As the cost-of-living crisis continues, Living Wage Funders are stepping up to ensure that grantees can pay all their workers the real Living Wage.
By Lianna Etkind, Partnerships and Campaigns Manager, Living Wage Foundation
47% of entry-level charity jobs in London, and a shocking two-thirds of entry-level charity jobs outside London pay less than the real Living Wage.
That’s the findings of a report that CharityJob published last month, based on an analysis of over 48,500 jobs published on their website over 2023. The impact on workers taking their first step into the sector is as depressing as it is predictable: not being able to afford decent housing, the mental strain of worrying about spending, and having to skimp on food – 60% of low-paid workers polled in 2023 had to visit a foodbank in the last year.
Based on the real cost of living
The real Living Wage is a voluntary rate, and distinct from the Government’s 'National Living Wage'. It’s calculated every autumn based on the real costs of living. The majority of charity leaders see themselves as values-driven people, committed to making the world a better place. It’s depressing that despite this, some charity leaders are, through their charities’ pay structures, contributing to in-work poverty and the mental and physical ill-health that poverty causes.
Especially in London, making ends meet is hard. London’s funders do incredible work to support charities and community groups who are building a fairer city. By taking simple steps, such as mentioning the real Living Wage in application guidance and being transparent that they will fund grantees to pay staff the real Living Wage, Living Wage Funders align their processes with their mission and values, and give grantees the financial freedom to do the right thing.
Low pay deters working-class people from the sector
As well as the impact on charity staff, low pay has an impact on the diversity of the charity sector as a whole. Funders are engaging with diversity, equity and inclusion more than ever before, but overwhelmingly the evidence shows that charities continue to hire people from their own class bubbles and miss out on talented people from working-class backgrounds. Some people can afford to take a poorly paid job as a step into the sector, relying on a cushion of savings or on the bank of Mum and Dad. But for people without those privileges, entry-level jobs which pay below the real Living Wage are like a big red ‘KEEP OUT’ sign.
It’s no mystery why so many charities, who ostensibly are dedicated to combating poverty, inequalities and injustices, continue to pay staff so badly. Funding is tight. Charities face difficult decisions about where to divert scarce resources, and balancing commitments towards staff and beneficiaries. Faced with a grant or tender application, charity fundraisers may be tempted to ‘lowball’ staff costs, believing that a cheaper quote may give them an edge in a competitive commissioning and funding environment.
The role of funders
This is where funders who believe in reducing poverty and inequality can play a crucial role. At the time of writing, there are 85 Living Wage Funders, ranging from small community foundations like Milton Keynes Community Foundation, to corporate funders like Lloyds Bank Foundation, to public sector funders like Islington Council and independent foundations like Esmée Fairbairn. They are united in their commitment to paying their grant-funded roles at the real Living Wage, and signposting Living Wage to their grantees. Living Wage Funders commit to being upfront about their commitment to the Living Wage, and to funding the costs of grant-funded posts so that staff have enough to live on. This transparency goes a long way to reassure charities that they can submit funding applications with fairly-paid staff costs, and to enable charities to operate in accordance with their values.
Interested in accrediting as a Living Wage Funder? Simply fill in the form here and we’ll get back to you with more information or to arrange a call, or just email lianna.etkind [at] livingwage.org.uk
Lianna Etkind is a Partnerships and Campaigns Manager at the Living Wage Foundation and manages the Living Wage Funder scheme.