One In Five 'Paid Less Than Living Wage'

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Nearly five millions British workers are being paid less that what is required for a basic standard of living, according to a new study.



It found 4.82 million people are being paid below the Living Wage, a pay packet which enables the basic standard of living.

The rate currently stands at £8.30 an hour in London and £7.20 in the rest of the UK.

It is a voluntary rate, unlike the National Minimum Wage - the amount that employers must pay by law - which is set at £6.19 an hour for those aged 21 and over.

Accountants KPMG, which carried out the study, said lower paid workers are feeling the impact hardest, with more than four in 10 (41%) saying that their finances are worse now than they were just one month ago.

Marianne Fallon, head of corporate affairs at KPMG, which has itself signed up to pay the Living Wage, said: "Times are difficult for many people, but of course those on the lowest pay are suffering the most."

She added: "Tackling in-work poverty is vital if we are to enable more people to improve their life prospects and increase social mobility in this country."

The report revealed workers in the hospitality industry are the worst affected, with 90% of bar staff paid lower than the living wage.

Furthermore, three quarters (75%) of kitchen and catering assistants, as well as launderers and dry cleaners, were paid less than the living wage.

Rhys Moore, director of the Living Wage Foundation, said: "Paying a Living Wage makes a huge difference to the quality of life of thousands of cleaners, caterers and security staff across the country.

"It is really encouraging to see nearly 100 organisations now signed up and accredited, but that still leaves many more organisations that aren’t."

The report suggested that Northern Ireland had the highest proportion of people earning below the Living Wage, at 24% of workers, followed by Wales at 23%.

The lowest levels were in London and the South East of England, both at 16%.

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‘An idea whose time has come’

- PM David Cameron, May 2010

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Ed Miliband exclusive: 'We'd name and shame low-payers'



Major companies who do not pay their staff a "living wage" of at least £7.20 an hour would be named and shamed under plans being considered by Ed Miliband, the Labour leader tells The Independent on Sunday today.

A Labour government could also introduce rules to award Whitehall contracts to firms who pay workers above the living wage – the minimum hourly rate needed for an acceptable standard of living, he added.

Mr Miliband, in an exclusive interview with The IoS, said the living wage was a central part of his "One Nation" vision to "share prosperity". One in five workers is paid below the living wage, the vast majority in catering, cleaning and retail.

Labour's policy review is looking at three ways in which the living wage, currently £7.20 an hour outside London and £8.30 an hour in the capital, can be introduced by employers in both the public and private sectors:

• Listed companies would be required to sign up to new corporate governance rules stating they paid the living wage, exposing those who did not. Small and medium businesses would be exempt.

• Central government would use powers of procurement to give preferential treatment to contractors who paid the living wage. Some 19 local authorities are already doing this.

• Firms could also be incentivised by receiving money back from the Treasury. The Institute for Fiscal Studies estimates that for every person moved on to the living wage, the Treasury would save around £1,000 from less spending on tax credits and from increased tax revenue.

A number of major firms, including City giants KPMG and Barclays, already pay workers and contractors such as cleaners and catering staff a living wage or higher, while 19 local authorities have been accredited as "living wage employers".

Tomorrow marks the start of Living Wage Week, when details are unveiled of new rates, and firms and councils that are accredited employers.

Read more: http://www.independent.co.uk/news/peopl ... 80627.html

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Coventry City Council rules out 'living wage' pay rise for low paid staff

THOUSANDS of low paid Coventry City Council staff will not get a ‘living wage’ pay increase in the next financial year, say leaders.

But ruling Labour councillors have set up a taskforce to examine the idea for future years.

At least 11 other Labour councils and other public bodies have already introduced one, with more being accredited.

Coventry councillors in favour say the council should lead by example as the city’s largest employer.

The Living Wage campaign urges employers to voluntarily raise the minimum wage they pay staff to £7.45 per hour outside London.

That is above the statutory National Minimum Wage of £6.19 per hour.

In councils, the Living Wage – intended to cover the actual cost of living – helps the lowest paid staff including care workers, cleaners and dinner ladies.

Coventry City Council’s lowest pay rate is £6.38 an hour.

No staff have received any pay rise since 2009. A one per cent pay increase is expected in 2013/14. It has about 2,000 employees and 700 casual staff earning less than £7.60 – among a reduced workforce now standing at 14,000 staff (including 6,700 in schools).

Deputy council leader George Duggins said introducing the Living Wage for directly employed council staff alone would cost the council £700,000.

He pointed to other potential problems, including complying with the Living Wage campaign’s commitment that employers should seek to persuade its contracted firms to pay it too.

He said that could also be problematic when the council and neighbouring councils held joint contracts with private firms.

Coun Duggins said: “We are looking at it. It’s an issue that’s come to the fore in recent times, particularly because of the way people’s pay has been affected, which has been hard on people at the lower end of the scale.

“It’s not as straightforward as some believe. There are cost implications for the council and we are brassic.

“I decided I would chair a group of interested Labour councillors. We are still deliberating and we will come to a conclusion about what to do. I don’t anticipate it being in time for the budget this year (the 2013/14 budget starting in April, to be set next month).

“The budget is a mammoth task, as important as this issue is in terms of morale and fairness.

“It’s not just about implementing £7.45 as a Living Wage. It’s also about the influence we may be able to have on the procurement process.”

Labour councillor Ed Ruane, who is sitting on the taskforce, said: “It is our duty to spearhead the living wage and lead by example, as similar big city authorities are already doing such as Birmingham, Newcastle, Glasgow.

“I’m hoping that companies in Coventry and Warwickshire will follow suit, as the living wage makes a real difference to the lives of low-paid workers, allowing them to make more of the choices that many of us take for granted.”