Ricky Nicol: Living wage worthwhile investment

Around 35,000 low-paid workers will receive a 20p-per-hour wage increase with plans to raise the living wage to £7.85 an hour, it was announced last week.

The new rate, set by the Living Wage Foundation, will be 21 per cent higher than the national minimum wage and works on a purely voluntary basis – as firms choose to adopt it.

I’m extremely passionate about this initiative as I believe paying people enough to live on, without the need for extra help from the state, is a fundamental responsibility of an employer, will make us stronger as a society and most importantly it is a point of decency and respect.

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I’m very proud and open about my working class roots and about being a socialist ‘lefty’, but I don’t think an employer’s background is relevant. I truly believe it sends out the right message to employees that they are valued.

The scheme is called the living wage for a reason – it has been calculated as the amount of money needed to actually live on, therefore to employ somebody full-time and pay them less than this is, in my view, disrespectful.

I know there are many sectors, such as hospitality, where the living wage is not adopted and people are still struggling by on the minimum wage. I’m sure they could give various reasons for this, but it’s simply not something I could live with.

On top of this moral standpoint, I firmly believe employers get more in return for this increased investment. They would see a more enthusiastic and engaged workforce who are more likely to recommend your business and less likely to leave.

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Currently, only just over 1000 employers adhere to the voluntary living wage scheme nationwide, which is absolutely appalling.

It was originally implemented after a study revealed 5.2 million people, 22 per cent of the workforce, are paid less than the living wage and struggle to keep up with rising living costs and inflation.

At Commsworld, throughout our 20-year history, we have always made a point of paying more than the minimum wage, therefore it was easy for us to adopt the living wage when it was first announced.

We enjoy an extremely low staff turnover rate amongst our junior staff and the rate we pay is one of the reasons, but it also helps to develop the other reasons that prevent staff from leaving.

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Paying new staff wages they can live on immediately earns a level of respect and enthusiasm. The enthusiasm drives the employee to work harder and smarter by becoming more interested in the health and strategy of a business.

At Commsworld we quite often see this increased engagement actually resulting in a tangible return on investment as staff have recommended us to friends or family and have brought in many leads that have resulted in business.

I would urge all employers in Scotland, and especially Edinburgh and Lothians, to think about implementing the living wage.

If any business leaders reading this today are considering adopting it, but the numbers are making them nervous, I would urge them to take the leap. You will not regret it.

• Ricky Nicol, who grew up in Craigmillar, is chief executive of Commsworld, Scotland’s biggest independent specialist in network, telephony and mobile communication solutions