Civil servants to benefit first in Icelandic equal pay reforms

By on 17/01/2018 | Updated on 25/09/2020
The Althing, Iceland's parliament, the first country in the world to make it illegal for men to earn more than women working in equivalent jobs.

Government ministries and agencies are set to be among the first wave of organisations implementing Iceland’s new legislation mandating equal pay for women.

The Nordic nation is the first country in the world to make it illegal for men to earn more than women working in equivalent jobs. The legislation, which was passed by Iceland’s parliament, the Althing, in June 2017, came into effect on 1 January.

Under the new law, all companies and organisations with 25 or more employees are required to obtain a certificate every year showing that they meet the country’s new Equal Pay Standard (EPS), which was jointly drafted by trade unions, employers and government.

First wave

Deadlines for different types of organisation to achieve the EPS have been set for the next four years, after former prime minister Bjarni Benediktsson declared on International Women’s Day last year that Iceland planned to eliminate the gender pay gap by 2022. The country has since elected its second female prime minister, Katrín Jakobsdóttir, who took office in November.

All state ministries have to complete the certification process by 31 December this year, along with companies that have upwards of 250 employees. State institutions and state-owned companies with 25 or more staff must obtain a certificate by the end of 2019.

Private companies that employ between 150 and 249 people also have to complete the process by 31 December 2019, while medium-sized firms have until the end of 2020 and small firms until 31 December 2021.

New tools

“I think that now people are starting to realise that this is a systemic problem that we have to tackle with new methods,” said Dagny Osk Aradottir Pind, of the Icelandic Women’s Rights Association, as reported by the BBC.

“Women have been talking about this for decades, and I really feel that we have managed to raise awareness, and we have managed to get to the point that people realise that the legislation we have had in place is not working, and we need to do something more.”

The legislation “is a mechanism to ensure women and men are being paid equally” that makes companies “evaluate every job that’s being done” and results in certification “if they are paying men and women equally”, she told Al Jazeera.

Katrín Jakobsdóttir, President of Iceland. The country’s second female president (Image courtesy: NordForsk).

Mixed metrics

For the past nine years, Iceland has taken the top spot in the Global Gender Gap Index compiled by the World Economic Forum, which benchmarks 144 countries on progress towards gender parity. The index is based on four datasets, which measure gender equality in the fields of economic participation and opportunity; educational attainment; health and survival; and political empowerment.

On this metric, in 2017 women in Iceland were 88% of the way to full equality with men – up by 10 percentage points on 2006, which makes it one of the world’s most rapidly improving countries.

However, it dropped out of the global top 10 for economic participation and opportunity to 14th place, despite an improved score in a survey on wage equality for similar work, with women paid at 81% of male pay rates.

A small decline in women’s participation rates among legislators, senior officials and managers was a factor in the country’s lower performance on the economic category, with nearly two men to every women occupying such jobs in 2017 and a global rank of 50.

These measures are likely to be keenly observed over coming years as the new legislation comes into force. Last November, the New Zealand government set a target of achieving equal pay for women in public service jobs by 2021. But Iceland is the first nation to use hard legislative tools demanding equal pay across the workforce.

About Liz Heron

Liz Heron is a journalist based in London. She worked on daily newspapers for more than 16 years as an education correspondent, section editor and general news reporter. She was Education Editor of the South China Morning Post in Hong Kong and has contributed to a wide range of British media including The Independent, The Guardian and the BBC.

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