Having recently returned from a holiday in the very cool country of Iceland (no pun intended), I was really interested to read this week about the latest development in their equal pay legislation.

Much like the UK, it’s been illegal to pay men and women unequally for the same work for decades – but a persistent pay gap remains. The Icelandic solution? Require all organisations with more than 25 employees to prove they pay men and women the same.

Companies will have to comply with the Equal Pay Standard, which is a set of rules which analyses the pay structure within a company, showing whether men and women are paid equal wages for the same value of work. When companies have fulfilled the requirements of the standard, the government will certify that they have complied. The aim that all companies will have Equal Pay Standard certificates by 2021, while those failing to demonstrate pay equality will face fines.

Good for them, I hear you say. But what does this mean for us here in the UK?

Here at Innecto we’ve seen first-hand how gender pay is changing the agenda. What many organisations initially saw as a compliance issue, or even politically correct box-ticking, has since caused many business leaders to re-examine their priorities and question whether their business is losing out over gender pay.

Most of the attention so far has centred on publishing those first set of numbers, and whilst a very small number (650) can now breathe a small sigh of relief, the real challenge begins next year. How can companies show they are actively trying to close their gender pay gap?

That is why the Icelandic example is of interest, as it may well be the next tool the UK government looks to in a few years’ time when our pay gap refuses to close. Slow progress is better than no progress, but employees want pay parity now, and rightly so. The Equal Pay Standard may be a blunt instrument, but it certainly beats waiting 50 years to wear down systemic barriers and unconscious discrimination.

Whilst gender pay certification would be another bureaucratic hammer to pound the already bruised cranium of UK business (to stretch a metaphor to breaking point), if it helps end the pay gap then I’m all for it.

We’ll be watching closely to see the impact this new legislation has in Iceland and whether it can fully overcome the deep-rooted societal stereotyping which drives pay inequality. In the meantime, we wish our Icelandic counterparts gangi þér vel *good luck!

Innecto can help with any aspect of pay and reward. Contact us on 020 3457 0894 or email enquiries@innecto.com. 

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