Any of the arXiv licenses can be chosen; they are all compatible with the above quoted terms of the IOP policy. From arXiv Submittal Agreement Terms and Conditions (revision 0.8.3):
Management of Copyright
This grant to arXiv is a non-exclusive license and is not a grant of exclusive rights or a transfer of the copyright. The authors retain their copyright and may enter into publication agreements or other arrangements, so long as they do not conflict with the ability of arXiv to exercise its rights under the License. arXiv has no obligation to protect or enforce any copyright in the Work, and arXiv has no obligation to respond to any permission requests or other inquiries regarding the copyright in or other uses of the Work.
The Submitter may elect to make the Work available under one of the following Creative Commons licenses that the Submitter shall select at the time of submission: Creative Commons Attribution license (CC BY 4.0); Creative Commons Attribution-ShareAlike license (CC BY-SA 4.0); Creative Commons Attribution-Noncommercial-ShareAlike license (CC BY-NC-SA 4.0); Creative Commons Attribution-NonCommercial-NoDerivatives license (CC BY-NC-ND 4.0); arXiv license (https://arxiv.org/licenses/nonexclusive-distrib/1.0/license.html); or Creative Commons Public Domain Dedication (CC0 1.0).
If you wish to use a different CC license, then select arXiv's non-exclusive license to distribute in the arXiv submission process and indicate the desired Creative Commons license in the actual article.
The Creative Commons licenses are explained here: https://creativecommons.org/licenses/.
Metadata license
To the extent that the Submitter or arXiv has a copyright interest in metadata accompanying the submission, a Creative Commons CC0 1.0 Universal Public Domain Dedication will apply. Metadata includes title, author, abstract, and other information describing the Work.
Bold emphasis in first paragraph is mine.