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Who pays the Living Wage?
BBC Scotland Investigates asked fifty of Scotland’s biggest employers about the living wage, set at £7.85 an hour. The majority told the BBC they either did not pay all staff the living wage, or would not say. Only ten companies responded in a way that suggests their pay policy is in line with the Living Wage Foundation’s definition of a Living Wage employer.
Around 200 organisations in Scotland are accredited by the Living Wage Foundation. The team also established that most Premiership football clubs are paying some of their off-pitch staff less than the living wage.
Poverty campaigners say this is totally unacceptable.
Some of the biggest fifty companies said they had other benefits for staff like discount cards and share schemes and made clear that they pay at least the minimum wage — the legal minimum of £6.50.
Football Clubs objected to football being singled out in the Living Wage debate and said they did community and charity work.
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Low Pay for Life
BBC Scotland Investigates: BBC One Scotland at 20:30 on Monday 18 May
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Biggest employers ‘not paying living wage’
BBC News story
Here are the responses from the employers:-
Fully compliant Living Wage Employer under the terms agreed by the Living Wage Foundation
| Company | Statement, if provided |
|---|---|
| RBS Group | Yes as an accredited Living Wage employer we have a timetable in place for all relevant contracted staff to move to the Living Wage. This will be done on a rolling basis as contracts come up for renewal and it is expected this will be complete within two to three years. This approach was agreed with the Living Wage Foundation and aligns with their phased accreditation guidelines. Progress will be monitored regularly by the Foundation. |
| John Wood Group | |
| Standard Life | |
| SSE | |
| Scottish Water | Scottish Water is committed to playing its part in supporting Scotland’s future prosperity with its workforce and suppliers investing £500 million investing in Scotland water infrastructure across the whole of the country every year. Our 3,600 staff enjoy excellent working conditions and all employment benefits in line with statutory legislation from the Scottish Parliament. We ensure that all agency staff are paid at least the Scottish Living Wage by their employers. Staff working under the majority of contracts where we engage a third party or partner company to provide a service, are also paid at or above the living wage. Some of our long-term service contracts in areas such as catering, cleaning or grounds maintenance do not currently insist that their employees are paid the living wage and as a result, there will be individuals paid below this level. As our existing contracts for the procurement of services come up for re-tendering, we will explore ways in which the living wage may be stipulated within new contract terms. |
| HSBC | HSBC became formally accredited as a Living Wage employer in July 2014. We pay all our directly employed staff the living wage, and also all indirectly employed staff (including those working for contractors) who regularly work for our company or on our premises. |
| Schlumberger | UK Schlumberger pays all directly employed staff, indirectly employed staff and contractors rates equal to or above the living wage. |
| Barclays Bank | |
| Santander | Plans have been agreed with our sub-contracted companies to include the Living Wage when the relevant contract is up for renewal. |
| Aviva / Norwich Union | Aviva is a UK Living Wage accredited employer and as such is committed to paying all indirectly employed and contractor staff who work on Aviva premises the Living Wage. We are working towards ensuring all indirectly employed and contractor staff working on Aviva premises are paid the Living Wage by the end of this year. |
Not a Living Wage Employer under the terms agreed by the Living Wage Foundation
| Company | Statement, if provided |
|---|---|
| Wm Morrison | We pay our supermarket sales assistants more than the minimum wage and will continue to review our headline retail rates with our colleagues and unions on an annual basis. Our sales assistants (along with other colleagues) can participate in a wide range of benefits, which combined with basic rates of pay, equates to more than the Living Wage. |
| Cooperative Group | The Group is committed to ensuring that its employee total reward package is broadly in line with market practice and is sustainable by business performance. The Group has been supportive of the principle of a statutory floor for basic pay and supported the introduction of a National Minimum Wage (NMW). However, the Group believes the Living Wage calculations need to be broader, as its reward package includes more than just basic pay, and that other elements of the reward package should be taken into account. |
| FirstGroup | At First Glasgow, we take our responsibility as Scotland’s biggest bus company seriously. We are the 39th largest employer in the country with over 2,400 members of staff. All our drivers earn above the living wage, we have a strong number of apprentices on board and we are proud to be helping people back to work, including long term unemployed and ex-service personnel, through the Glasgow Guarantee job scheme. We have installed ‘Workplace Learning Centres’ in all our sites where staff can develop and learn new skills from information technology to literacy and numeracy and we’re proud to also be supporting the pensions of a further 3,000 people on top of our existing employees. We are at present addressing a very small number of employees who are paid a rate marginally below the living wage and we will shortly be having those discussions formally with our Union. This has been due to historical differences in businesses acquired and we anticipate this being resolved in a matter of months. |
