Iceland has developed a reputation as a sort of nirvana for working women, ranking No. 1 on the World Economic Forum’s index for gender equality. But the Nordic nation is by no means perfect, a point Prime Minister Bjarni Benediktsson made at the United Nations on Wednesday when he introduced a plan requiring Icelandic companies to pay men and women the same salary for the same work.
Benediktsson’s bill would require companies with at least 25 employees to undergo certification every three years to ensure their pay policies follow the equal pay rules. If the measure passes parliament as is expected, given the legislature’s near-even gender split, it will be the first law in the world to federally require equal pay at private and public firms alike. Other countries have equal-salary certificate policies, but Iceland is thought to be the first to make it mandatory for all large employers. Switzerland has a similar law that punishes non-compliers by making them ineligible for federal contracts. The U.K. will soon have an equal pay initiative that will force large employers to disclose how much they compensate male and female staff, but it doesn’t include a punitive measure for the worst offenders.
Iceland’s Equality and Social Affairs Minister Thorsteinn Viglundsson acknowledged that the new bill is a big ask of business. “It is a burden to put on companies to have to comply with a law like this,” he said.
For what it’s worth, several U.S. employers have voluntarily adopted equal pay practices. CEOs of companies that have done so have told me that it’s actually not such a huge lift. Salesforce CEO Marc Benioff says identifying and eliminating the gender pay gap is relatively easy given modern human resources systems. “Every CEO needs to look at if they’re paying men and women the same,” he says. “That is something that every single CEO can do today.”
Bonnie Crater, a former Salesforce SVP who instituted an equal pay pledge at her 39-person startup Full Circle Insights, told me that guaranteeing pay parity “is really easy.” It’s a matter of examining which employees land in what salary bands and identifying any gendered pay discrepancies, she explains. “Every now and then—whether it’s every year or every other year—you call up your HR department and ask for the report,” she says.
Iceland’s Viglundsson says the new bill is worth the potential business risks. “You have to dare to take new steps, to be bold in the fight against injustice.”