Living wage makes society stronger; Opinion: Paying employees enough to live on is a powerful way to reduce poverty in British Columbia

By Tamara Vrooman, president and CEO of Vancity; Vancouver Sun

The current minimum wage in B.C. provides only 52 per cent of what a family of four with two adults working full-time needs to pay for basics in Metro Vancouver. Knowing this makes it clear that low wages are a factor in rates of homelessness and dependence on food banks.

But it’s also a fact that lower wage earners, who most often spend their dollars locally, are an economic driver. Putting more money in the hands of working families is one of the best economic development strategies we can employ and an important way to solve family and child poverty.

Two years ago, Vancity embarked on a journey to be Canada’s largest living-wage employer. Today, we are sharing what we’ve learned and calling on other organizations to consider joining us in the work to build stronger, healthier communities in B.C.

It was our board of directors who got behind this initiative; they knew that high living expenses combined with low wages meant that many thousands of families were living in poverty in B.C. For most of the last decade, our province has had the highest child poverty rate in Canada. Yet, data showed a significant number of those families had at least one parent working full-time.

Simply put, a living wage is the amount of money an employee needs to earn — based on a typical work week — to meet a family’s basic needs. The wage rate varies by community as it reflects costs associated with living in a specific place. Currently, Vancouver’s living wage is $19.62 per hour. In B.C., the living wage is calculated by the Canadian Centre for Policy Alternatives on behalf of the Living Wage for Families Campaign.

The calculation of the living wage is based on maintaining a modest lifestyle. It includes enough for basic needs such as rental housing, food, clothing, child care, transportation, medical expenses and enough to ensure a family can afford to participate in some social activities, such as children’s recreation. It’s a bare-bones lifestyle, calculations do not include the costs of home ownership, debt repayment, or savings.

Our initial step as a living-wage employer was to ensure all our employees were paid a living wage. Then we looked at the areas of our business operations where we spent the majority of our budget for contracted labour services. As our agreements come up for renewal, we work closely with our suppliers to make the payment of a living wage an integral part of our business relationship. We ensure they knew that we did not want them to compete for our business on the basis of paying their employees less than the current living wage.

We paid particular attention to contracted employees who were at the highest risk of not earning a living wage. Typically for us, as for many organizations, these employees work in security, janitorial, and food services.

Did it cost more? Yes it did; we consider this a direct investment in the health of our employees, suppliers’ employees, and in the communities where we operate. We know the personal, social and economic impact that poverty has on individuals and communities. We also know that the benefits of paying a living wage extend far beyond the individual employee.

I believe employment should lift you out of poverty and paying a living wage — one that reflects the actual cost of living — is an important and achievable poverty reduction strategy for many employers.

As an organization with more than 2,500 employees, 57 community branches and numerous suppliers, implementing the living wage has been no small undertaking; but it is one of which we are extremely proud. The knowledge and experience we have collected along the way is immense. So as a part of our commitment, we are documenting some of the challenges and solutions we encountered over the past two years across all our areas of business. In collaboration with the Living Wage for Families Campaign, we’ll be sharing them with other interested employers in the near future.

Today, we are happy to mark a new milestone in our commitment to the campaign by recertifying at the new 2013 living wage. This means we will continue to make living wage adjustments to the wages we pay our own employees. For Vancity, being a living-wage employer is another way we live our values and contribute to building healthy communities that are sustainable for the long term.

Read online