Some of the lowest paid workers in Newcastle are in line for a pay rise if the city council introduces the Newcastle Living Wage for its staff.
More than 2,200 employees could receive up to £1,100 a year after tax if the policy is approved by the Cabinet on Wednesday, September 26.
The introduction of a Living Wage at a rate of £7.20 per hour is a key part of the council’s priorities to tackle inequality and reduce child poverty.
It would be given to staff on the two lowest pay grades in the council.
The £980,000 cost would be met through internal efficiencies such as senior management costs. It would have no impact on services to the public.
Last year the council set up an independent Living Wage Advisory Panel which published a report in April setting out 10 recommendations. The council is committed to introducing a Living Wage, and if the report is approved, it could be paid to staff starting from this November.
The leader of Newcastle City Council, Coun Nick Forbes, said: “The Living Wage is about the council and wider society sending a clear message that we value the low paid staff who do vital jobs such as cleaners, supervisory assistants and kitchen assistants.
“Without their hard work, our city would grind to a halt.
“We live in a very unequal society with some people earning telephone number salaries and others really struggling to get by. This move is about making Newcastle fairer and more at ease with itself as we attempt to reduce the gap between the richest and the poorest.
“A living wage makes good business sense too; research shows that putting more money into the pockets of the lowest paid means more is spent in local shops giving a welcome boost to our economy."
The reports says some of the benefits of a living wage include:
• Easier recruitment and retention of staff
• Better attendance and reduced sickness absence
• Better productivity, motivation and loyalty
• Better quality of service for customers
The report states that a Living Wage would aim to break the cycle of poverty and mean more money would be available to help families bring up their children which would help tackle high levels of child poverty in the city.
The council will seek to retain control of its rate and review its Living Wage as part of its annual pay policy. It will however lobby Government for additional funding for the Living Wage and encourage other organisations to explore the possibility of paying a Living Wage.
The council intends to advertise the new chief executive post at a reduced salary of £150,000 to reduce the gap between the lowest and the highest paid in the organisation.
This year’s budget saw a reduction in management costs of £3.4m.
Page last updated: 20 September, 2012
