Living Wage Podcast

In this podcast members of the LGA Workforce Board and officers discuss some key issues about the Living Wage.

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Podcast transcript

(Time: 00.13 – 01:24) Simon Pannell, Principal Adviser Employment & Negotiations, Local Government Association

Can you give us a brief background to the Living Wage?

There's quite a lengthy International history with regard to the Living Wage. It became an issue in Britain more specifically about then years ago in London and there was a rate set by the Greater Authority for London. It's also now got a national profile through the Living Wage Foundation and both those rates are set annually and announced at the same time. With regard to the LGA., our view is that it's very much a matter for local authorities to determine whether they're going to apply the living wage. But we think it's helpful to them if they have as much advice and guidance to enable them to come to that judgement at local level.

Why is the current uptake of the Living Wage amongst local authorities?

At the moment we think that about 100 authorities are either implementing the Living Wage already for their direct employed workforce, or have a firm date by which they will do so. Of that number 22, have gone for accreditation, which means they will be rolling out the living wage to their contractors. Later in this podcast you'll be hearing from authorities who've taken the view that accreditation is a good thing and have taken it forward and another authority that at this stage that hasn't decided to go that far.

(Time: 01.25 – 03:25) Jim McMahon, Leader, Oldham Council

What approach has Oldham Council taken to the Living Wage?

Well in Oldham we've carried out a fundamental review of how the Council does business. We want to be a fair employer and an ethical employer, so we've reviewed our training and development programme and we've reviewed how much we paid staff and we've also looked at how we can help staff get back out into the community, to really show the community that we're there as part and parcel of the community, so staff volunteering in Oldham have been a major part of that. So we've used the living wage really as a reason to get into the organisation, to peel back and to make sure that we're doing what we say that we're going to do in terms of being an ethical employer.

What are the 3 key benefits you've experienced?

We want to make sure that staff at the bottom end are supported in that and actually it's almost unethical to pay people less than it costs to live, to pay the bills. And if people are worried about their own domestic circumstances being able to make ends meet, it does of course affect how people feel about coming into work, so we've seen staff morale has the major benefit from this. But actually we want to try and improve the economic circumstances of our town as well. So we've used this almost as a campaign tool, but in order to go out there and convince other employers that they should be getting behind the Living Wage, we had to get our own house in order first, which was about building up credibility for that. But again the third one is, we've used that as a reason really to unpeel and to get really into the organisation to make sure that we're supporting staff, we're investing in staff and we are an ethical employer.

What key things should council's consider when embarking on this journey?

The most important thing is that the Living Wage isn't seen in isolation, it's part of a wider package of how we support staff and invest in staff and boost staff morale. So it's really important that staff are involved, engaged and they get to understand and contribute to the Living Wage discussion, but also that they use that as a reason really to unpeel and to look at how to invest in training, in development and really invest in staff. The other thing is not just to stop in an insular way, just what the council does, it's important that you use this as a foundation, to get out there within your town or your city, to try and promote this across to the private sector and other public sector agencies.

(Time: 03:26– 05:39) Councillor Clive Woodbridge, Epsom & Ewell Borough Council

How have you approached the Living Wage at Epsom and Ewell Borough Council?

Well at Epsom and Ewell Borough Council we are committed to paying all our directly employed staff the living wage. We carried out a review of all our employed staff and we found that there were just two people who were being paid less than the Living Wage and we have taken steps to put them on the Living Wage now. We did debate whether should we become an officially accredited Living wage authority, in the end though we found that the annual costs in terms of the subscription fee and also Officer time, did not make it worthwhile for us. We just couldn't see the benefit as all our staff were being paid the Living Wage. We're also an IIP Gold employer, so we felt that our staff were already getting the message that we were an employer that was committed to their well-being.

What has been the most difficult challenge and what has had the greatest benefit?

