Rising wages and fair pay: is your organisation doing enough?
The increase in the national living wage rate comes as employers are also being encouraged to get on board with paying the Real Living Wage. This is a voluntary rate of pay - calculated annually by the Resolution Foundation and overseen by the Living Wage Commission - based on actual living costs. It is applicable to workers aged 18 and over and is more than the new minimum wage rate, at £12 per hour. Businesses across the north such as Aviva, Everton Football Club, Leeds Trinity University, Northumbrian Water and York Minster are just some of the many organisations that have committed to paying the Real Living Wage. In 2022, Sunderland became the first city in the North East to be recognised for committing to becoming a Living Wage City. There are now 41 Living Wage employers headquartered in Sunderland, alongside 47 who have branches or district centres in Sunderland. Major employers based in the city such as the University of Sunderland and Gentoo are Real Living Wage employers, alongside City Council staff. Together this means that over 10,000 people working in the city now receive the Real Living Wage. Sam England, Head of HR at Gentoo, said: “We are proud to be accredited by the Living Wage Foundation and we are committed to making sure our colleagues have a better working life. With the cost-of-living it’s more important than ever to make sure we support our colleagues in this way.
Gentoo pay the Real Living Wage
In April 2024, almost three million low-paid workers will receive a pay rise of almost 10%, as the national living wage rate rises to £11.44 an hour. The government’s statutory minimum rate for all workers aged 23 and over will also be extended to workers aged 21 and 22 for the first time.
“In the North East 38% children are growing up in poverty. This is the highest rate of in- work poverty nationwide as many are from working families. The Real Living Wage is a step forward for organisations to positively impact those numbers. We would encourage all organisations to sign up to become an accredited Real Living Wage employer and help to improve working lives in the North East.”
Charles Cotton, Senior Policy Advisor, Performance & Reward at CIPD said: “Businesses in some sectors have called the rises unsustainable. But employers can prepare for paying higher salaries by exploring different ways to generate the money needed to pay a larger wage bill.”
In response to the rise in the national minimum wage rates in 2023, CIPD research revealed that the most common ways companies in the north managed the increase in wages was to: • take lower profits or accept higher overheads (31%) • raise prices (30%) • improve productivity (16%).
Faith Lydiard, Programme Manager - North East at the Living Wage Foundation adds: “Earning the real Living Wage makes a huge difference to workers, who have told us the difference it makes to their productivity at work, mental health and relationships.
Find out how to become a Real Living Wage employer here .
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REGIONAL INSIGHTS
Spring 2024
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