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Heathrow becomes first airport signed up to Living Wage after rates rise

The Living Wage is a voluntary rate independently calculated from the National Living Wage, comprising what campaign creator Living Wage Foundation deems as the real cost of UK life. And with inflation putting pressure on households, the rate has increased once more.
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With 3,600 companies already signed up to the voluntary rate, numerous employees will see their wages rise to £8.75 an hour – £10.20 for those in London. Yet it hasn’t escaped Living Wage Foundation director Katherine Chapman’s attention that one in five workers are paid below this marker.

It’s her opinion that those receiving the National Living Wage – 5.5m people – will soon feel the squeeze, and laments that “in-work poverty is today’s story”.

The figure referenced by Chapman is courtesy of KPMG’s latest research, which found that the number of staff earning less than the voluntary rate has increased compared with five years ago. Not only that, female workers are feeling most of the burn, with one in four earning less than the Living Wage.

Some 3.1m part-time staff face the same dilemma. Those in Northern Ireland earn the least as well, followed by employees from the East Midlands and Wales.

The Equality Trusts’s executive director, Wanda Wyporska, said of the research: “It’s incredible to see so many of the UK’s largest businesses refuse to increase staff wages not only because it’s the fair thing to do, but also in light of oncoming financial struggles.

“It’s appalling when you consider the average pay for a FTSE 100 boss is now over 300 times that of a minimum wage worker.”

That a number of FTSE 100 companies have failed to hop on board the bandwagon is a point Wyporska strives to make. All in all, KPMG, Chapman and Wyporska alike indicate that too many facets of life, from transport to household goods, have steadily increased in cost for people to continue comfortably with the same amount of money.

“Great businesses know that even during tough times fair pay is the right thing to do,” Chapman stressed. “It also brings about big benefits, with nine out of ten accredited employers reporting improved retention, reputation, recruitment and staff motivation.”

It’s no surprise then that additional companies have signed on to give staff the voluntary rate since its new increase. Heathrow is one of them, joining the likes of Lush and IKEA, becoming the first airport to do so. This will see over 3,200 low-paid staff have their wages increased by £100 a week.

Heathrow is even going beyond the Living Wage Foundation’s requirements by phasing out zero-hours contracts, as well as requiring any company bidding for its commercial and supply chain contracts to disclose whether staff are receiving the Living Wage.

Speaking to The Guardian, London mayor Sadiq Khan, exclaimed: “London is one of the most dynamic and prosperous economies in the world, but unfortunately this prosperity isn’t shared by all. In the capital alone, over 2m people are struggling to make ends meet.”

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About Author

Shané Schutte

Shané Schutte is the deputy editor of Real Business, with a particular specialism in employment and business law, human resources, information technology and sales/marketing.

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