More than a quarter of people working for UK charities are not paid the living wage, compared to just a fifth of the rest of the population

Fewer charity workers are paid the real living wage than other sectors of society a new report reveals.

The Living Wage Foundation says 26% of charity workers aren’t paid the living wage, a voluntary rate that is calculated based on the cost of living in the UK.

Across the overall UK workforce, only 21% of people aren’t paid the living wage, which has just been increased from £8.45 an hour to £8.75.

The findings come in a new report released as part of Living Wage Week (5-11 November) and looks at the proportion of workers across the charity sector who are not paid the real Living Wage, further broken down by gender, ethnicity, age, full or part-time hours, size of charity, sector and region.

It reveals that nearly a third of women (30.4%) who work for charities do not get the living wage, compared to just a fifth of men (21%). Overall, almost three quarters (73%) of low-paid charity sector workers are women.

Whilst over 800 charities – such as Macmillan Cancer Support, Dementia UK, Carers UK and Crisis – are already accredited Living Wage Employers, the report launch has been accompanied by calls for more funders and commissioners to enable the real Living Wage by becoming Living Wage Friendly Funders.

Living Wage accredited charities ensure that all staff, regardless of whether they are direct employees or third-party contracted staff, receive the real living wage which is almost 17% higher than the national statutory minimum wage of £7.50 an hour.

Those earning less than the real Living Wage could be earning at least £2,400 less per year than their accredited Living Wage employer worker counterparts in the UK and £5,200 less annually for those in London.

Katherine Chapman, director of the Living Wage Foundation, said:“This report shows that low pay remains a real challenge across the charity sector, with stark revelations as to demographics of those most likely to be worst affected. A collaborative approach from thousands of charities and funders is needed, to ensure that those working for charities can earn a wage that meets the cost of living.”

The report also finds that people from BAME backgrounds are particularly affected by low pay, with a staggering 62% of people who identify as other Asian background reporting that they earn below the Living Wage.

To even contemplate ending low pay in the charity sector, not only do we need charities to work towards paying their staff a real Living Wage, but we need funders and commissioners to commit to paying the real Living Wage - John Hume

Charity workers below the age of 25 are much more likely to experience low pay, with more than half (52.4%) of those between 20 and 24 earning below the real Living Wage, although this does compare favourably with the workforce as a whole (58.4%).

Part-time workers are more likely to be affected by low pay (42.7%) compared to just under a fifth (19%) of full-time workers in the charity sector.

Smaller charities are more likely to pay below the Living Wage, with majority of low paid employees (77.2%) working for charities with less than 50 employees; higher than in the wider economy (62.3%).

There are now 31 Living Wage Friendly Funders promoting Living Wage through their grant-making, including People’s Health Trust, Trust for London, Barrow Cadbury, the Joseph Rowntree Foundation, Comic Relief, the London Borough of Islington, the Big Lottery Fund, City Bridge Trust and Lloyds Bank Foundation.

John Hume, chief executive of the People’s Health Trust, said: “To even contemplate ending low pay in the charity sector, not only do we need charities to work towards paying their staff a real Living Wage, but we need funders and commissioners to commit to paying the real Living Wage through grants and contracts they award to charities.

“It is not always an easy conversation to have. With an increasingly uncertain economic climate, we know many are operating with ever-tighter budgets, but we still need to act. We need to work together, and do right by our workers, ensuring all charities reliant on their grants are able to pay the real Living Wage.”

A recent Scottish Government announcement that all third sector social care staff in Scotland will be paid the living wage for all hours worked, including sleepovers, was met with anger from social care charities. They said local and national government funders were not doing enough to fund their commitment to the higher salary.

Last week, further research on pay in the third sector uncovered that Scottish charity workers are paid the worst in the UK at an average £28,420.