By Katie Gerrard, I am Recruiting, Recruitment Manager – Charities
Here at I am recruiting, we pay the real Living Wage which is higher than the government minimum. The real Living Wage is the only UK wage rate that is voluntarily paid by over 5,000 UK businesses who believe their staff deserve a fair day’s pay for a hard day’s work.
According to the Charity Finance Group, a quarter of charity workers earn less than the real Living Wage. Whilst this may not come as a surprise, it’s an unfortunate situation for the not for profit sector which is blessed with dedicated, skilled, and knowledgeable staff.
In London, the living wage is a very significant £1.55 more than the rest of the UK. And with most of our clients being based within the inner London zones, we specifically look at whether a role meets the London Living Wage before deciding to recruit for it.
Having worked as an employability support on housing estates, I’ve seen first-hand the real difference going from a minimum wage to a London Living Wage makes for not just the wage earner but also their family and wider community. But there is more to paying well than simply staff wellbeing.
The rising cost of housing, transport, and food makes it difficult to attract candidates to lower paid roles but more importantly, it also makes retention rates a lot lower.
As a society when we talk about low pay, we often focus on the things we see – rising food bank use and the inability to afford luxuries, spiralling debt. The hidden effects are less discussed but of equal concern particularly for an organisation which values employee welfare.
Many people in low paid work don’t claim additional benefits, instead they take on additional jobs; for example, weekend stewarding or retail work, bar work in the evening, or perhaps admin type tasks they can complete in the evenings. This hidden workload makes it more difficult to concentrate within their main job and gives a faster burn out time making it harder to bounce back from ill health or stress. This ultimately affects efficiency and attendance and ultimately costs the organisation more.
Lower rents often result in insecure homes meaning the likelihood of moving due to external factors (property becoming uninhabitable, landlord selling up, rent rise) is heightened. Whilst this is frustrating and time consuming the biggest risk is your employee needing to move to a place where it’s no longer possible to commute into the office and they have no choice but change jobs. The cost of paying an employee the London Living Wage approved salary of just above £19K rather than £17K might seem outside of your budget but it’s ultimately cheaper than the associated recruitment and training costs of replacing those staff members.
Paying less than the living wage can create the risk of a less than diverse workforce in the same way unpaid internships and volunteering removes the first career path rung from candidates who are unsupported financially. A candidate with no external financial support will likely need to choose a role which pays better over their preferred choice of sector based on ethics and interest removing valuable skills and potential from not just the organisation but the future of the entire sector.
Signing up to be a Living Wage Employer is a great step to building stability within your organisation and retaining skills and knowledge. We’re proud to support Living Wage Week.
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