Employers and The Living Wage

Lidl has become the first supermarket to announce it will pay its employees the living wage.

After the government announced the National Living Wage in their first budget since the general election, many employers were preparing themselves for the gradual increase in wages they would have to pay by law. Supermarket Lidl however have set the precedent by pledging to pay all staff a minimum of £8.20 per hour (with staff in London being paid £9.35).

Above The Law

Not only is this amount much higher than the £7.20 set by the Government, it will come into effect from October 1st, rather than next April when the National Living Wage will be introduced. What’s more, this wage will be paid to all workers as opposed to those over the age of 25; the age that entitles workers to the Living Wage under the new government rules. This is in line with the Living Wage Foundation’s calculations of the amount employees should be paid in order to live a comfortable lifestyle.

The Living Wage and Small Businesses

Workers will see an approximate wage increase of £1,200 per year at a cost of £9 million a year to Lidl. It is the rise in popularity and profit growth that the supermarket chain has experienced that has allowed them to pay their staff a living wage. Smaller companies may well struggle to pay their employees an increased wage, and even chain stores such as Card Factory have predicted set-backs once the government enforced Living Wage is introduced.

Top Employers

While not every big company pays their staff the Living Wage, there are a number of high profile employers that do, including Royal Bank of Scotland, HSBC, Nationwide and Aviva. You can take a look at the top 12, as listed by the The Guardian, here.