I have seen and heard a lot of references made recently to the ‘Living Wage’, but probably, like most employers, I didn’t fully appreciate the difference between the Minimum Wage (NMW) and the Living Wage (LW).
Unlike the NMW, which is set by the Government funded Low Pay Commission, the LW is set by the Living Wage Foundation, calculated by the Centre for Research in Social Policy.
There appears to be two rates, depending on whether you are inside of London or outside and actually, the differences between the NMW and the LW is perhaps surprising.
The current rates are as follows: –
London – NMW – £6.31 LW – £8.80
National – NMW – £6.31 LW – £7.65
Politicians might argue that it is morally right to pay in line with the LW and to be honest, I wouldn’t necessarily disagree with that.
However, what I think is probably more important for business owners is that fact that this is an great way of promoting your business and a ‘Living Wage’ employer and an excellent way of getting and retaining good staff members.
What are the benefits?
Good for Business
An independent study examining the business benefits of implementing a Living Wage policy in London found that more than 80% of employers believe that the Living Wage had enhanced the quality of the work of their staff, while absenteeism had fallen by approximately 25%.
Two thirds of employers reported a significant impact on recruitment and retention within their organisation. 70% of employers felt that the Living Wage had increased consumer awareness of their organisation’s commitment to be an ethical employer.
Good for Families
The Living Wage affords people the opportunity to provide for themselves and their families.
75% of employees reported increases in work quality as a result of receiving the Living Wage.
50% of employees felt that the Living Wage had made them more willing to implement changes in their working practices; enabled them to require fewer concessions to effect change; and made them more likely to adopt changes more quickly.
If you are interested in becoming a Living Wage employer, then I strongly recommend you have a look at their website http://www.livingwage.org.uk/home