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Please try again later. Learn more about Iceland’s efforts to reduce the gender pay gap and EPIC’s relevance to the country below. “The only thing we learned is that there are very narrow pay gaps between people performing the same job. Staff can be safe in the knowledge that nobody will see the boss and get a random rise without it benefiting them too. On Jan. 1, Iceland became the first country in the world to make it illegal to pay men more than women for doing the same job, an inequality that exists in almost every country. Iceland has been a member of The Equal Pay International Coalition (EPIC) since the launch at the UN General Assembly in September 2017. Aðalsteinn has heard that employees generally wonder whether the equal pay standard will threaten their freedom to negotiate their pay. But the system needs to be flexible enough to reward individual workers who do a good job. O n Jan. 1, Iceland became the first country in the world to make it illegal to pay men more than women for doing the same job, an inequality that exists in almost every country. Still, Iceland’s workforce is thought to be far more progressive on equal pay than that of the U.S., which recently ranked 28th on the WEF report that Iceland topped. The Nordic nation has pledged to eradicate the gender pay gap by 2022 The new Equal Pay Certification law took effect in Iceland at the beginning of this year. Sigurður Árnason has worked there for 11 years as a specialist. Byggðastofnun is based in Sauðárkrókur in North-Western Iceland. With the new law in effect, the Icelandic government hopes to close the gap entirely by 2022. A sceptical finance confederation. The Equal Pay Standard was written in cooperation between the labour movement, the employers‘ confederation and the Ministry of Labor and Finance in Iceland. Read an updated guide to equal pay in Iceland and the Equal Pay Standard here! No other country has gone as far as Iceland in demanding equal pay for equal work. “I think companies should be able to reward staff who show initiative and skills. To maintain gender equality and equal pay, you measure how much should be paid for different jobs. THE LAW. Although Iceland first passed legislation on equal pay as early as 1961, the gender pay gap persisted. In Iceland, such discrimination has been prohibited by law since 1961. That is why it was natural for Byggðastofnun to become one of the first public offices to introduce the equal pay standard in Iceland. The salary system is simple; all secretaries are paid the same, as are all specialists and all heads of departments. Aðalsteinn Þorsteinsson, Director General for Byggðastofnun. This might make it impossible to reward a good employee through a pay rise, or to pay a bonus to someone who shows initiative and works independently. By signing up you are agreeing to our, Iceland's Prime Minister Talks Climate Change and Gender Equality Over Ice Cream, Sign up to receive the top stories you need to know now on politics, health and more, © 2021 TIME USA, LLC. Anna Lea works at the Icelandic Regional Development Institute Byggðastofnun in Sauðárkrókur in Northern Iceland. The Chairman is one of them. As long as this is the case, a certain level of distrust will remain,” he says. In fact, we passed the first legislation mandating equal pay for men and women in Iceland over half a century ago, in 1961. The equal pay standard makes this impossible,” saysFriðbert. Iceland introduced an Equal Pay Standard in 2012, ÍST 85:2012 (Equal wage management system - Requirements and guidance). Iceland’s new equal pay legislation has been making international headlines. Employers will face fines if they are found to be in violation. Iceland is the first country to take the fight against the gender pay gap a step further, requiring companies to proactively get equal pay certification from the government. Companies are free to apply their own criteria and decide just how valuable jobs are. Wage disparity between men and women remains a global issue. ... but lack of political power and equal pay. An unexpected error has occurred with your sign up. A few years ago he had a small pay rise as a result of the equal pay standard. Over and above that, she says, is the European Union right to equal pay, which gives workers the right to go to civil court or a tribunal. If there are some faults in the system, you carry on developing the standard until it is perfect, he thinks. The newsletter is issued 9 times a year. Iceland is already one of the most progressive countries in the world in terms of equality. This landmark piece of legislation will make Iceland the first country in the world to truly enforce equal pay between women and men. International Women's Day 2017: Iceland becomes first country in the world to make firms prove equal pay. On Monday, it became the first country in the world to legalize equal pay, Al Jazeera reports. Iceland has become the first country in the world to force companies to prove they pay all employees the same. Under the new law, companies and government agencies that employ at least 25 people will be fined if they can’t prove they pay men and women equally. Aðalsteinn Þorsteinsson, the Director General for Byggðastofnun, explains that regions become vulnerable and that there is a risk of more social problems if there is an imbalance between the genders. Like Iceland, the U.S. has laws in place – such as the Equal Pay Act of 1963 and Title VII of the Civil Rights Act of 1964 – outlawing pay disparity on paper, but currently no such laws are quite as rigorous in practice. In 2015, women earned 14-20% less than men, according to Statistics Iceland. The Central Bank’s policy is that all employees shall be paid equal wages and enjoy equal terms of employment and rights for the same jobs or jobs of equal value, so that there is no gender-based pay gap within the Bank. Please attempt to sign up again. Critics say the standard limits people’s chances to get pay rises or bonuses. Iceland has become the