A significant proportion of workers at Scottish charities earn below the living wage

Scotland’s voluntary sector has a big problem with low wages, a new study shows.

A significant proportion of workers at Scottish charities earn below the living wage – leading to calls for employers to do better.

Research from the Living Wage Foundation (LWF) shows that low pay in the sector has not improved in five years, and it could get worse due to the effects of the Covid pandemic.

Its study found that a fifth (17%) of workers in the third sector throughout the UK earn below the living wage, amounting to 388,000 workers. 

And in Scotland, the figure is higher – with 18.4% of workers in the third sector paid below the living wage.

In this context, living wage is defined as the voluntary scheme whereby employers commit to paying £9.50 per hour for all over 18, as opposed to the Tory government’s re-badged ‘living wage’ of £8.91 for over-23s - and significantly less for those under – which is in reality a minimum wage.

Across the UK, the rate of low pay in the sector is the same as it was five years ago, despite low pay in the public and private sectors’ decreasing.

Low paid third sector workers are also more likely to have lost work through the pandemic, with half (48%) of low paid staff being ‘away from work’ (mainly due to furlough) during the height of the pandemic, compared to just 20% of those earning at or above the living wage.  

The sector is still coming to terms with the financial impact of the pandemic, with two thirds (63%) of organisations reporting increased demand over during Covid-19 and 83% projecting a decline in income, meaning things could get worse for low paid workers.   

Certain third sector workers faced a greater risk of earning less than the real living wage, with Scottish figures showing that 19% of women are paid below the rate, compared to 14% of men, while 20% of workers from what the LWF defines as racialised groups are paid below the living wage, compared to 17% of white workers.

And the disparities continue: 29% of part time workers earn below the living wage, compared to 10% of full-time workers while 20% of disabled workers earn below the rate, compared to 15% of those without a disability.  

For the sake of the study, the LWF defined the ‘third sector’ as comprising charities, universities, community interest companies, social enterprises and pressure groups.  

Peter Kelly, director of the Poverty Alliance said: "Too many workers in Scotland, including those in the third sector, are living in the grip of low-pay. The Scottish Government has announced a commitment to require all recipients of public sector grants to pay at least the real living wage by the summer of 2022.

“While this is a step towards creating a more just sector, the government and all grant funders have a vital role to play in enabling employers to pay their workers the real living wage. By becoming an accredited living wage employer, our community and the voluntary sector can help to ensure everyone in Scotland has enough to get by." 

Graham Griffiths, interim director of the Living Wage Foundation, added: “During Covid-19, the third sector has been a lifeline for millions of families across the country, providing them with everyday needs like food, clothes and educational equipment. 

“Our research shows that many of these workers have been providing these services despite earning below the living wage and being unable to afford them themselves.” 

“After more than a year of pandemic firefighting, the third sector has some time to think about how it rebuilds through and beyond Covid-19. To continue to provide essential services year-round and attract new people into the sector, providing workers with a real living wage must be at the heart of this process.”