| BT Scotland | It is our people who make the difference for our customers so we want to attract and to keep the best. An important part of this is paying our people well and our wage rates are very competitive. So our strategy is to calibrate our remuneration structures appropriately; typically, these will be at levels consistent with, or more than, the “Living Wage”. We meet all of our statutory obligations and we offer attractive terms and conditions of employment to our staff, including additional benefits, for example, pensions. For the majority of our UK employees we negotiate our terms and conditions on a national basis with our trade union partners - the Communication Workers Union (CWU) and the Prospect trade union; and all pay rates under these agreements are above the ‘Living Wage’. If we identify areas of the business where prevailing rates are below the “Living Wage” levels e.g. if people join the company on lower levels of pay, for example, through an acquisition or contract win, then we will develop an appropriate transition plan to bring rates more into line with our remuneration structure. In addition to our base pay and pension plans, all of our UK employees can participate in broader remuneration arrangements, such as our employee share savings plans. BT’s employee share plans have amongst the highest participation rates in the country and they have delivered significant value to employees. However, we have not signed-up to the “Living Wage” campaign as we believe it is important that businesses retain the responsibility to set their own terms and conditions of employment. In terms of our third-party contracting arrangements, we only work with reputable partners. We check that our agencies and suppliers pay in line with best practice; this enables them to attract good people. We do not believe that it is appropriate for us to mandate pay levels in other organisations; businesses must be able to set their own rates at levels that enable them to attract and retain staff and to provide employment opportunities whilst meeting their legal obligations. |
| Arnold Clark Automobiles | The Arnold Clark Organisation is on track to achieve the living wage for all staff in the near future. As of April 1st this year, our minimum wage is £7.25 per hour (significantly ahead of the industry average and 11% above minimum wage). We support any moves to make the living wage a statutory obligation in the UK. |
| Marks & Spencer | M&S continues to be one of the top payers on the high street. We offer our colleagues great career opportunities and have one of the lowest turnover rates in the retail sector. The basic training rate for customer assistants at Marks & Spencer stores is £6.79 per hour; This increases to £7.26 after training is complete (maximum of 26 weeks). The majority of customer assistants have completed the training and earn the higher rate of pay; In addition, benefits include a generous pension, 20 per cent M&S discount card, additional paid days for volunteering and the opportunity to join a share save scheme plus free uniforms/ subsidised meals. This is in addition to a wider range of lifestyle benefits such as discounted gym memberships and a salary sacrifice scheme offering access to a bikes 4 work scheme and PCs for home. |
| Amec Group Scotland | We are almost at 100% with UK direct employees and have been/are in discussion with our supply chain on indirect workers. I should like to highlight that our Global HR Director met with the UK Living Wage Foundation to better understand the situation and we are making further progress. |
| Diageo Scotland | Diageo pays above the Living Wage rate to its permanent directly employed staff in Scotland and across the rest of the UK. There are a small number of exceptions to this, principally first year apprentices who remain in college education before beginning their full-time work and in the tourist sector where there are many part-time and temporary roles. Many but not all indirectly employed staff working at our sites are paid above the Living Wage. Our contractors provide a valued service and third party companies set their pay rates according to the statutory Minimum Wage regulations and competitive local job market conditions. It is a matter for Government to set the level of the Minimum Wage and we of course abide by all our statutory obligations. |
| Whitbread | |
| Capita Group | The majority of Capita employees are in roles remunerated above the Living Wage. With over 60,000 employees across the UK, Capita ensures that it complies with the national minimum wage legislation and pays salaries equivalent to local rates. Capita continuously reviews salary levels across the group. |
| Stagecoach Group | Some 95% of our employees in Scotland are paid above the living wage, with others being paid above the minimum wage. We do not directly control the wage policies of external organisations. However, in some cases we have ensured staff working for third party suppliers are paid above the minimum wage as part of the contract with us. We will continue to offer attractive packages for our people, which also includes access to good pension arrangements, employer share plans and other benefits. ? We do not directly control the wage policies of external organisations. However, we will continue to ensure where possible that staff working for third party suppliers are paid above the minimum wage as part of the contract with us. |
