers”
An Icelander is sworn in at Costco
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