New legislation in Iceland requires organisations of more than 25 people to seek government certification of their equal pay policies.
Legislators in Iceland have made it a requirement for organisations to prove they are not discriminating against women in employee compensation, as part of a larger strategy to close the gender wage gap in the country.
The new law, which came into effect on the first day of 2018, requires organisations of 25 people or more to apply to the government for certification of equal pay policies. Failure to prove that women and men are being compensated fairly will result in fines of up to 50,000 Icelandic krona (€400) per day.
Deadlines for organisations to meet the legal requirements are staggered over the next three years.
Larger organisations with more than 250 people will have until 31 December 2018 to implement the equal pay standard, while companies with 150 to 249 people will have until 31 December 2019. The latest possible deadline for the smallest organisations (25-89) is the last day of 2021.
All state organisations, however, will have to implement equal compensation policies before 2020.
Speaking to Al Jazeera, Dagny Osk Aradottir Pind, a board member of the Icelandic Women’s Rights Association, said: “The legislation is basically a mechanism that companies and organisations … evaluate every job that’s being done, and then they get a certification after they confirm the process if they are paying men and women equally.”
The Icelandic parliament first announced the amendment to Article 19 of its Act on Equal Status and Equal Rights of Women and Men in June 2017.
The act is one of a large collection of equal pay legislation that the island nation has brought in to combat gender gaps, the first of which was passed in 1961.
Iceland has long been the darling of the World Economic Forum’s Global Gender Gap report, having been ranked the most gender-equal country in the world for the past nine years.
The aforementioned report examines gender equality under the rubrics of economics, health and survival, education, and politics. Since the report was first published in 2006, Iceland has closed almost 10pc of its gender gap, making it one of the fastest-improving countries in the index.
Most countries have an act that criminalises sexual discrimination in compensation; however, Iceland’s call for transparency in even some of the smallest organisations makes it somewhat unique.
Time to follow suit
This legislation is some of the most far-reaching on record and, while it should be emulated worldwide, one wonders how the issue of gender gaps within small start-ups will ever be addressed.
Women are also still consistently observed as doing the lion’s share of household work – a stubborn and insidious legacy from the days in which women were not allowed to work outside of the home and men were the sole breadwinners of the house.
Despite the fact that women entered the workforce in large numbers in the latter half of the 20th century, gender parity has not yet been achieved, and failure to address this could potentially hinder gender equality in the workplace.
In 2017, it was announced in the UK that organisations of 250 or more will have to disclose gender pay gaps; however, some are not optimistic about the likelihood of eligible organisations publishing the relevant data before the April 2018 deadline.
Also last year, we reported on findings by Computer Weekly, which revealed that, on average, women earn 25pc less than their male counterparts regardless of role or experience. In certain roles, women can expect to earn less than half of a man’s salary.
Protests in Iceland calling for more rights for women. Image: Petur Asgeirsson/Shutterstock