| Kingfisher | Kingfisher companies pay all its employees above the National Minimum Wage and we welcome a debate about how the lowest paid in society can be helped further. However we do not support the Living Wage. We are concerned that it would create an alternative pay floor without the established rigour and discipline of the NMW, and without taking into account the wider employment benefits employees receive. A Living Wage would have a major impact on businesses’ core costs which would reduce their ability to create more jobs, may threaten existing popular employee benefits, could put greater pressure on supply chains to drive down their employee costs and could lead to more expensive prices for consumers, impacting peoples’ cost of living. Rather than undermine the National Minimum Wage, we would support a wider review considering all routes to support the lowest paid in society. |
| John Lewis Partnership | The majority of our Partners earn more than the Living Wage including Partnership bonus. Our pay policy is 'to pay the market rate for good performance and any amount above that can be justified by performance', supported by skills development, a competitive total rewards package and profit sharing as an employee-owned business. Our pay ranges start from a market base and typically extend further than those in many of our competitors, and then overtime can be earned on top. As part of our total reward package, we provide a market leading pension scheme, exclusive use of holiday centres, leisure subsidies, shop discounts and an annual profit share bonus which averages 15% of base pay. We do not believe it is right for us to insist our suppliers or managing agents adopt pay policies that are different to our own by setting base pay levels well above the market rate. Fair pay is one of the core principles of the John Lewis Partnership and we share the Living Wage campaign’s objectives to pay employees fairly. We achieve that, however, through different means. Although we share the campaign’s objectives of fair pay and earning a wage you can live on, we don't believe the method of raising the ’pay floor’ well above the National Minimum Wage (NMW) is the right way to achieve that outcome. Within the Partnership, our pay policy is 'to pay the market rate for good performance and any amount above that can be justified by performance', supported by skills development, a competitive total rewards package and profit sharing as an employee-owned business. We do not believe it is right for us to insist our suppliers or managing agents adopt pay policies that are different to our own by setting base pay levels well above the market rate. |
Not fully compliant with the Living Wage Foundation. Pays directly employed staff Living Wage but not contractors.
| Company | Statement, if provided |
|---|---|
| Lloyds Banking Group | We are in discussions with the Living Wage Foundation and our third parties with the intention of becoming a Living Wage Employer. We currently pay our employees above the living wage requirements. At Lloyds Banking Group our Reward teams regularly monitor and benchmark our pay and benefits position to ensure consistency and appropriateness across the organisation. We have four trade unions that are recognised for collective bargaining and with whom we negotiate annual pay reviews and other significant changes in our reward arrangements. We believe our remuneration is appropriately set for all roles across Lloyds Banking Group. |
| bSkyb | Our third party suppliers pay what they believe to be appropriate in line with the market and the law. We focus on our own employees but we encourage our third party suppliers to pay the Living Wage. |
| Scottish Power | All of our directly employed staff are paid the living wage. Across all of our business areas we work with a wide range of contracting companies, across a variety of sectors. We recently launched a review across our contractor base to fully understand all remuneration contract structures. |
| Cordia Services | Cordia is one of Glasgow City Council’s arm’s length external organisations; which we tend to call Aleos. GCC was the first local authority in Scotland to pay a Living Wage and we work with other employers in the city to encourage them to do the same – as a result, around 130 city employers with more than 60,000 staff are now Glasgow Living Wage employers. The Council also requires all parts of the wider council family, such as Cordia and its other Aleos, to pay their staff the Glasgow Living Wage. In terms of contractors, the council has lobbied government to allow us to make payment of the Living Wage a condition in the tender process, as we don’t believe public money should support poverty pay. However, all efforts to date have been rebuffed. Instead, we have created a procurement policy designed to reward companies that demonstrate they offer real community benefits. Tackling in-work poverty (through payment of a Living Wage, not using exploitative zero hours contracts and providing staff with employment and training opportunities) would be an example. |
| Babcock International Group | We pay all our directly employed staff the living wage. We review salaries annually against the living wage and should any employee have fallen below this level during the year we will address this as a priority through our review process. During training, apprentices receive incremental wage awards so that on completion of their training they are paid at the appropriate level for their trade. This will be above the living wage. |
| Centrica/British Gas | We are pleased to have paid the Living Wage to our employees since January 2014. However, it is a more complex process to pay the Living Wage to all our contractors because of the extensive nature of our supply chain. It may be something we undertake in the future. |
| Clydesdale Bank | We have a firm commitment to pay at least the living wage to all direct employees. The commitment is reviewed annually with UNITE. We support payment of at least the living wage for our staff and will always comply with our statutory obligations. |
Did not answer the questions directly and their statement suggests they are at least partially compliant
| Company | Statement, if provided |
