Should the UK follow Iceland’s lead on equal pay laws?


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In UK law it is not as simple as men and women being paid the same for doing the same job

Men and women must be paid for like work, work rated as equivalent under a job evaluation or work of equal value. There is a defence of material factors unconnected with sex and what amounts to work of equal value is complex, needing expert evidence. It requires employees to bring claims in an employment tribunal to enforce their rights. As recent BBC salary figures show, there is still some way to go.

There have been a number of well-publicised equal pay claims, the most recent involving 7,000 shop floor female employees at ASDA who say they do work of equal value with men in the distribution centre who are paid £4 an hour more.

Iceland tops the World Economic Forum’s gender equality index. The UK comes in at 15th. In 1975 90% of Icelandic women went on strike, in homes and offices, in protest for equal pay. Iceland introduced equal pay legislation but it has not worked. So on 1 January 2018 the Icelandic parliament, who until last year had almost 50% female representation (now 36%) introduced the ‘Equal Pay Standard’. Any organisation employing 25 or more employees must get government certification every three years for its equal pay policies.

Employers are required to go through a pay assessment process that classifies jobs according to the value created for the company and determines pay based on the position held in the company. This is going to be phased in over four years with the largest companies having to implement it within a year.

But will this create a system that is too rigid and does not encourage individuals to flourish or value benefits such as flexible working or on-site childcare? These benefits will be hugely valuable to parents with children but not those without. Will it stifle the stars who, no matter how much more effort they put in, will never be paid more? Only having to be certified every three years, will this mean that companies will flout the equal pay laws in the intervening period?

Could the UK do the same? Looking at the practicalities, Iceland has a population of 334,252 and the UK has a population of 65.64 million. The time and resources necessary to force every UK organisation employing 25 or more down the same path makes it an unrealistic prospect.

Perhaps a better way, and one favoured by many business leaders in Iceland, is some form of voluntary kitemark like ISO or Investors in People. Those not achieving the kitemark might find themselves losing out in public and private tenders in the future and this will encourage them to focus on doing more than paying lip service to equal pay.

Beverley Sunderland is managing director at Crossland Employment Solicitors

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