3. The concept of work of equal value, methodo­logy and structure of the report

Differentials in pay between work dominated by women and work not dominated by women is the main reason for the existence of a gender pay gap. The principle of equal pay for work of equal value is based on the knowledge that work dominated by women is generally valued less in terms of pay than work not dominated by women with equivalent qualification requirements.

The requirement of equal pay for work of equal value, i.e. pay equity, is mentioned in the introduction to the ILO Founding Constitution, as far back as 1919.

The International Labour Organization (ILO) is the UN’s special agency for employment and labour issues.

In 1951, the ILO adopted Convention No. 100 concerning equal remuneration for women and men workers for work of equal value. At that time, it was made clear that the basis for comparing different work should be the content of the work, regardless of whether the work was similar or not. There is no case law on ILO Convention No. 100 that is legally binding on signatory states. However, there are non-legally binding statements made by the ILO Committee of Experts.

ILO (1986) Equal Renumeration, International Labour Conference 72^nd Session 1986.

The principle of equal pay for work of equal value has been clarified mainly in the context of EU law. The first equal pay directive was adopted in 1975 and has since been replaced by Directive 2006/54. The EU Pay Transparency Directive (2023/970) further clarifies the EU’s principle of equal pay. Article 4(4) of the Directive states that the criteria for assessing the equivalence of two jobs are skills, effort, responsibility and working conditions. This represents a codification of previous case law. The principle of equal pay is also enshrined in Article 157 of the Treaty on the Functioning of the European Union.

From the case law of the Court of Justice of the EU, it follows that a prerequisite for the payment of damages for pay discrimination is that the pay comparisons can be attributed to a single source.

See cases C-320/00 Lawrence cl. 18, C-256/01 Allonby, cl. 46 and C-624/19 Tesco Stores.

The ILO’s Equal Pay. An introductory guide from 2013 interprets work of equal value in line with the case law of the Court of Justice of the EU. This means that the concept of work of equal value in this context relates to pay comparisons at the local level, usually in the context of a single employer, which may include workers from different operational units or different parts of a corporate group.

In a Nordic context, the concept of work of equal value has received particular attention in four dissertations: Susanne Fransson (2000) Lönediskriminering – en arbetsrättslig studie av könsdiskriminerande löneskillnader och konflikten mellan kollektivavtal och lag (Pay discrimination – a labour law study of gender-discriminatory pay differentials and the conflict between collective agreements and the law), Anja Nummijärvi (2004) Palkkasyrjintä. Oikeudellinen tutkimus samapalkkai-suuslainsäädännön sisällöstä ja toimivuudesta (Pay discrimination. A legal study of the regulation of equal pay and its content and functions), Byrial Bjørst (2005) Ligeløn for job af samme værdi (Equal pay for jobs of equal value), Lena Svenaeus (2017) Konsten att upprätthålla löneskillnader mellan kvinnor och män (The art of maintaining pay differentials between women and men).

With the adoption of the United Nations’ Agenda 2030, the concept of work of equal value has been set in a new context. Among other things, goal 8.5 of the Agenda commits states to achieving equal pay for work of equal value by 2030. To monitor progress towards this goal, there is a specific indicator, 8.5.1, which aims to describe the development of the pay gap in relation to the concept of work of equal value. The ILO (custodian agency) is responsible for formulating and administering this indicator. The formulation of indicators and the use of statistics have a political dimension, as the figures communicated regarding the scale of gender pay differentials are a decisive factor in whether or not they are perceived as a high-priority social problem.

The range within which the issue of the size of the pay gap is communicated is typified by an example from Sweden, using 2021 figures as a starting point. According to official statistics, the pay gap for this period was 9.9 per cent. The starting point for these calculations is proximate to the concept of equal work. However, the notes on these statistics stated that the statistically unexplained pay differential is reduced to 4.5 per cent when applying standard weighting and to 4.2 per cent when using regression analysis.

The Swedish National Mediation Office (2022) Löneskillnader mellan kvinnor och män 2021 (Pay differentials between women and men 2021).

On the basis of the same statistical data, the Swedish Gender Equality Agency presented a draft indicator aimed at describing structural pay differentials. In this case, all occupations were grouped into 13 equivalent requirement levels. The estimated pay gap in this case was 19 per cent. This example, presented in more detail in Chapter 6, illustrates the differences between the principle of equal pay for equal work and equal pay for work of equal value. 

When discussing the topic of work of equal value, it is important to distinguish between material that refers to the local level and material that aims to illustrate differentials at the industry, regional or national levels. Pay data based on job evaluations of individual employers cannot be aggregated to illustrate pay differentials regarding work of equal value at an aggregate level.

