National Living Wage Week: How can big companies, earning big profits, keep paying such little wages?

This isn't about paying people to subsidise extravagant lifestyles. Far from it

Share
Related Topics

Ask anyone who works in the service industry about their job and the majority will tell you the work is hard and satisfaction is low. Well this week is National Living Wage Week; so, for a short period debate is raised over the millions of willing people who hold jobs, yet still struggle on what little money they earn. Welcome to 21st Century Britain.

The large group of people who are inevitably inflicted with this head-in-vice lifestyle is the people who work in the service industry. In almost every bar you drink in, every coffee shop, restaurant, clothes store, hairdressers, and garage there probably exists a person struggling financially, worrying about basic things such as paying rent, utility bills, and eating well.

This week Labour announced plans to encourage companies to provide staff with a living wage, by offering £1,000 tax breaks per worker they help. National Minimum Wage is £6.31 per hour, which increased a mere 12p from 2012. Why then, is the recommended National Living Wage in the UK set at £7.65, while the advised rate for London is £8.80? As the minimum wage continues its sluggish year-on-year ascent and energy costs continue to soar each year – it is depressingly out of sync with UK living costs. The Joseph Rowntree Foundation reported that the cost of living has risen 25 per cent over the past five years, while minimum wage has been raised only 58p during this period.

I work in a bar part-time, often till past 3 am, and there’s nothing more demoralising than a punter pulling a First World Sulk on a Friday evening after hearing the dreadful news that the Pinot Grigio they want is out of stock. It's no secret that people working in the service industry have to put up with a lot of rudeness, and can get pretty fed up with the petty gripes of customers – the pay doesn't exactly make everything worthwhile.

It was reported earlier this year that in 15 years of trading in Britain, global tax-avoiding coffee-chain Starbucks paid a mere £8.6m in corporation tax on sales of £3bn. So while Starbucks gets away with tax avoidance its often over-qualified staff are earning wages below a basic living standard. Big companies should be held accountable for not paying workers the rate of a living wage – and forced to do so if they earn over certain thresholds.

The Deputy Director of living wage campaigners Citizens UK told me: “It's a decision about the kind of company you want to be. Over 430 employers have chosen to go Living Wage because they're taking responsibility for the well-being of their staff.” 

Businessman Steve Cox, Owner of Faucet Inn, a group of 20 London-based bars and pubs, has recently moved his 300 staff onto living wages, which is highly commendable and a victory for the workers in the service industry.

“It wasn’t a very difficult sell, us putting their wages up, it was the moral thing to do. I think it’s been transformational for some of the people in terms of living in London, the morale is so much higher, and this has always been a transient kind of business [for staff], but now everyone has the ability to earn a wage that can make ends meet” says Cox.

This debate isn’t about paying people a wage to afford extravagant lifestyles; this is about paying people enough money to live without fear of bailiffs knocking at the door. For a developed country in the 21st century, such a situation is abusive and unacceptable.

React Now

  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Recruitment Genius: Hotel Reception Manager

£18750 per annum: Recruitment Genius: This Hotel in Chadderton is a popular ch...

Recruitment Genius: Designer

£32969 per annum: Recruitment Genius: This company is going through a period o...

Recruitment Genius: Data Engineer

£35000 - £55000 per annum: Recruitment Genius: A Data Engineer is required to ...

Ashdown Group: Senior Accounts Assistant - Accounts Payable - St. Albans

£26000 - £28000 per annum + benefits : Ashdown Group: Senior Accounts Assistan...

Day In a Page

Read Next
 

Election catch-up: Just what the election needs – another superficially popular but foolish policy

John Rentoul
A Gold Ferrari sits outside Chanel on Sloane Street  

Sunday Times Rich List: We are no longer in thrall to very rich people

Terence Blacker
Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

How a costume drama became a Sunday night staple
Miliband promises no stamp duty for first-time buyers as he pushes Tories on housing

Miliband promises no stamp duty for first-time buyers

Labour leader pushes Tories on housing
Aviation history is littered with grand failures - from the the Bristol Brabazon to Concorde - but what went wrong with the SuperJumbo?

Aviation history is littered with grand failures

But what went wrong with the SuperJumbo?
Fear of Putin, Islamists and immigration is giving rise to a new generation of Soviet-style 'iron curtains' right across Europe

Fortress Europe?

Fear of Putin, Islamists and immigration is giving rise to a new generation of 'iron curtains'
Never mind what you're wearing, it's what you're reclining on

Never mind what you're wearing

It's what you're reclining on that matters
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband

Chuka Umunna: A virus of racism runs through Ukip

The shadow business secretary on the benefits of immigration, humility – and his leader Ed Miliband
Yemen crisis: This exotic war will soon become Europe's problem

Yemen's exotic war will soon affect Europe

Terrorism and boatloads of desperate migrants will be the outcome of the Saudi air campaign, says Patrick Cockburn
Marginal Streets project aims to document voters in the run-up to the General Election

Marginal Streets project documents voters

Independent photographers Joseph Fox and Orlando Gili are uploading two portraits of constituents to their website for each day of the campaign
Game of Thrones: Visit the real-life kingdom of Westeros to see where violent history ends and telly tourism begins

The real-life kingdom of Westeros

Is there something a little uncomfortable about Game of Thrones shooting in Northern Ireland?
How to survive a social-media mauling, by the tough women of Twitter

How to survive a Twitter mauling

Mary Beard, Caroline Criado-Perez, Louise Mensch, Bunny La Roche and Courtney Barrasford reveal how to trounce the trolls
Gallipoli centenary: At dawn, the young remember the young who perished in one of the First World War's bloodiest battles

At dawn, the young remember the young

A century ago, soldiers of the Empire – many no more than boys – spilt on to Gallipoli’s beaches. On this 100th Anzac Day, there are personal, poetic tributes to their sacrifice
Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves

Follow the money as never before

Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves, reports Rupert Cornwell
Samuel West interview: The actor and director on austerity, unionisation, and not mentioning his famous parents

Samuel West interview

The actor and director on austerity, unionisation, and not mentioning his famous parents
General Election 2015: Imagine if the leading political parties were fashion labels

Imagine if the leading political parties were fashion labels

Fashion editor, Alexander Fury, on what the leaders' appearances tell us about them
Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

The architect of the HeForShe movement and head of UN Women on the world's failure to combat domestic violence