86% believe living wage accreditation improves employer reputation

More than three quarters (86%) of voluntary living wage accredited employer respondents believe that living wage accreditation has enhanced their organisation’s general reputation as an employer, according to research by the Living Wage Foundation and Cardiff Business School.

The survey of 800 organisations that have been accredited as a living wage employer by the Living Wage Foundation, including small to medium enterprises (SMEs) and FTSE 100 organisations, also found that 93% of respondents believe their business has benefited in some way since becoming a living wage employer.

The living wage is a voluntary rate that is calculated according to the basic cost of living. It currently stands at £8.45 an hour in the UK, and £9.75 an hour in London. It is distinct from the government’s national living wage, which is mandatory for staff aged 25 and over. This increased from £7.20 to £7.50 an hour on 1 April 2017.

The research also found:

  • 64% of respondents believe their living wage accreditation has differentiated their organisation from competitors in the same industry.
  • 58% of respondents find that having a living wage accreditation improves the relationship between staff and management, and 57% note an increase in commitment and motivation in staff who receive the voluntary living wage.
  • 53% of respondents state that recruitment into jobs that are covered by the living wage has improved.
  • 76% of respondents with more than 500 employees report improved retention of staff who receive the living wage, and 78% note an increase in staff motivation.
  • 81% of respondents do not find that having a living wage accreditation makes it more difficult to recruit for team leader or supervisory positions.
  • 75% of respondents in the retail sector report an increase in employee motivation since becoming a living wage accredited organisation, and 62% note an improvement in staff retention.

Katherine Chapman (pictured), director at the Living Wage Foundation, said: “Our 3,000-strong network of accredited living wage employers are going above and beyond the statutory minimum wage rates, ensuring the lowest paid members of staff earn a wage that’s enough to live on. This research demonstrates that paying the real living wage is not only the right thing to do, but it also makes good business sense.

“This research demonstrates to businesses who are able, that going above and beyond statutory minimums brings tangible benefits to an organisation. Just a year ago there was concern that the higher minimum wage rates for over 25s would see a slowdown in businesses accrediting as living wage employers. The reality has been sustained growth; doubling the number of accredited businesses from July 2015, with more responsible organisations sharing our vision that a hard day’s work deserves a fair day’s pay.”