Due to the scope of the assignment and the content of the source material, the report is characterised by an interdisciplinary industrial relations perspective. A dogmatic legal method forms the basis for the description of the legal source material in the form of legislation and case law. The presentation then moves on to describe the functionality of the law in a social context. In this context, the report describes how social partners and the state relate to the concept of work of equal value in various forms. Another central concept is job evaluation, which is linked to both research on organisational theory and gender. It also describes various methods for using statistical tools to describe the undervaluation of work dominated by women. The report takes a comparative approach. This is particularly justified as the concept of work of equal value is not linked to national characteristics but to common commitments resulting from the signing of ILO Convention No. 100 and from EU and EEA law.

The Nordic countries consist of Denmark, Finland, Iceland, Norway, and Sweden, as well as the Faroe Islands, Greenland and Åland. The Faroe Islands and Greenland have their own legislation prohibiting pay discrimination based on equal work and work of equal value.

See § 4 in the Equality Act of the Faroe Islands and § 14 in the Greenlandic Discrimination Act.

Åland has no equivalent legislation of its own. Particular attention is not given to these autonomous territories in this report. This is due to the fact that specific information on the theme of work of equal value in the form of reporting, statistics or case law from these areas has been difficult to access

The report is primarily based on material received up to 1 May 2024. References to reports and studies in Chapter 7 primarily cover the period 2019–2024.

The report is a supplement to and further development of NIKK’s previous publication Lika lön i Norden – Lagar och politiska strategier, Måve (2019; Equal pay in the Nordic countries – laws and policies).

Some parts of the text, primarily the description of legislation in the Nordic countries, are taken and adapted from a report published in 2020.

Stüber (2022) Pay transparency – ett nordiskt perspektiv med Island som utgångspunkt, underlagsrapport till Kommissionen för jämställda livsinkomster, dnr. Komm2020/00749/A (Pay Transparency – a Nordic perspective with Iceland as a starting point, background report to the Commission on Equal Lifetime Earnings, No. Komm2020/00749/A).

An English version of the report will be finalised in the autumn. The Nordic Council of Ministers has previously published a report on the theme of job evaluation and work of equal value, Lon efter fortjeneste? Nord 1992:10 (Pay according to merit? Nord 1992:10).

Chapter 4 describes the legal frameworks in the Nordic countries and where the concept of work of equal value applies. Descriptions of the countries’ pay survey provisions take centre stage. Special attention is paid to the Icelandic standard ÍST 85:2012 Equal wage management system. In the case of Denmark, requirements for reporting statistics on pay differentials between women and men are described. These various provisions are proactive in nature, focussing on comparing pay between groups of workers. Furthermore, prohibitions against pay discrimination are described, the main function of which is to provide compensation for past or ongoing disadvantage. In these cases, the focus is on the pay setting of individual workers. 

Chapter 5 provides a picture of the case law in the Nordic countries where the concept of work of equal value has been subject to interpretation. The chapter estimates the prevalence of judicial reviews of work of equal value compared to all judicial reviews of discrimination issues.

Chapter 6 focuses on national commitments. It begins by presenting each country’s reporting back to the ILO on the implementation of Convention No. 100 and the ILO’s feedback on these reports. It then discusses the reporting of pay data in the context of Agenda 2030 and the role of the ILO in this context. The chapter draws attention to alternative approaches that aim to develop methods to describe pay differentials between work of equal value at the sectoral, regional, or national level.

Chapter 7 aims to summarise research, studies or government reports published since 2019 that focus on issues of work of equal value or structural pay differentials between women and men. The chapter concludes with an assessment of any specific characteristics regarding the content of the different countries’ publications and possible commonalities.

Chapter 8 focuses on the link between work of equal value and the EU Pay Transparency Directive 2023/970. It begins by describing the implications of the pay reporting and publication requirements that enable comparisons between employers, sectors, and regions within a country. This is followed by a description of how comparisons of equal work and work of equal value have been interpreted under current pay survey provisions and the changes that the Directive will introduce. It also addresses the issue of Member States’ responsibilities for developing templates and analytical tools in light of the need to limit additional costs and administrative burdens for employers.

In the following two chapters, the perspectives are broadened somewhat. They highlight parallel processes that can be indirectly linked to the theme of work of equal value. The first example, in Chapter 9, deals with the interaction between pay survey requirements, requirements for reporting pay statistics linked to the international ISCO standard and the design of existing collective labour agreements. It highlights shortcomings in this interaction, which have resulted in recurring objections from employers regarding ‘double work’. The discussion centres on an example based on Swedish conditions.

Chapter 10 describes certain features of the Nordic labor market models. A recurring theme in the discussion of structural pay differentials between women and men is the role played by different variants of the frontline labour model in the various Nordic countries. This chapter provides a brief overview of the implementation of this model in each Nordic country and how it relates to the theme of equal pay.

Chapter 11 presents a concluding discussion. It centres on the question of the implementation of the EU Pay Transparency Directive and how it might affect the Nordic labour market model. It also discusses the extent to which complementary measures may be necessary, either through legislation or collective agreements. As the Nordic Council of Ministers has expressed an ambition to strengthen exchanges in the area of equal pay, work of equal value and job evaluation, and to build alliances in the Nordic countries, the report concludes with some ideas for such further work.