Iceland scraps gender pay gap, makes it illegal to pay women lesser than men

India is running far behind in the global race to bridge the gender pay gap, as on a global average, women earn only 57 per cent of what men do for the same work.

Though most countries all over the world are not yet up-in-arms about the gender pay gap in workplaces, Iceland has yanked out the problem by its horns. As per a new law in the country, companies need to prove that the salary given to female companies doesn’t discriminate against their gender by paying them less than their male counterparts.

A majority in parliament passed the law, which prevents women getting lesser salaries than men for doing the exact same job, in June. However, it only took effect in the New Year. The current pay gap in Iceland between the salaries of men and women is 5.7 per cent. In India, the gender pay gap is as high as 24.81 per cent, as per 2013 data.

Iceland, with a population of only 3,30,000, has a female Prime Minister — Katrin Jakobsdottir and ranks right at the top on World Economic Forum’s global gender equality index.

Some other states such as Minnesota in US already have an equal-salary certificate policy in place, but Iceland is the first country to make it compulsory for both private and public firms As per the World Economic Forum, two-thirds of OECD countries already have pay-equality policies in place. Certain employers also need to publish their gender pay-gap calculatio

  • In Iceland, companies employing more than 25 people now need to obtain a government certificate proving that they pay their male and female employees equally. Otherwise, they stand to face fines
  • The salary differences can only be based on valid points such as education, performance and skills
  • The certification must be renewed every three years
  • Companies with more than 250 employees have till the end of the year to produce their equal pay certificates
  • Smaller companies have till EOD 2021 to get their certificates ready

Iceland hopes to get rid of gender pay gap by 2022. Researchers on equal rights said that they hope Iceland’s initiative might help address the huge lack of female politicians all over the world.


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