|---|---|
| BAE Systems | BAE Systems continues to pay its employees in the UK salaries above and no less than the level of the 'Living Wage' rates in the UK (as revised in 2014) |
Did not answer the questions directly and their position cannot be interpreted from their statement
| Company | Statement, if provided |
|---|---|
| Tesco | We pay one of the highest hourly rates in the industry, on average between 4 and 7% more than our major competitors. This is one aspect of our reward package which includes a colleague discount card, shares scheme & pension. The Living Wage only recognises basic pay, but our reward package is much broader than that. |
| Sainsbury's | As a responsible employer we know that rewarding our colleagues properly is an essential part of being a great place to work. Our basic pay rate is well above the National Minimum Wage and in addition to pay, colleagues can benefit from bonus, discount card, matched pension contributions and life insurance, share purchase schemes and paid breaks. Offering a comprehensive reward package is highly valued by our colleagues and goes way beyond simply paying an hourly rate which is the focus of the Living Wage campaign. We are proud of the fact that 14,000 people have worked for us for 20 years or more. We are aiming for this to reach 20,000 by the end of the decade. |
| McDonald's Restaurants | In Scotland, just like across the UK, all of our employees are paid above minimum wage, are on permanent contracts and are entitled to holiday and sick pay, stakeholder pension scheme and a competitive range of employee discounts and benefits. Every member of staff receives an annual pay review, where increases of up to 4.5% are available for staff at all levels. Alongside this range of entitlements, we invest over £40m a year in training and qualifications for our people, giving them the opportunity to develop and progress their career. |
| Boots | At Boots UK, we are committed to rewarding our colleagues fairly through base pay, and as a responsible employer, offer holiday and sick pay, bonus schemes, pension schemes and other benefits. We are continuing to keep very close to this both for Scotland and the rest of the UK, however it is too early to comment. |
| Next | All store staff at NEXT are paid above the minimum wage and additionally they can also receive a significant bonus, depending on performance. The basic pay is further enhanced by a generous staff discount scheme – all of which means NEXT receives more than thirty applications for every store vacancy. The whole concept of what constitutes ‘a Living Wage’ is very individual specific – varying widely from one person to another. For instance, the financial needs of a student, living at home and who only wants part-time work so as to fit around studies – is vastly different from those who are supporting a family. |
| Home Retail Group | Argos supports the Low Pay Commission and National Minimum Wage as we believe in a minimum level for decent wages for working people. Our staff have a package of benefits - base pay, paid holiday leave, staff discounts and we invest in training to help career progression. |
| Greggs | Greggs is a responsible employer and even our lowest earners are paid several per cent more than the minimum wage. Furthermore, all employees with more than six months' service receive a share of 10% of our annual profits. As you'd expect from any major employer, we take our responsibilities to our people very seriously and regularly review wages to ensure that we remain competitive in the market as well as recognising the economic trends that impact our people. |
| Hilton Worldwide | Our current focus in Scotland remains on the retention and creation of jobs within our hotels, and on offering a best-in-class working environment for all of our team members. As part of one of the UK’s leading employment industries, we help create opportunities with upcoming Hampton by Hilton hotels in Dundee and Glasgow, both of which are set to provide new Scottish jobs in the coming months. Team members at Hilton Worldwide enjoy a wide reward package including training and excellent career development opportunities, along with other benefits such as meals, uniforms and our Team Member Travel Programme. We are constantly reviewing this benefit proposition in line with market conditions, and we remain in open dialogue with both political and industry stakeholders on what is a broader issue. |
Refused to participate
- Mitie Group
- Compass Group
- Scottish Midland Cooperative Society
- Expro International Group
- Stork Technical Services
- Teleperformance
- GS Associates (Scotland)
- Primark/Associated British Foods
- Webhelp TSC
- Edinburgh Woollen Mill
Note
To be awarded accreditation as a Living Wage Employer, the employer must ensure that all employees who are regularly working on the employer's premises receive at least the Living Wage.
This includes not only the directly employed staff, but staff who are contracted or sub-contracted through another agency. Where an employer has made a firm commitment to the Living Wage, but they are mid contract and not able to break the contract, we offer phased accreditation.
This means the Living Wage is introduced on a rolling basis as contracts come up for renewal. For longer contracts there are opportunities to implement change around break clauses.
Rolling out the Living Wage across contracts can take some time.
Any contracts that are not on the Living Wage will be included as Milestones in the employer's accreditation licence.
The Poverty Alliance who administer the living wage accreditation scheme in Scotland say: “We check in with employers quarterly to ensure Milestones have been achieved.
“While there is no specific cut-off point for how far into the future a Milestone can be, we expect the bulk of contracts to move onto the Living Wage within two to three years.”
