Fair pay! How to boost pay for 1 in 4 workers in Wales

At the start of Living Wage week, Victoria Winckler sets out five things that the Welsh Government should do – and three things that you can do – to boost the pay of  300,000 workers who are not paid enough to live on.

Stories about poverty and low pay are now commonplace. In the last month alone there have been reports on poverty, low pay, and debt to name but three – and there was nothing special about the last four weeks. There cannot be many people who do not know that 1 in 4 people in Wales have incomes below the poverty threshold.

At the heart of these problems is pay.

There are, very simply, too many people in work who do not earn enough to live on. Sometimes they don’t work enough hours, for example because their employer doesn’t offer them or because they have care responsibilities that mean they can’t work extra hours. But more often, people don’t earn enough to live on because they aren’t paid enough. The time they spend cleaning an office, caring for an elderly person, or serving lunch simply does not pay enough to cover the rent, bills and a few extras. So what can be done?

Pay the real Living Wage.

This hourly rate – currently £8.45 – is carefully calculated so that someone earning it and claiming any in-work benefits gains enough for a ‘modest but acceptable’ standard of living.  Unlike the spectacularly mis-named National Living Wage, it reflects the real cost of living and just as importantly it applies to young workers as well as older.

The number of employers in Wales accredited as Living Wage employers by the Living Wage Foundation is rising, and now stands at 114 compared with just 70 fifteen months ago. But before you get excited, compare that with Scotland where 1,004 – nearly ten times as many – employers are accredited.

The truth is that there needs to be a step-change in the number of employers – and hence employees – being paid the Living Wage in Wales.

5 steps towards a step change

We’ve identified five things that should be done to get the dramatic increase in Living Wage employers that Wales urgently needs.

1. Aim to increase the number paid the Living Wage by 6,000 a year

   There needs to be a specific, measurable and achievable target set by the Welsh Government which it then needs to translate into action. We have targets for just about everything else, from waiting times in A&E to numbers of affordable homes, and we need one for pay too.

2. A strategy for quick wins and for long-term change
   

   Many organisations who might be naturally sympathetic to paying their staff enough to live on simply don’t think about making sure that they actually do. Couple this with boosting productivity and wages in low-paying sectors like retail and hospitality, and there could be real progress.  After all, if Lidl and Ikea can do it then so too can Tesco and Asda.

3. Tactics that work

   The evidence shows that employer-to-employer messages work best. In other words, most employers won’t listen to people like me, but they will listen to the CEO of Freshwater, Capital Law or PHG consulting engineers. And they also work best when there is a critical mass of employers signed-up, so that it becomes good business practice rather than something weird.

4. Policy Levers

   Persuasion isn’t always enough – sometimes there needs to be policy and legislation to make employers do the decent thing.  Quite why organisations that receive hundreds of thousands of pounds of Welsh Government funding are allowed to get away with paying their staff poverty wages beats me.  Ministers hold these bodies to account for all kinds of minutiae of their service delivery and planning – but not their pay and conditions. It just needs a one-liner in their remit letters.

   And procurement could make a difference too – there is now the excellent ‘Code of Practice on Ethical Employment in Supply Chains‘ but the big questions is whether it is adhered to and policed.

5. Some investment

   Most employers don’t suddenly decide to pay the real Living Wage. They need to be aware of it, they need a nudge, they need support sometimes, and very occasionally they should be shamed. None of this happens by accidenty – we know from national campaigns such as in Scotland as well as local campaigns such as in Manchester that a bit of investment works wonders. So we have such a campaign in Wales? Not that parallels Scotland’s no.

And three things you can do

It’s not all down to the Welsh Government – here’s three things you can do:

• is your own employer an accredited Living Wage employer? No? Start a campaign at your workplace through your union if you have one or with colleagues if not.
• Are the staff at the place where you do your weekly shop paid the real Living Wage. No? Ask the manager or tweet them why not and threaten to shop at Lidl (unless you already do in which case tell them how great they are).
• Look at the map of Living Wage employers in Wales here – and start a local campaign for the many who do not pay enough to live on to up their game.

Victoria Winckler is Director of the Bevan Foundation – an accredited Living Wage employer. 

Read our guest article, written by Amy Wallace, one of Freshwater’s new interns, about how important it is to be paid the Living Wage.