Above: graphs from the IPPR report ‘No Longer Managing’, showing increases in the likelihood of poverty in working households and the dramatic rise in housing costs for poor households since 1996.
Greater Manchester Law Centre (GMLC) Campaigns Officer Kate Bradley weighs up the benefits of Living Wage Week.
From 15-21 November, many organisations celebrate ‘Living Wage Week’ with events to discuss issues affecting low-income workers, raise the profile of the Real Living Wage, encourage employers to begin to pay a Real Living Wage, and celebrate those who do.
In order to qualify as paying the Real Living Wage in 2021, employers must now pay £9.90 an hour to their staff (£11.05 in London). The Real Living Wage is distinguishable from the National Living Wage following a rather disingenuous government rebrand of the adult-level minimum wage in 2016. Relabelling the minimum wage had the effect of confusing many people into believing employers were now obliged to pay wages that are liveable as according to the Living Wage Foundation, a respected authority on the matter. However, the Real Living Wage is higher and doesn’t distinguish in the same way between different ages of worker.
The Living Wage Foundation do admirable work to persuade employers of the benefits of getting accredited as a Real Living Wage employer. Many employers say they benefit from paying the Real Living Wage in terms of staff retention and relations. But it is notable that even employers admit that the main benefit is to their reputation, and in “differentiating themselves from others in their industry”.
One of the things that has been lost from HR training and Good Employer-type schemes is the old Industrial Relations common sense that employers and employees often have different interests, and pretending our interests are always the same can do more harm than good. The gentle coaxing of employers to pay workers a decent wage can lead to the needs of workers being glossed over. Where employees are encouraged to rely on employers’ charity, they can be disempowered from standing up for themselves when their employer doesn’t actually deliver, or when pay cuts or redundancies are made. In this sense, there is no replacement for trade unions and enforceable legal and policy changes to provide better employment rights and standards.
Real-terms wages continue to be wildly outpaced by living costs. In a report released earlier this year, the IPPR show that working poverty has risen at the same time as record employment rates, citing spiralling rental costs for tenants and care-giving duties as a cause of poverty for working households, as well as under-employment (where workers are in jobs but want to take on additional hours). In that light, the Real Living Wage can seem like a modest demand.
There are also issues with how the Real Living Wage is calculated and accredited. In many cases, it is people with children or relatives they care for, often women who still shoulder the majority of care-giving duties and generally get lower pay than men, who have no choice to work part-time and therefore do not receive a liveable wage. They are often left to navigate the benefits system alone, complete with all its sanctions, delays and confusions. Yet a Manchester-based employer paying £9.90 per hour to their zero-hours contracts or part-time staff who can’t afford their rent could proudly wear their badge for the sought-after reputational boost.
The Living Wage Foundation admits that accreditation does not include any specific requirements on contract types, but it says that it will not accredit if it has concerns about exploitative employment practices. However, it’s not clear how these would get picked up in its processes. It is discouraging that its website still displays Brewdog as a success story, despite prominent complaints about the “toxic”, high-pressure working environment which came out this year. £9.90 an hour would be very little consolation in a bullying or highly stressful working environment, especially if you were working unpaid overtime, as many workers do.
So how should we shift the conversation around the living wage?
If we talked about a Real Living Wage in yearly terms, we might find that ‘Living Wage Employers’ have a lot of employees who are earning far less than they need to survive. Something similar has been proposed by the Joseph Rowntree Foundation, who suggest an annual Minimum Income Standard that is flexible based on childcare costs and household type.
At GMLC, we provide free advice and representation to people with employment, welfare and housing issues, which often interact to produce hardship. For example, take Graham: the loss of his job at the start of Covid pandemic led to him having to claim Universal Credit. Subject to their delays, he could not pay his rent, and was issued a Section 21 Notice by his landlord, which could have made him homeless. Low income has a domino effect on the key pillars of a stable life.
Due to policy changes, such as cuts to legal aid, diminishing employment rights and restrictions on trade unions, we’re in an exceptionally poor era for actually enforcing workers’ rights. As a result, we can sometimes be limited to merely asking employers to give their workers better pay and conditions. That’s why it’s so important that the way we talk about a Real Living Wage is accurate and well-conceived – and not present it simply as a way for employers to boost their PR.
One excellent example of Living Wage Week being used to its full advantage could be seen this year at the Sage Nursing Home in London, where a protracted period of negotiation and intermittent strike action has finally led to all care workers, domestic and maintenance staff being promised the London Living Wage. The workers were organised in the trade union United Voices of the World (UVW). Here, the Real Living Wage campaign was put to great use, combining its aims with workplace organisation and pressure that will make it much harder for the employers to take it back, or use it for PR alone without paying attention to employees’ actual working conditions.
Effective measures are needed to improve pay and conditions at work in the UK today. We should be encouraging trade union membership, boosting employees’ protections in law, and arguing for widened access to justice to enforce those rights. The Real Living Wage is worth pushing for, but it’s far from the whole fight.
Greater Manchester Law Centre runs an employment service to provide advice and guidance on employment rights and law queries. You can get in touch with us by phone on 0161 769 2244 or by emailing us at reception@gmlaw.org.uk.
If you are a member of a trade union, you may have access to legal advice as part of your union membership, so we recommend you begin by seeking out advice or guidance from your union representative or legal services. We prioritise enquiries from Greater Manchester residents for whom advice is not already available through their trade union.
