What does the living wage mean for workers and employers? video

Rachel Clayton / Stuff.co.nz

A living wage employer explains why he feels it's worth paying a few extra dollars an hour.

The living wage may cost a few more dollars in wages, but businesses are reaping the rewards of loyal, appreciative staff. 

There are 66 companies listed as "accredited living wage employers" for 2017. The New Zealand living wage will be increased to $20.20, from $19.80 an hour, from July 1. 

Bicycle Junction owner Dan Mikkelsen has been paying his staff a living wage or higher since his business began four years ago.

Cleaning company Fresh Desk pays a living wage to all its workers.
SIMON EDWARDS/FAIRFAX NZ

Cleaning company Fresh Desk pays a living wage to all its workers.

"I've always felt you pay people what you feel they're worth to you as a business," he said. 

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"We have a lot of skilled staff here who are really engaged in their roles, and if I was paying them minimum wage it wouldn't reflect that." 

Bicycle Junction in Newtown, Wellington pays staff a living wage because their hard work is worth the extra cost.
SUPPLIED

Bicycle Junction in Newtown, Wellington pays staff a living wage because their hard work is worth the extra cost.

Ezra Simons, 24, has worked for Mikkelsen as a barista for a year and appreciates being paid the living wage. 

"I'm absolutely more loyal. I've been working in coffee for a few years and I moved around because I felt unappreciated.

"This has definitely made me hang around here, I've been here a year and am pretty locked in here at the moment."

Auckland chamber of commerce chief executive of Michael Barnett says the living wage 'subjective and artificial'.
SUPPLIED

Auckland chamber of commerce chief executive of Michael Barnett says the living wage 'subjective and artificial'.

Owners of commercial cleaning business Fresh Desk, Caroline de Castro and Nicole Oxenbridge put their employees on a living wage, "because it was the right thing to do". 

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"My background is in cleaning work and cleaning is hard work, it's an underpaid industry," Oxenbridge said.  

"When I first moved here from Australia, if someone asked me to do cleaning for minimum wage I just wouldn't do it. I don't think it's enough to do that kind of work.

"If I wouldn't do it for minimum wage, why would I expect others to?" 

The pair employ about eight staff who work hard and recommend the business to people they meet who need cleaners. 

"They're so supportive. I couldn't sleep at night paying someone minimum wage," de Castro said. 

"It's not a hiring tactic we use but when we do hire, people see the amount [of pay] and will apply because of the living wage.

"It's good for us because we get applicants with experience and knowledge, and get the best cleaners out there." 

But Auckland chamber of commerce chief executive Michael Barnett said the living wage made businesses go under and was a cost to ratepayers. 

"Focus on improving skills and paying what a job is worth is the best way for businesses to recognise their responsibility to the communities in which they operate - not paying a 'subjective and artificial' living wage," he said in a written statement. 

"All businesses, including councils hire on merit, so paying a higher rate without asking for better performance is not sound business practice.

"Private sector businesses would soon go out of business, but councils take the easy option – they simply pass the cost on to rate payers.

Barnett said those who couldn't survive on the minimum wage should turn to the government for welfare payments. 

"[Councils] would be far more responsible if they focused on encouraging low paid staff to improve their skills and ensure they receive their full government welfare entitlements," he said.

 - Stuff

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