Well I think the most difficult challenge has been rolling out the living wage concept to our contracted employees. In particular our biggest contract which is our Facilities Management Contract. Recently we had a change of  contractor and that's allowed us to explore this again and we've had some very useful negotiations with them and we're nearly there. Of course there will be an additional cost to the Council and consequently there will a political decision that has to be taken around whether we're prepared to pay that additional cost, but I'm hopeful that we will get there in the end and that we will be able to ensure that our contracted staff as well are also paid the Living wage. I think there was one other Challenge that Epsom and Ewell Borough Council had to deal with and that related to individual circumstances. When we reviewed our employees, we found that one particular employee, had we paid the Living Wage would actually have been worse off due to her particular benefit circumstances. Thankfully we've been able to resolve that, but I think it does show that you have to look at individual circumstances when applying the Living wage. In terms of benefits, I think we've sent a strong message to our employees that we are committed to the on-going application of the Living Wage and I think that makes a strong statement at Epsom and Ewell Borough Council is a good place to work and hopefully that will continue to be the case.

(Time: 05:40– 09:42) Some Practical Advice from a County Council ‘Director of People' Dilys Wynn

What are the main factors that local authorities should take into consideration?

Well my focus has been on employment and employment related issues in terms of implementing the living wage, so there's about 4 key factors I think for local authorities to consider. The first one is the impact that the living wage might have on pay structures and thinking carefully about how you would actually manage that. So for example, if you have a national award for the living wage how quickly would it be that, that award would start catching up with the bottom scale points on your salary scale and affect effectively the job levels there? And that could leave you with a grouping if you like of jobs which have been sized differently through job evaluation but effectively now attract all the same award. And there's been quite a lot of conversations about differentials and this is where this comes in so for example if you have a supervisor, supervising other staff on those lower salary grades, there is a potential for that particular management issue to arise as well. So you just have to think quite carefully about how you manage all of that. The second key area is around whether or not as a local authority you want to be accredited or not and there are two additional factors that you just need to take into consideration, if that's your choice. The first one is that you'll be subject to a national pay award, every year, paid out in November. And it's nationally set, it's not something that's locally negotiated to indeed that employers in local authorities will have an input to. An the second area to consider is that you need to be prepared to commit to a timetable, through which you would actually bring on board your providers of commissioned services to also pay the living wage and those are just two other areas that you need to consider depending upon you want to be accredited or whether you feel, well actually you could arrange a local scheme. The third are to look at is equal pay. Now equal pay is actually not going to be an issue in local authorities, so long as they decide that any Living Wage policy that they choose to adopt is applied to all employees and that includes all employees in maintained schools, if that authority has maintained schools. And that takes me neatly on to the schools issue, as I said before one does need to consider about implementing the living wage across all employees and therefore it involves us doing a very careful consultation exercise with schools so they understand the implementation issues for themselves, but also we need to do that to ensure that there aren't equally pay issues for local authorities. Now the equal pay area involved in this is actually quite complicated, so rather than try and sum that up in a very small period of time, I know that there's a lot of information being provided by the Local Government Association on this and that can be accessed through their website.

What key pieces of advice would you give to councils?

From my research, I've probably got 4 pieces of key advice to give those people looking at the Living Wage in local authorities. And that is to start with a really comprehensive information pack, which has all the consequences potentially of implementing the Living Wage, but is very neutral, has all the elements in it, but actually doesn't have any recommendations in it. My second piece of advice, would be to treat the whole thing as a full project and that ensures that you've properly consulted everyone who needs to be consulted, you've included all the stakeholders, you've got your decision making and your governance in place and you've got your implementation arrangements really sharply honed down so that it can be implemented in a really smooth way. The third piece is if you have schools, make sure that you fully consult and that includes with every single individual school. And my final piece of advice, is if you choose to go down the road of adopting a local scheme, that that scheme is something that's actually sustainable for perhaps a longer period rather than something that's very short, only for a year, which I believe would be quite disruptive for staff and effectively would have a detrimental impact on morale, which I'm sure most local authorities would be seeking not to achieve.

(Time: 09.43 – 10:02)  Simon Pannell, Principal Adviser Employment & Negotiations, Local Government Association

We want to hear from you…

We hope that everyone who's watched this has found it useful and we would really like to hear from authorities that have implemented it and those who are thinking about it with regard to the Living Wage and I would be delighted to hear from authorities who've got more to say on this topic.

10 January 2014