Iceland Proposes Gender Pay Gap Law To Ensure Companies Give Equal Wage To Employees


Iceland's parliament presented on Tuesday, April 4, a bill that would require private companies and government institutions to provide equal pay to their employees regardless of gender.

World's First Law To Close Pay Gap

The proposed law, which could become the first in the world, aims to close the wage gap between men and women.

The bill requires that companies and institutions with at least 25 or more employees undertake a certification of their equal pay programs.

The bill will now be debated and, once passed, will take effect starting January 2018.

It would require public and private companies and agencies to go through audits and certification to prove that they provide equal pay. Besides gender, the law also prohibits discrimination on the grounds of religion, race, occupational disability, sexual orientation and age.

Fines will be imposed on those who violate equal pay just as companies are subjected fines if they fail to deliver documents of annual financial statements.

One Of The Best Places For Women

Iceland is arguably one of the best places for women. Nearly 50 percent of legislators in Iceland's parliament are women and a voluntary measure for equal pay was introduced in 2012.

The Scandinavian country ranks first on the 2015 Global Gender Gap Index of the World Economic Forum, besting Norway, Finland and Sweden, but it still had an unadjusted gender pay gap of 17 percent during the same year. Once approved, the new law could put an end to the wage gap in the island nation that consists of over 323,000 people.

Pay Gap In Other Countries

While some women in Iceland earn less than men, the country's gender pay gap of 17 percent is still better when compared with those of other countries including the United States, where women on average get paid 21 percent less than men. A 2015 study also showed that in female-dominated nursing profession, male nurses get paid higher, earning at least $5,000 per year more than their female counterparts.

Similar patterns exist in many other first world countries. Glassdoor reported last year that men in the UK earn 22.9 percent more than women. The gap is 17.3 percent in Australia, 22.5 percent in Germany, and 14.3 percent in France.

In an incident that prompted a European parliament probe, a Polish lawmaker cited reasons why women have to earn less than men.

"They are weaker, they are smaller, they are less intelligent," Janusz Korwin-Mikke has said.

Iceland's Solution To Pay Gap

Such sentiment is not likely to be publicly heard of from lawmakers in Iceland but issues with regard to equal treatment continue to surface here. In October last year, thousands of women decided to leave their work early to go to the streets of capital Reykjavik to protest against women having less earnings than men.

"The gender pay gap is unfortunately a fact in the Icelandic labour market and it's time take radical measures; we have the knowledge and the processes to eliminate it," minister of social affairs and equality Thorsteinn Viglundsson said.

Viglundsson acknowledged that law could be burdensome as it sets new obligations but noted the benefits of such law.

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