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How Iceland Managed to Decrease its Gender Pay Gap

© Helgi Halldorsson/Flickr
© Helgi Halldorsson/Flickr
Iceland became the first country in the world to legislate to ensure equal pay between men and women. The new law took effect on the first day of 2018 adding to an already impressive list of reasons why Iceland is one of the best places to be a woman.

The new law makes it illegal for companies and government agencies, which employ at least 25 workers, to operate without a certification proving their equal-pay policies. The law ensures that women and men are paid equally, with those who do not comply with being forced to pay a fine.

The Icelandic Revolution © Helgi Halldorsson/Flickr

Iceland, a small island nation in the North Atlantic with a population of 330,000, also had the first democratically elected female president in 1980 and the first openly gay prime minister in 2009. Iceland’s new centre-right government, spearheaded by the newly elected prime minister Katrín Jacóbsdóttir, a noted feminist and environmental activist, proposed this new legislation which was also supported by the opposing party members. The parliament, which is nearly equally gender balanced, plans to completely close the gender wage gap by 2020.

Six months since Iceland put the law into effect, essentially making it illegal for businesses to pay women less than men for the same job, the results are paying off little by little with a few cases of women receiving a wage increase when it was realised that their pay was not matching their male counterparts. Largely, however, the problem still persists even though Iceland has been ranked first on the World Economic Forum’s Gender Gap Index for nine years. It was found that Icelandic men still make up to 12% more than women doing similar work, according to BSI Iceland, a consultancy company policing the new equal pay law.