This week we became an accredited UK Living Wage employer
In general, we have been paying our staff more than the UK Living Wage for awhile now but we think it’s important to shout about our achievements while being open about where we want to improve. After decisions and strategic discussions held at our Team Meetup in La Clusaz we decided accreditation would be important to who we are at HappyPorch.
The accreditation involves a quick and easy application. I filled out the form and after speaking to Rachel at the Living Wage Foundation , and paying the accreditation fee, we received the logos to use and formalised part of the way we approach setting salaries.
The scheme is quite interesting in that it’s self regulated - there are no documents we need to provide to prove that we pay the Living Wage. The Foundation does not have the resources to monitor that so have adopted an approach based on morality and assuming that nobody intends to be disingenuous (much like Ultimate Frisbee, Barry?). Coupled with a robust whistle-blowing policy, the accreditation seems to police itself.
As an international company with remote contractors/team members, our situation is complex. The Living Wage foundation is only about to provide a living wage for the UK. I wanted to find an equivalent for each of the countries in which we have long term contractors. This isn’t easy to find out as most countries, particularly those with lower costs of living, don’t have a foundation like the UK’s Living Wage. A minimum wage is easy to find on the internet through various economic resources. I calculated that there is a 13% difference between the UK minimum wage and the UK living wage. So I added that 13% for each of the minimum wages I was able to find for our relevant countries:
Australia - $34,452.60 pear year. Therefore, Living wage of $38,931.44 per year
Brazil - 18 600 real per year. Therefore, 21 018 per year (£4151.26), based on projected 2020 figures
Bulgaria - €2664 per year. Therefore, €3010.32 per year
Czech Republic - €6228 per year. Therefore, €7037.64 per year
Kenya - 268 800 KES per year. Therefore, £2096 per year
Portugal - €8040 per year. Therefore, €9098.20 pear year
Serbia - Minimum wage is set at €3696 per year. Therefore, €4176.48 per year.
South Africa - Minimum wage is 42 000 per year. Therefore, 47 460 RAND per year (circa £2533.89)
This is an incredibly low bar (even lower than we were expecting) and we do pay our professional contractors many times more than these figures, based on their skills and experience. There are two members of our team based in very low income countries who, although they are paid at least an average salary for their city, are not yet at UK Living Wage rates.
We assume that the difference between the above calculated ‘living wage’ and what would be considered a ‘good’ salary might be much bigger in some countries than it is in the UK (perhaps not surprising in countries where there is an even bigger difference between rich and poor).
We plan to calculate average salaries based on sector/skills/experience which might give us a more realistic bar to aim for in terms of how we set salaries. This won’t be easy as the UK Living Wage is a reflection on how far a person’s money goes in the UK. To try and come up with an equivalent for each country we might be up against things like a litre of milk costing £1.65 in Australia but only 80p in Kenya. Tricky.
All this is only a small part of a wider conversation about salary challenges in a fully transparent, globally distributed company like ours. Trickier still.
Although we have a way to go, it feels good to be making even a small step towards ‘walking the talk.’