Equal pay in Iceland: Retail co-op leads the way

Samkaup retail co-op has a gender pay gap of just 0.4%

In 2018, Iceland became the first country to enforce equal pay for men and women, requiring companies to prove they pay employees in the same roles equally, regardless their gender, sexuality, or ethnicity.

Samkaup, one of the largest retailers in the country, was quick to comply. The retail co-op runs 60 stores, has a 25% market share and employs 1,250 people.

As part of the implementation, enterprises with more than 25 employees have to go through an Equal Wage Management Standard, which rates the job itself, rather than the person doing it. If they can show they pay equally for the same positions, they receive an Equal Pay certification. Those that fail to do so get fined ISK 50,000 (€397) per day.

Samkaup received its certification in January 2019, a year before it became mandatory. To further drive gender equality, the retailer adopted an Equality and Equal Pay Policy, which forms part of its Human Resources Policy and covers all employees regardless of gender, age, race, religion and sexual orientation.

The policy focuses on paying women and men equal wages and the same terms for the same or equally valuable jobs, providing equal opportunities including around vocational training and education, fighting any forms of sexual harassment, bullying or violence and making the co-op a family-friendly workplace.

“Samkaup has implemented an equal pay system that covers all employees and contains an equality plan to make sure that we are paying and giving the same opportunities to all employees, and this policy is based on it,” said managing director of human resources, Gunnur Líf Gunnarsdóttir.

“Samkaup emphasises gender equality and utilises the equal strengths of women and men so that the talents, powers, and skills of all the company’s employees are enjoyed to the fullest. With Samkaup’s Gender Equality Plan, the management has committed itself to emphasising gender equality, where everyone is valued according to ability and performance.”

After receiving the Equal Pay standard certification, the co-op reassessed its equal pay system in October 2020.

“Wage analyses has been done twice to measure the wage gap and the results had been good. In 2018, the gender wage difference was 3.9%, while in 2019 it was 2.9%, and in 2020 it was 0,4% which shows good and improved results. Samkaup’s goal is for the wage difference to be 0%,” added Ms Líf Gunnarsdóttir.

Iceland’s journey to eradicating the gender pay gap by 2022 is work in progress. Iceland’s gender wage gap, defined as the difference between median earnings of men and women relative to median earnings of men, stood at 12.8% in 2018, according to OECD data.

Samkaup continues to monitor its equal pay system, reviewing progress every year to ensure it stays on track.

Employees have equal opportunities to develop in their work, regardless of gender and efforts are being made to have a gender ratio that is equal and that jobs are not classified as specific men’s or women’s jobs, added Ms Líf Gunnarsdóttir.

Samkaup’s goal is for all employees to have access to increased vocational training, retraining and education. “Women and men enjoy the same opportunity to attend courses to increase their skills at work or for preparation for other jobs at Samkaup. We monitor all talents that go though our educational program and push for equality when needed,” said Ms Líf Gunnarsdóttir.

Icelandic laws require that proportions of board members in medium and large enterprises are not below 40% for either gender and this is reflected in the board of Samkaup as well, which is 40% made up of women.

“For managers and executives, we have committed the company to have 60/40. For store managers we have 53% women and 47% men,” added Ms Líf Gunnarsdóttir.

Iceland continues to top the World Economic Forum’s Global Gender Gap Report as the most gender-equal country of the 153 states included. The report, which looks at Economic Participation, Educational Attainment, Health and Survival and Political Empowerment, found that Iceland closed over 88% of its overall gender gap.

Ms Líf Gunnarsdóttir argued that while the government’s push for an equal pay system makes companies reconsider their policies, in Samkaup’s case, the decision was also backed by the board and its executive team.

“From day one we had a clear vision and dedication that putting equality in focus would be supported and part of the society we want to have,” she said.

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