Members last week supported a proposition from Deputy Geoff Southern to ensure all staff, including sub-contractors, employed by the government would be paid at least the living wage from this summer.
Last year’s Jersey living wage figure was £9.75 an hour as standard. The minimum wage is currently £7.18 an hour.
Deputy Southern said he hoped the move would prompt other companies to follow the States’ lead and offer their staff the living wage – although doing so would be entirely voluntary.
Eliot Lincoln, president of the Chamber of Commerce, said that doing so would equate to a 36 per cent increase and would be unsustainable for a large number of companies.
He said: ‘Many of our members already pay far in excess of the living wage, however agreeing to pay a living wage across the board simply isn’t practical for some, particularly small, businesses.
‘This would represent an increase of £7.18 per hour to £9.75 per hour – a 36 per cent increase – [which is] simply not practical for many employers, particularly those in the hospitality, retail and agriculture sectors.
‘As clearly articulated in the Oxera Report commissioned by the States and released in June 2017, in reference to a proposed 17-per-cent increase above the current minimum wage: “There would be an increase in firms’ costs, following which we would expect a number of job losses, reduced hours, increased prices for consumers, and lower firm profits. The job losses would be concentrated in the hospitality, agriculture, and retail sectors”.’
A living wage differs from place to place and is a rate of pay that is deemed high enough for employees to maintain a reasonable standard of living in their community. Charity Caritas has been licensed by the Living Wage Foundation to set the rate for Jersey.
Deputy Southern said there was ‘no pressure’ on businesses to pay the living wage and understood that it might not be possible for all Island firms. However, he added that he hoped as many as possible would sign up to the living wage standards.
He said: ‘It is nice to see something with such an important impact on people’s living standards come into force. It is right for the States to lead the way.
‘It has been disappointing [to see] how few finance companies in Jersey, often subsidiaries of UK companies, who have signed up to the living wage in the UK but haven’t here.
‘There is no compulsion but I would hope to see the trickle effect start. No one is twisting their arm – if your business model doesn’t allow it, then by all means approach it very gently.’
The Deputy added that while there might be a financial impact for some firms, the reputational boost they could receive by signing up as living wage
employers could generate a positive impact.
Meanwhile, Dominique Caunce, head of communications and specialised services for housing provider Andium Homes, said: ‘We are happy to confirm that we will be seeking accreditation as a living wage employer. Of course, we will also take the living wage into consideration in future procurement contracts.’