first country in the world to enforce equal pay between men and women. Iceland’s equal pay standard – the employer’s best weapon? READ MORE: Iceland to become first country to make companies prove they offer equal pay The bill was tabled and passed last spring, but only took effect on New Year’s Day. They stared back in 2012, and quickly realised that introducing the standard would be a quick job; there were hardly any pay differences between the genders at all within the organisation. He wonders whether the equal pay standard in fact benefits employers. Companies and state organisations that have been certified must be able to show there is no more than 3 % differences in wages. Yet all surveys have so far shown the same number – a difference of 10-15 %. Iceland PM on equal pay: It doesn't just happen by sitting and waiting. Anna Lea wants to know whether the equal pay standard makes it impossible for individual workers to secure a pay rise after getting further education for instance, or whether one workers’ pay rise automatically leads to other workers on the same wage level getting the same rise. The small island nation has been ranked as the globe’s most gender-equal country by the World Economic Forum for nine years in a row. wonders Friðbert, and points out that when companies decide on how different roles should be rewarded, they might create an imbalance. Iceland’s equal pay standard – the employer’s best weapon? Equal pay certification under the Standard ÍST 85 is designed to confirm that when decisions on wage are taken they are based only on relevant consideration. Friðbert also believes the equal pay … Iceland has become the first country in the world to force companies to prove they pay all employees the same. Right now, Iceland’s largest businesses are introducing the equal pay standard. The town is best known among Icelanders for the country's sole remaining cooperative shop. The most difficult task was to classify the different roles, and to establish rankings. Kaupfélag Skagfirðinga is the largest business in the region, and is involved in fisheries, dairy production, meat production and more. The equal pay standard is accepted in Iceland as a useful measure for securing equal... A break on private initiative. You would be excused for believing the equal pay standard means women get more pay, but that is not the case at the Regional Development Institute Byggðastofnun. Subscription is free of charge. This gives the wage system a certain discipline. ... to undergo certification every three years to show they adhere to the Equal Pay Standard. The standard means everyone should be paid the same for the same type of work. Why Has GameStop's Stock Gone Up So High Recently? So the internet informs me that Iceland has become the first country in the world to make it illegal to pay men more than women. The question now is how effective a measure like this will. The gender pay gap, namely the higher salary men receive compared to women for work of the same or equal value and that can only be understood as a negative bias against women – is a worldwide problem of gender discrimination. “The legislation is based on the equal pay standard that was developed here in Iceland and provides guidelines that companies can implement to make sure they are paying men and women equally.” The New Year ushered in a new wage policy in Iceland, where it is now illegal for companies to pay men more than women for the same job. All Rights Reserved. Byggðastofnun staff never discuss their wages, but Sigurður thinks the equal pay standard is a good thing. What makes Iceland so good when it comes to gender equality? This creates positivity and trust, but sadly, in practice salaries are still secret in Iceland. Should an economist working with customer service be paid differently from an economist working with stocks and shares? The current gender pay gap in Iceland is about 14% to 18%; the government reportedly plans to eradicate it by 2022. Friðbert Traustason from The Confederation of Icelandic Bank and Finance Employees is not certain that the equal pay standard will close Iceland’s pay gaps. The Gender Pay Gap = not Cool! Text Guðrún Helga Sigurðardóttir, photo: Friðrik Friðriksson. Byggðastofnun is financed by the Icelandic state. * The request timed out and you did not successfully sign up. 2018 Update Law on Equal Pay Certification based on the Equal Pay Standard in Iceland. While people have been quick to comment, either praising Iceland as a feminist utopia or condemning the naïve attempt to fix a complicated problem, the case of equal pay legislation and Iceland… Friðbert points out that the certification legislation only certifies what different companies decide themselves, without any negotiations with employees. Friðbert also believes the equal pay standard reduces people’s private initiative at work. Equal Pay Legislation for Over 50 Years. Byggðastofnun's staff are all members of the medium-sized finance cooperation SFF – The Icelandic Financial Services Association, which counts 4,000 members in total. Sigurður Árnason  got a pay raise thanks to the  equal pay standard. — On March 8, 2017, Prime Minister Bjarni Benediktsson announced in a meeting in New York that Iceland planned to mandate equal wages for men and women. The gender pay gap ranged relatively constantly around 15 to 16 per cent. What President Biden's Call With Putin Means for U.S.