Why Living Wage?

Why Living Wage?

The Living Wage rates for the UK and London are £7.65 and £8.80 per hour respectively, as announced by the Living Wage Foundation and the Mayor of London on 5 November 2013. This is more than the statutory National Minimum Wage, which is currently £6.19 for workers aged 21, and substantially less for young people. The Living Wage takes into account top-up benefits and credits which are often not enough to keep people out of poverty. For people who work hard full-time to be subject to poverty is a denial of the dignity that God has given them. The Living Wage is an idea that flows directly from Christian values, and has resonated throughout the secular world. A complex labour market which prices in supply and demand is a fact of modern societies. However, human endeavour cannot be a product bought and sold like any other commodity. It is morally unacceptable to price labour so low that people are forced to work long and hard yet still live in poverty. It is an indictment of the UK’s low -pay culture and the low level of the legally enforced Minimum Wage that 61% of children living in poverty actually have working parents.

 

For over 5 million people in the UK today 21% of the workforce hard work and poverty pay is their daily reality. Before the Methodist Church adopted the Living Wage, its internal research showed that many of these low-paid workers worked in Methodist churches as cleaners, office workers, gardeners and caretakers. There is good reason to believe the same will be true in other churches. Many of those on sub-Living Wage salaries also live in the most deprived communities, which we as a church are committed to as part of our mission.

 

Anecdotally, the experience of most churches when they ask the question “How much will it cost to pay the Living Wage” is that the answer is surprising low. It is surprisingly easy to be a low-pay employer without facing up to it or realising how little money it is saving. When the synod of the Diocese of Sheffield came to debate this issue 12 months ago, it was estimated that the financial cost would be in the region of only £3,600. Other systematic research by the Methodist Church research showed that the overall cost of Living Wage was relatively small, affecting only around one in six churches. These churches tended to be small and the jobs involved were typically the three-hour-a-week cleaner or the person doing occasional maintenance or gardening work; often these were people who were already doing other low-paid jobs and needed the extra money.

 

Employers are increasingly recognising the strong business case for paying the Living Wage. It makes people happier at work and more motivated, it reduces absenteeism, staff turnover goes down, and productivity is increased. We should by all means make the economic argument for paying a Living Wage but the bottom line is that we should do it because it is morally right. The Living Wage helps to clarify the difference between people whose work for the church is their livelihood and those for whom it is part of their voluntary commitment or vocation, making these boundaries less inappropriately blurred and less prone to forms of exploitation. But it is all of us, as tax-payers, who bear the cost of sub-Living Wage salaries. The Institute for Fiscal Studies estimates it mounts up to £6 billion a year in benefits and forgone revenue.

 

The Living Wage is not a party political issue it is endorsed by politicians as diverse as David Cameron, Boris Johnson, Ed Miliband and Alex Salmond. A range of large and small employers have already shown that the Living Wage is both affordable and makes sound business sense. This includes Barclays, PricewaterhouseCoopers, Lloyds of London, KPMG and Lush; and in the public sector, the Greater London Authority, at least 35 councils, 12 universities, and four hospitals. Public opinion polling shows four out of five people think the Minimum Wage is too low. The independent Centre for Research in Social Policy at Loughborough University conduct thorough and rigorous research to work out the Living Wage by calculating what is needed for an adequate standard of living. It involves in-depth surveying of a cross-section of society to discuss and agree what is needed for an adequate standard of living something that people feel nobody in Britain should fall below. The required wage to meet these costs for different household types is then calculated (assuming full-time work and claiming all relevant benefits or tax credits).

 

 

What can I do?

Ensure that your church pays a Living Wage to its entire staff.

You can use the resources at www.church-poverty.org.uk/livingwage to persuade others in your church that a Living Wage is important.

 

Keep it up to date. Just as the National Minimum Wage changes every October, the Living Wage will be updated every autumn. You can sign up to receive an update at

http://bit.ly/caplivingwage. We will email you each year to let you know the new rate.

 

Sign up as an official Living Wage Employer at  www.livingwage.org.uk/employers. You have to pay an annual fee of at least £50.

 

Find out more

If you have any questions about the Living Wage, please visit

www.church-poverty.org.uk/livingwage, or contact:

Liam Purcell, Church Action on Poverty, Dale House, 35 Dale Street, Manchester M1 2HF

liamp@church-poverty.org.uk

0161 236 9321

Author: Rev Jenny Mayo-Lythall

Date: 14 July 2014

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