date: Monday 5 November 2012
embargo: For immediate release
The TUC has today (Monday) welcomed the announcement from the Living Wage Foundation and the Greater London Authority (GLA) that the guideline rate for the living wage is to rise, but warned that too few large employers are paying the new rate, despite having the resources to do so.
The living wage is a voluntary rate of pay designed to help low-paid workers to afford a basic standard of living. The new rate is £8.55 an hour in London and £7.45 elsewhere. The adult minimum wage rate is £6.19 an hour.
However, the TUC believes that far more companies can afford to pay the living wage. Figures from the Office for National Statistics (ONS) show that the UK's biggest companies increased their cash reserves by over £80bn between 2007 and 2011. There is no excuse for cash-rich employers to deny low-paid staff a decent wage, says the TUC.
The TUC added that paying the living wage is in the interests of employers, as it improves staff motivation and productivity, and enhances corporate reputations.
A study published last week by the consultancy group KPMG revealed that nearly five million workers are currently being paid less than the living wage.
TUC General Secretary Designate Frances O'Grady said: 'The rise in the living wage in London and the rest of the UK could be hugely beneficial to low-paid workers across the UK. We commend those employers who have already signed up to it.
'However, it is essential that more companies follow suit. We want millions to benefit from a living wage, not thousands. It is simply not good enough for large companies to plead poverty at a time when their cash reserves are increasing.
'Employers who pay the Living Wage will find it much easier to recruit and retain good staff. The extra pay in the pockets of low-paid workers will also help inject much-needed consumer demand back into our economy.'
NOTES TO EDITORS:
- The living wage rate in London is set by the Greater London Authority and the living wage rate for the rest of the UK is set by the Living Wage Foundation.
- The growth in financial reserves for large companies increased from £641 billion in 2007 to £725 billion in 2011 (Source: Table 10.5, Reserves of private non-financial corporations, UK national accounts, ONS 2012)
- The recently launched independent Living Wage Foundation has today announced the first tranche of certified living wage employers. More announcements are expected in the next few months. For more information see the Living Wage Foundation website: www.livingwage.org.uk
- All TUC press releases can be found at www.tuc.org.uk
- Follow the TUC on Twitter: @tucnews
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Issued: 5 November, 2012