The lowest-paid employees at Hampshire County Council will not be offered the living wage after members decided it was ‘not appropriate’ to do so.
The proposal to pay the council’s directly-employed staff – those working in its departments and non-teaching jobs in schools – the living wage of £7.65 per hour was debated by members of its employment committee on Wednesday (March 12).
Despite almost a fifth (5,135) of the council’s employees currently earning less than the living wage, it was decided that benefits such as a pension, annual leave and sick pay brought the overall package above the living wage.
Employees are also able to climb a pay scale, which allows them to earn more than the living wage after four years.
Committee chairman and executive member for human resources, Stephen Reid, said: “Staff are doing fantastic work and playing a valuable role in helping the county council to remain in a strong place as a provider of high quality local services to the people of Hampshire.
“As the authority looks to make significant savings in the coming year, simply introducing the living wage would not be the best thing for the organisation or for staff in the long-run.
“On balance therefore, the committee decided not to introduce the UK living wage at this time.”
Research by the Local Government Association shows that 77 local authorities have implemented policies to introduce the living wage and a further 20 are ‘fully committed’ to doing so.
The living wage is an hourly rate set independently and updated annually, and is calculated according to the basic cost of living in the UK.
Employees on the living wage earn around £14,758 per year, compared with £12,173 on the national minimum wage.
Council members were told that by introducing the living wage, the quality of work may increase.
However, the risks included creating a wage bill that is unsustainable, leading to job losses and potential council tax rises.
Cllr Reid said introducing it would have added costs at a time when the council is seeking to reduce them.
He added: “The proposal would also have knock-on effects on the services we provide, making them less competitive, for example adding an extra 5p to every child’s school meal in Hampshire when, for the last six years in a row, we’ve ensured the price stays the same.
“In the current round of efficiencies we have avoided the need for compulsory redundancies through the use of voluntary measures and vacancy management, but the living wage proposals might force us to look at compulsory job cuts.
“At a time of on-going financial constraint, I want to be protecting people’s jobs.
“In short, Hampshire already offers a package which is better than the living wage, we are recruiting the staff we need and are successfully navigating the council through difficult financial challenges. The living wage concept is a well meaning one, but is not appropriate for Hampshire County Council at this time.”