Following the recent case where the Employment Relations Authority (ERA) ordered 2 Mitre10 stores to pay staff above the minimum wage, as predicted we are now seeing more retail workers and their Unions protesting for the same.
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About 800 workers in conjunction with First Union demonstrated in St Lukes mall in Auckland protesting they should be paid a 'living wage'.
The gap between the minimum wage and the Living Wage of late is seemingly decreasing but far from successfully reaching each other.
The minimum wage governed by legislation increased in 2019 with a $1.20 from $16.50 to $17.70 an hour. This rise is the second in a series of increases brought to bear by the current Labour led coalition Government. The next minimum wage increase provisionally scheduled to rise to $18.90 in April 2020 and again reaching $20.00 in April 2021.
The 'living wage', not governed by legislation is defined as the income necessary to provide workers and their families with basic life essentials. ‘The purpose of the Living Wage is to “enable workers to live with dignity and to participate as active citizens in society”’, stated by the spokesperson of The Living Wage Movement Aotearoa New Zealand. The recommended living wage has increased with 60 cents from $20.55 to $21.15, effective from the 1st of September 2019. Bringing about a $3.45 gap.
“Employers who want to do the right thing” is the reference used when talking about and motivating the living wage. Its further motivated by saying it’s the moral and ethical thing to do. The living wage has also gained both public and private sector support over the past year and is seemingly gaining momentum.
The major concern about the living wage is that we are fighting a battle where the villain and the hero are one. The reason for the living wage is due to workers not being able to afford a reasonable standard of living. Basic living essentials such as bread and milk, fuel/transport, household items and ways of communication are all already deemed to be very high in New Zealand. Should a living wage be implemented across the board this will increase the cost of basic living essentials even further and the vicious circle continues.
Before considering adopting and implementing a living wage we must factor in the ability of the employer to afford workers; determine how the new wage would affect the employment terms and conditions, inflation and the economy as a whole. Some of the negatives for the workforce may include outsourcing of more roles/jobs overseas; a decrease in employee numbers and an increase in workload and stricter policies on performance management. Further to that the costs of goods would be passed onto the consumer, in turn the workforce.
There are benefits for employers such as better scope of recruitment, higher levels of productivity, retention and stability in the workforce and over all higher morale. And if after all factors were considered the implementation is viable for employers the living wage should not only be implemented based on the recommend figures but what the company can afford and the environment the workforce resides in.