-Russia Relations. Since the first edition of the Forum report in 2006, Iceland has closed around 10% of its total gender gap, making it one of the fastest-improving countries in the world. “The equal pay standard is the best weapon employers have been handed for many decades,” says Friðbert Traustason, Chairman of The Confederation of Icelandic Bank and Finance Employees. Receive Nordic Labour Journal's newsletter nine times a year. Byggðastofnun are members of the finance confederation. Now another small country has joined a global effort to try narrow the gap in pay between genders: Iceland. She is also the trade union representative there, and knows what staff think about the equal pay standard and how it benefits them. “I think companies should be able to reward staff who show initiative and skills. Iceland, equal pay and enforcing the gender pay gap regulations. Aðalsteinn argues the equal pay standard puts the wages into a system where all procedures are documented and all salary decisions are justified. Since then, there has been a flurry of interest from the international news media about the proposed legislation. Close. From Reykjavík in the south to Sauðárkrókur in the north – companies across Iceland are introducing the equal pay standard which aims to eradicate gender pay gaps. Agriculture is key to this region, which gets most of its income from food production. Why should anyone work more and show enthusiasm if she or he stands no chance of getting rewarded for their extra effort? With a staff of 28, Byggðastofnun is one of the main employers in Sauðárkrókur. Gender pay gaps always represent a problem for society. Byggðastofnun is an independent body which helps develop Iceland's regions and businesses in rural areas. This has yet to change. Gender pay gaps always represent a problem for society. Iceland's women leave work at 2.38pm to protest gender pay gap. Wolfgang Kaehler—LightRocket/Getty Images, Biden's Sign Language Interpreter Tied to Far Right. The authority prepares, plans and finances different development projects and, supports and strengthens local development by the provision of credit and other forms of financial support. A major turning point in the global fight for gender pay parity was marked on January 1, 2018 when a new Icelandic law on pay certification came into force. Nearly half of Iceland’s parliamentarians are women, and the country has had a female President for 20 of the last 50 years. In the E.U., women earn 84¢ for every dollar earned by men. Equal Pay Act in Iceland. The equal pay standard makes this impossible,” says. Anna Lea says workers feel they are stuck at certain wage levels, and that they do not know how to go about getting a pay rise, or whether it is at all possible to get one because the equal pay standard limits their opportunities. This appears in the January 15, 2018 issue of TIME. On January 1, 2018, the country fully enacted the world's first equal pay law. All staff at Byggðastofnun are members of the finance confederation. Iceland, however, is charting new territory. In 2017, the World Economic Forum has predicted that women will not be paid as much as men for the next 217 years. She wants more openness around how wages are set on different levels, and would also like to see more information about the equal pay standard and how it affects employees. In an eyebrow-raising move, the country this year launched a new law requiring public and private employers to show that all employees are being paid equally for equal work. The legislation, which came into force on the first … Posted on January 5, 2018 by Darren Newman. Unlike Iceland, the people making laws and holding positions of corporate leadership in this country are still largely men. Work Research InstituteOsloMet – Oslo Metropolitan University,Postboks 4 St. Olavs plass, NO-0130 Oslo. In the U.S., that figure is 80.5¢, according to the Census Bureau–and the gap is even higher for American women of color. Update 2020: Reykjavik enforces the Equal Pay Act – with all its might. The trade unions have been positive to it, but sceptical voices exist in the finance confederation. It's free. The 2017 law doesn't just expose a company that violates the principle to lawsuits. And its new law requires companies with 25 or more employees to obtain certification to confirm that equal pay is a reality for all employees, regardless of gender. You can unsubscribe at any time. But even there women earn an average of 14 to 18 percent less than men. Sauðárkrókur is a town in Northern Iceland with 2,600 citizens (above). As of 2015, 44% of boardroom executives in Iceland were female, compared with an OECD average of 20%. “The wage system is based on stability and equality. Already in 1961, the Icelandic Parliament approved the Equal Pay Act to ensure equal remuneration for women and men for equal work or work of equal value. The town's population is growing and has reached around 3,000 people. But the reform also faces criticism from some who say it restricts employees’ opportunities to secure pay increases and bonuses. Aðalsteinn Þorsteinsson, the Director General for Byggðastofnun, explains that regions become vulnerable and that there is a risk of more social problems if there is an imbalance between the genders. Wage disparity means women all across Europe are essentially working for free. Subscribe to the latest news from the Nordic Labour Journal by e-mail. The Central Bank of Iceland complies with the provisions of the Act on Equal Status and Equal Rights of Women and Men, no. The first ones have started to learn about what means in practice. Use of this site constitutes acceptance of our. All secretaries are on the same wage, all specialists are paid the same and all managers are paid the same,” says specialist Anna Lea Gestsdóttir. 10/2008. The equal pay standard is accepted in Iceland as a useful measure for securing equal pay between men and women. Iceland has had legislation supposed to guarantee equal pay for men and women for a very long time. Though statistics vary widely on the domestic wage gap, many equal-pay advocates cite a … Iceland's world-first gender pay laws come into effect, requiring businesses with 25 or more employees to prove they are paying men and women fairly to do the same jobs. Iceland’s parliament has presented a bill that would require public and private businesses to prove they offer equal pay to employees, in what would be the first such requirement in the world. Byggðastofnun has been located in Sauðárkrókur since 1998, when it moved from  Reykjavík. The economy is largely based around agriculture, but also fisheries. 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