A Fair Days Pay For a Fair Days Work
In my first few months in office, I made the North of Tyne an accredited Living Wage employer. We’re a small organisation, mainly highly skilled workers already on more than £9.30 an hour. But it did affect the cleaners, receptionists and security staff who maintain the building. We also have a gender pay gap of zero – the men and the women get the same median pay. It was another manifesto pledge, and we’re rattling through delivering them, despite the extreme disruption caused by Covid. Living Wage Week 2020 starts today (9th Nov). It celebrates the 6,500 UK employers UK who do the right thing pay their workers the Real Living Wage. For 2019/20, the Real Living Wage was £9.30 per hour. Next year’s figure is out soon. The amount is calculated on what people actually need to live on, without falling into debt. It accounts for food, clothes, bills, transport and housing. Compare it to the legal minimum wage of £8.21 for the same period, and you can see it makes a huge difference to the low paid. It was an act of deception when the government renamed the minimum wage the “National Living Wage” – it’s not. Which is why we still need the Living Wage Foundation to look at the reality of living with low pay. The Real Living Wage applies to all workers, even those under 25. Under the minimum wage, they can legally be paid as little as £4.55 an hour. People should be paid for the work they do, not discriminated against because of their age.
Everyone should be paid enough to live decently and provide for their family. No-one should experience the indignity of in-work poverty or low wage exploitation. Yet 21% of all workers across the UK, including 60,000 in the North of Tyne, are still paid less than the £9.30 per hour. It’s a false economy – it causes hardship, and is directly correlated to health problems and educational entertainment. Public services then have to pick up the strain. Low pay affects us all.
There’s an indelible moral case for paying the Real Living Wage. But there’s also a sound economic case. Good employers have realized that paying the Real Living Wage is good for business. In 2017, The Living Wage Foundation surveyed 800 employers who had signed up. An amazing 93% reported their business had benefited from paying higher wages. Increased motivation, lower days off sick, and higher staff retention were all good for productivity. Many of our local employers have realized this and have signed up. There are now 59 accredited employers representing over 33,000 employees across North of Tyne area. And I’d like to give a special mention to Sunderland City Council, who’ve joined us as an accredited Living Wage Employer – no mean feat, given the brutal assault on local government finance.
This week we’re also launching the North of Tyne Good Work Pledge. To qualify, employers have to demonstrate they’re not using exploitative contracts, they’re paying the Real Living Wage, they look after their staff wellbeing, have career development opportunities, and engage with their workers, including recognising trade unions. We’ll be linking this to public sector procurement so that companies wanting to bid for work will need to be good employers.
Decent pay is also good news for the local economy. When billionaires get a 10% income increase, it ends up in tax havens. Give an ordinary worker a 10% pay increase, and they decorate the back bedroom, or go out to a gig at a local venue. Their spending creates jobs for local people. Received wisdom says that internet shopping is killing our high streets. That’s undoubtedly a factor. But too few people have any money left after paying bills and debts. Zero hours contracts are a third higher in the North East than the UK average. Low paid and part-time workers are five times more likely than other workers to be furloughed on reduced pay. I’ve lobbied hard to have a floor on furlough – so no one gets less than minimum wage. People simply can’t get by on 80% of £8.72 an hour.
A fair day’s pay for a fair day’s work. That’s not too much to ask is it?
Originally published in the Journal and Evening Chronicle 9.11.20