Equal pay is a must! Companies in Iceland can't pay women less than men

Iceland in June 2017 put the onus of mandating the 'Equal Pay Standards' on institutions rather the employee filing a complaining about gender discrimination.

Setting an example for the world to follow, this new year Iceland ensured that companies within its border do not discriminate amongst its employees based on gender. A law which was passed in June last year and came into effect on January 1, 2018, makes it mandatory for companies to demonstrate that they pay their males and female employees fairly.

Ranked number one in World Economic Forum’s Global Gender Gap Index, Iceland has championed the cause of women rights and had made it illegal to pay women and men differently on the basis of their gender in as early as 1963.

Iceland in June 2017 put the onus of mandating the ‘Equal Pay Standards’ on institutions instead of the employee filing a complaining about gender discrimination.

The system was in works since 2012 and in June last year the ‘Act on Equal Status and Equal Rights of Women and Men’ was amended making it mandatory for organization with 25 or more employees to get certified by a certification body confirming that the payroll system and its implementation comply with the requirements of the law.

Enterprises and institutions with 250 or more employees have to get certified by the end of 2018, with 150-249 employees have to get certified by the end of 2019, those with 90-149 employees by the end of 2020 and institutions employing 25-89 people will have to get certified no later than December 31 2021. The licenses will have to be renewed every 3 years, the law states.

The quantum of penalty has not been detailed but the law clearly states that the penalty for failing to comply with the law could amount up to ISK 50,000 per day.

The Equal Pay Standard, is a system developed by Icelandic trade unions, the employers’ confederation and government officials, as stated by the Icelandic Women's Rights Association. The association further states that “One of the main reasons women work fewer hours in Iceland than men, is that women are performing unpaid labor in the home and for the family. We at the Icelandic Women’s Rights Association believe that we need to look to the larger unadjusted figure to measure the gender pay gap, not the lower figure adjusted for working hours. Women in Iceland have walked out of their jobs five times in the last 42 years to protest the gender pay gap.”

The current coalition government in its ‘Agreement’ for coalition had affirmed its commitment to equal pay certification stating that “Deliberate steps will be taken to eradicate gender-based wage discrimination. For this purpose, it will be necessary, amongst other things, to publicise the gender pay-gap more prominently, e.g. in companies’ annual financial statements. It must be ensured that comparable jobs are evaluated in a comparable manner, in accordance with the demands that are made of enterprises according to law and that are supposed to be reflected in the new Equal Pay Standard.”