Iceland becomes first country to punish companies for paying women less

Employers in Iceland that fail to ensure pay parity will now be subject to fines, thanks to a law that went into effect on January 1.

Iceland began the new year by becoming the first country in the world to mandate that all its companies must pay men and women equally.

Common Dreams said that after years of passing legislation promoting equal pay, employers that fail to ensure pay parity will now be subject to fines, thanks to a law that went into effect on January 1.

“We have had legislation saying that pay should be equal for men and women for decades now but we still have a pay gap,” Dagny Osk Aradottir Pind of the Icelandic Women's Rights Association told Al Jazeera. 

“We have managed to raise awareness, and we have managed to get to the point that people realise that the legislation we have had in place is not working, and we need to do something more.”

Under the new law, companies that employ more than 25 people will have to prove to the government that they are paying men and women equally. Officials hope the move will help Iceland to completely close its gender wage gap by 2020.

Iceland has a record of policies promoting gender equality, filling nearly 50% of its parliamentary seats with women. For the past nine years, the small island country has been the world’s highest-ranking nation in terms of gender equality according to the World Economic Forum's (WEF) Global Gender Gap Report.

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