Department for Business, Energy and Industrial Strategy: Living Wage

Department for Business, Energy and Industrial Strategy written question – answered on 22nd July 2019.

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Photo of Rachel Reeves Rachel Reeves Chair, Business, Energy and Industrial Strategy Committee

To ask the Secretary of State for Business, Energy and Industrial Strategy, whether his Department plans to gain Living Wage Foundation accreditation as a living wage employer.

Photo of Andrew Stephenson Andrew Stephenson Assistant Whip, Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

The Government is committed to ensuring fair remuneration for workers across the economy. In April 2019, the National Living Wage (NLW) rate was increased to £8.21 per hour, a rise of 4.9 percent. This means that the annual earnings of a full-time worker on the NLW will have increased by over £2,750 since the policy was introduced. We are also supporting and encouraging employers to pay more where possible and appropriate.

In line with this, at the end of last year, at the request of my rt. hon. Friend the Secretary of State, officials in BEIS undertook a review of the pay of staff working through its contractors, in order to ensure they receive a wage which is fair and directly comparable to other employers across the local labour market.

As a result of this review, the Department agreed with its contractors (Aramark and ISS) that, from 1 March 2019, they would align the pay of their cleaning, catering, mailroom and security staff to the appropriate median rates for those occupations as identified in the 2018 Annual Survey of Hours and Earnings (ASHE). This survey captures pay details for around 300,000 employees from the HMRC Pay As You Earn (PAYE) system down to Local Authority level and is therefore a robust and reliable source of pay data.

The immediate change for some staff has been significant. For example, some of our lowest paid security guards saw an increase of over 15%. Pay for staff working through our contractors will continue to track the median rate in future years

The Department does not currently intend to seek accreditation from the Living Wage Foundation.

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