Tourism industry campaign, Iceland
The Icelandic Travel Industry Association and the Icelandic Tourist Board undertook a research project in 2011 to assess the scale of unlicensed businesses within the hotel and tourist industry. The aim of the project was to raise awareness and trigger changes in attitudes towards working on an undeclared basis.
For many years, the Icelandic Travel Industry Association and the Icelandic Tourist Board have been fighting against unlicensed businesses within the tourist and hotel industry. This is an important matter for the whole tourist sector as well as the Icelandic economy, as unlicensed and undeclared work in this industry has proven to be difficult to control and regulate. As a result of this, competition in the industry has been very unfair.
The objective of this research was to raise awareness and prompt changes in attitudes towards working on an undeclared basis. The final report showed that unlicensed entities within the hotel industry represented 15.3% of hotels in the metropolitan area around Reykjavik, the capital of Iceland. The proportion of unlicensed hotels in other parts of the country is even higher, but exact figures are currently not available.
The objective of the research and the campaigns outlined below was to raise awareness within the industry and among government officials that there is a serious need to formalise the industry; realistic and effective policy measures are needed to formalise unlicensed businesses. A by-product would be that undeclared work would move into the declared realm. Last but not least, it is just as important to create a fairer competitive industry environment.
No specific policy measures have been adopted. Neither has the official legal framework been improved to tackle unlicensed and undeclared work in this industry.
In the summers of 2011 and 2012, the Icelandic Travel Industry Association and the Icelandic Tourist Board hired an employee to seek out unlicensed businesses. The objectives were to a) get unlicensed businesses to become legal, b) stop illegal operations, and c) get rid of undeclared work in the industry. A desk-based approach was taken, whereby businesses were detected though their websites, and then checked against official records. The introduction of workplace ID cards was an initiative of the Icelandic Confederation of Labour and the Confederation of Icelandic Employers. Hotels and restaurant fall under the ID Card Act. All employers within the industry are obliged to ensure that their employees get workplace ID cards when they begin working. Inspectorate units have been formed with the role of visiting worksites to check on workplace IDs; these units have been active in taking action against undeclared work.
Lessons and conclusions
Achievement of objectives
The initiative taken in the industry in 2011 and 2012, of hiring an employee to seek out unlicensed businesses, has proven successful in transferring businesses into the declared realm. Currently no statistics are available on the results. The Icelandic Travel Industry Association and the Icelandic Tourist Board were quite satisfied with the results of this initiative.
ID card inspectorate units also delivered positive results in transferring businesses into the declared realm. Currently no statistics have been published showing the results, but this should be possible in the future, as the inspectors document their work in real time into a central database.
As activities are difficult to regulate through deterrence in this industry, informative campaigns such as the one described above should be useful in all countries with a large tourism industry.
The Icelandic Tourist Board