Low paid workers in the capital are set to receive a salary increase after City Hall announced a 5% increase in the London Living Wage to £8.30 per hour.
The London Living Wage is calculated by City Hall as the minimum income level Londoners need to meet the additional costs of living in the capital and is paid by the Greater London Authority and over a hundred employers in London including major banks and law firms.
The wage was adopted in 2005 by former Mayor of London Ken Livingstone after a campaign by London Citizens and continued by Boris Johnson who says he has presided over “a three-fold increase” in the number of employers supporting the scheme since being elected in 2008.
To mark its 10 year campaign in favour of a living wage, London Citizens is holding a one-day event to “salute those employers who have led by example.”
Research suggests 10,000 workers have benefitted from the scheme although one in six still receive less than the LLW.
The latest London Living Wage report from GLA Economics suggests an hourly wage rate of 22 per cent above the National Minimum Wage (NMW) rate is needed in London to keep employees above the poverty line.
Announcing the increase Mayor Johnson said: “Decent hard working Londoners deserve proper reward for their labours, and I’m delighted that a growing number of organisations recognise that it suits them as well as their staff to pay the London Living Wage.
“It really is a win win for employers as paying a fair wage fosters a loyal and motivated workforce, while at the same time continues to help pull many Londoners out of poverty and boost the capital’s economy.”
London Citizens Trustee Paul Regan said the group “welcome the new figure of £8.30 and congratulate the Mayor on his outstanding leadership on the Living Wage.
Regan added: “Ten years after London Citizens launched the campaign, we are now launching the Living Wage Foundation to ensure even greater success in the coming decade. There are still hundreds of thousands of Londoners in working poverty and there is no excuse for the employers responsible. It’s time for all London employers to go Living Wage.”
According to KPMG’s London Chairman Richard Reid, adopting the LLW had benefits for employers as well as employees.
Reid commented: “We have been paying the Living Wage since 2006 and have found that it is not just the fair thing to do, but also makes good business sense. Since its introduction, staff turnover has reduced and productivity has increased as attitudes are more flexible and positive.”
Mr Livingstone, who is standing as Labour’s 2012 Mayoral candidate, used today’s announcement to unveil a manifesto commitment to increase the number of Londoners who benefit from the rate. Livingstone also vowed to make paying the LLW a condition “of procurement, employment and services” provided by the GLA.
Livingstone said this requirement “would bring fair pay to tens of thousands of Londoners and would send a clear message to employers in the public and private sector that fair wages are good for everyone.”
London Assembly Member Darren Johnson repeated his calls for the Mayor to do more to persuade Councils to adopt the living wage.
Research by Johnson’s Green group on the Assembly suggests just five of London’s boroughs have implemented the wage, an increase of just one council since the Greens last carried out similar research.
Mr Johnson commented: “The Mayor doesn’t seem to have made any progress in persuading councils to end poverty pay. At this rate Londoners will still find their cleaners, carers and park wardens working below the bread line in twenty or thirty years time. He needs to pull out all the stops to make an impact.
“It is disgraceful that councils can make claims about fairness while they run their own services by paying poverty wages.”