Framework Conditions in Iceland
Gender Pay Gap in Iceland
The gender pay gap in Iceland reflects with around 15.5 per cent (2016) European average. Despite the average wage gap, Iceland ranks first in the Global Gender Gap Report 2020 for years in a row and is often mentioned for a high level of equality measures.
Equal Pay Act in Iceland
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 gender pay gap ranged relatively constantly around 15 to 16 per cent. Especially the economic crisis in 2008 had enormous impacts on the gender pay gap increasing the gap up to 28 per cent.
On October 24, 2016, thousands of women across Iceland walked out of their workplaces at 2.38pm demonstrating against the gender pay gap. The pay discrepancy means that Icelandic women effectively work without pay after this time, according to unions and women’s organizations.
On March 8, 2017, the Icelandic Government announced to introduce a new law in order to close the wage gap. A bill of law (amendments to the Gender Equality Act No. 10/2008) was passed by the Parliament on June 1st, 2017 and came into force on January 1st, 2018. This law requires companies with more than 25 employees to proove on annual basis that wages are fair. Therefore they will be required to obtain equal pay certification of their equal pay system and the implementation thereof. The central goal of this legislative initiative is to close the wage gap entirely by 2022.
Equal Pay Management Standard
In 2012, the Equal Pay Management Standard IST 85:2012 has been introduced. The standard has been developed by representatives of the related ministries as well as employees' and employers' organisations. "The idea was to create a system that could confirm that women and men, working for the same employer, were paid equal wages and enjoyed equal terms of employment for the same jobs or jobs of equal value."
The standard first provided a voluntary measure for companies to analyse their wage structures. Companies who implement the standard are then certified for their efforts in implementing equal pay.
The latest legislative initiative from 2017 makes this standard mandatory for companies with more than 25 employees. Companies now have be certified in regular intervals. If companies fail to get certified, fines of upt to 400 Euros per day will be imposed.
- Goverment Offices of Iceland: The Equal Pay Certification
- The Standard Equal Pay Management Standard IST 85:2012
- Government Offices of Iceland: Equal Pay Certification