CASE APPLICATION #13:39 05 PM - 795336 - 217. 165 230 97 One for the Money. Topic: The Real Living Wage 1999, the United Kingdom introduced the National contractors at their training ground. The move was supported Minimum Wage, requiring employers to pay a minimum by the then Mayor of London, Boris Johnson, who felt this was Lhourly rate regardless of the size of the organization or a good example to set for the other clubs" the nature of the role. Reviewed by an independent body, this minimum rate has increased every year. The campaign for a echoed by many of the accredited employers Oxfam firmly living wage started in 2001 and was aimed at ensuring that believes that being able to wark and eam a decent wage is wages were at levels that allowed workers to meet living costs, fundamental to overcoming poverty. Nestlé see the commercial not just the government minimum. The campaign gained cross- party support, and in 2016, the government introduced the National Living Wage for workers over 25. Both these policies were intended to help workers main- tain a basic standard of living, and organizations seen to be breaking the rules faced government investigation and, in rare cases, prosecution." With these legal requirements in place, Living Wage Foundation does appear to support the decision. why are some companies choosing to pay more? The Living Wage Foundation aims to persuade organiza- the Foundation found that over half had seen improvements in tions to pay employees more than the legal mandate to help both recruitment and retention. For example, Brewdog, as them to afford what they need for a decent standard of living. ufacturer and retailer of craft beer, saw staff turnover fall by 40 which involves things like healthier food. At the beginning percent in the year after they introduced the living wage. Of the of January 2019, they had over 4,700 accredited living-wage so0 businesses surveyed, 57 percent had seen an increase in employers, including a third of the FTSE 100," One of these the commitment and motivation of living wage employees (ris- companies, IKEA UK, introduced the real living wage in April ing to 78 percent for larger employers). In addition, 86 percent 2016. leading to a wage increase for 7,300 workers. Pemille believed that the decision to pay the real living wage had also Hagild. IKEA UK's Country HR Manager, said that the in- enhanced the organization's reputation. crease would help with the company's plans for growth in the United Kingdom and that it would lead to increased motivation Discussion Questions and reduced staff tumover. Employees were reported to have 11-11 Does this case support the myth at the beginning of the said the changes in their lives would be quite significant, al- lowing them to apply for mortgages, pay their bills, and simply 11-12 Do you think that the reported increase in motivation has to enjoy life more. Chelsea FC became the first premiership foothall club to sign up to the living wage in 2014. Chelsea's chairman, Bruce Buck, believed it showed a commitment to the staff, ensuring that hard work and dedication were rewarded fairly. It extended the hourly rate increae to include staff employed by external The theme that this is simply the right thing to do is benefit, believing that being a Principal Partner of the Living Wage Foundation will help them influence the industry, but they also acknowledge that increased wages will have a posi- tive impact on the wider community. Has the move proved a success for Chelsea FC, IKEA, and the other 4,700 cmployers? Rescarch carried out by the Surveying over 800 accredited real Living Wage businesses, chapter? do with something apart from just the extra money? 11-13 Would these benefits to the organiation be seen it middle or higher wage rates had been increased? 11-14 Do you see any long-term issues with this increase in wage levels?