Agenda item

Living Wage Foundation and Cost of Living Mid-Year Pay Increase

To consider measures to mitigate cost-of-living pressures.

Minutes:

Members considered a report which detailed measures that were proposed to be taken to assist staff during the current cost of living crisis. The Council was aware that 2022 would be a difficult year financially for many employees, especially those on the lowest incomes and felt that supporting those on the lowest pay was not only fair but improved the motivation, loyalty, productivity and retention of hard working staff. The Council was already undertaking various measures to support staff and was also committed to paying no less than the Living Wage as determined annually by the Living Wage Foundation, which had recently increased by 10%. In July 2022 National Employers had offered all NJC workers in local government a pay increase of £1,925 per employee. In contrast the Council, which sets pay locally and was not part of the national negotiations, had awarded staff a 2% pay increase for 2022-23, much below the current rate of inflation and below the National Employer’s offer of an £1,925 to staff, which would have equated to a 5.3% increase for Dartford’s staff.

 

Having assessed the options available to the Council, to help mitigate the rising cost of living, a number of recommendations were being proposed, with a view to avoiding an erosion of pay for staff at the lower end of the grading structure and minimise the impact on pay differentials. This included the deletion of the lowest grade in the Council’s pay structure,Grade B Starter, and implementing the Living Wage Foundation’s Living Wage increase with effect from 22 September 2022 for the lowest paid staff. To mitigate against the impact of this increase on Grade C Starter and to minimise the impact on pay differentials between grades, whilst also helping to address the cost of living challenge faced by all staff, it was proposed that all other salary bands, including Specified Posts and Chief Officers, should be raised by £1,000 with effect from 22 September 2022. The application of an additional mid-year set amount pay increase, as opposed to a percentage increase, would ensure that the increase benefited lower paid staff the most to try and help mitigate the rising cost of living, whilst keeping costs below that of a 3.3% increase across the board. It was envisaged that the Council would return to a percentage wage increase from April 2023.

 

The Leader of the Council said that the Council negotiated its own wage settlements with staff which had delivered stability and good sense for staff, and provided greater flexibility. The Council recognised the pressures facing staff due to the current cost of living crisis and was proposing to make a mid-year adjustment to assist those staff on the lowest grades the most rather than waiting for the end of the financial year to take action. This included the removal of the lowest grade in the pay structure.

 

A Member asked for clarification of the basis of the Living Wage Foundation Living Wage. The Leader of the Council explained that the Living Wage Foundation based its calculation of the Living Way on a basket of measures and indices and that it’s Living Wage was higher than the National Living Wage. The Council had committed to paying staff at least the Living Wage Foundation’s Living Wage some years ago and this was factored into the annual pay awards. This had resulted in the Council continuing to increase pay for staff in recent years whilst some other authorities had frozen pay. When the Council had originally set the pay award for 2022-23 at 2% in February this had seemed to be a reasonable increase but circumstances had changed significantly since that time and it seemed only fair and sensible to make a mid-year adjustment.

 

Members welcomed the adjustment to salaries, which would be backdated to September 2022. A Member questioned whether it might be possible to backdate the increase to April 2022 as he observed that there had been pressure on salaries from before that time. The Leader said that when the increase for 2022-23 had been set it had been considered fair and had been accepted by staff. The proposal to backdate the adjustment to September was to coincide with the timing of the Living Wage Foundation’s increase to the Living Wage rather than selecting an arbitrary date. He also noted that although the NJC settlement had been agreed it had not yet been implemented and the Council was acting quickly to ensure that it’s locally negotiated mid-year adjustment would be implemented immediately.

 

The Portfolio Holder for Finance confirmed that one of the reasons why the Council had determined to make its own arrangements for pay rather than joining the national settlement was that the national negotiations took too long. This had also allowed the Council to commit to paying at least the Living Wage Foundation Living Wage, which was significantly higher than the National Living Wage.

 

The Leader of the Council said that it was important to treat staff fairly and to recognise current cost of living pressures. The Council also took care to ensure that staff working for contractors employed by the Council were also fairly paid.  

 

 

RESOLVED:

 

           

That, to mitigate the impact of the rise in cost of living and improve the motivation, loyalty, productivity and retention of hard-working staff:

 

(a) Grade B Starter be deleted from the Council’s pay structure and replaced by Grade B Market, as the Council’s lowest grade in its pay structure;

 

(b) That the Living Wage Foundation’s Living Wage be implemented with effect from 22 September 2022, bringing Grade B Market salary to £21,034; and

 

(c) an increase of £1,000 for all other salary bands, including Specified Posts and Chief Officers, be made with effect from 22 September 2022.

Supporting documents: