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Many employers still not paying living wage

This news post is about 8 years old

Significant number of workers not getting the living wage, research finds

Thousands of employees are still not being paid the living wage in Scotland, new research reveals.

More than 400,000 workers are not being paid the figure according to a study by auditors KPMG.

The living wage increased by 20p to £7.85 an hour this week while the minimum wage remains at £6.50.

Campaigners made the announcement as part of Living Wage Week which runs from 2 to 8 November.

During the week, The Living Wage Campaign hopes to encourage more employers in Scotland to deliver the £7.85 hourly figure and will run a series of events across the country highlighting the benefits of paying the wage.

Most below of those not earning the living wage work in the retail, catering and care sectors.

In the past year Scottish-based organisations including Standard Life, RBS and the SECC have all signed up to become accredited employers.

And Hearts became the first Scottish football club to enforce the living wage.

However according to KPMG some firms have said they cannot afford to pay it.

KPMG spokeswoman Margaret Butler said: "The research identifies statistics and trends, but it also reports the concerns of people earning below the living wage who expect their finances to worsen during the next 12 months and shows that debt levels have continued to rise among this group.

The living wage may not be possible for every business, but is certainly possible as well as enlightening to explore the feasibility of paying it

"Unless wages rise, a significant sector of the Scottish population will see themselves caught between the desire to contribute to society and the inability to afford to do so."

Butler added: "Business benefits of the living wage include higher staff retention and productivity, and nearly 60 responsible businesses in Scotland such as SSE and Glasgow Caledonian University recognise this.

"The living wage may not be possible for every business, but is certainly possible as well as enlightening to explore the feasibility of paying it."

The government is funding a pilot by the Poverty Alliance over the next year to promote take up of the living wage and increase the number of employers paying it.

Director of the Poverty Alliance, Peter Kelly, said: "The living wage in Scotland is now gaining genuine momentum with employers - the number of employers paying it here has tripled from 20 to 60 in the last six months.

"But there is no room for complacency. Low pay and in-work poverty is one of the main causes of child poverty in Scotland, so we need to build on the good work that has already been done.

The Living Wage Foundation said the new £7.85 rate "reflects the real cost of living, rewarding a hard day's work with a fair day's pay".

Director Rhys Moore said: "Low pay costs the taxpayer money - firms that pay the minimum wage are seeing their workers' pay topped up through the benefits system.

"So it's right that we recognise and celebrate those employers who are voluntarily signing up to the higher living wage, and saving the taxpayer money in the process."

Scottish Government Finance Secretary John Swinney MSP said: "We are firmly of the view that employers should reward their staff fairly, which is why all public sector staff under our direct control receive at least the Scottish Living Wage rate and will do for the duration of this parliament."



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