Scottish Chambers of Commerce calls for help to support Sturgeon’s ‘living wage’ pledge

The Scottish Chambers of Commerce has called for relief on taxes and employers’ contributions to help meet the Scottish Government’s plan to see all firms pay a “living wage” to employees.

The initiative was launched yesterday by First Minister Nicola Sturgeon in her first major speech delivered since the SNP’s landslide General Election result in Scotland earlier this month.

Ms Strugeon used the address to unveil her “Scottish Business Pledge” and encourage Scottish companies to sign up to a voluntary code for employers to recognise “fair and progressive” business policies.

She called on businesses to commit to paying the living wage – which is set at £7.85 an hour outside of London, compared to a minimum wage of £6.50 an hour for adults.

In addition, the pledge spans nine criteria including commitments to youth training and gender balance across the workforce.

Companies signing the pledge are to pay the living wage to all employees over 18 as well as deliver on at least two other elements while committing to achieving the rest over time.

However, chief executive of the Scottish Chambers of Commerce, Liz Cameron, was guarded in her reception of the proposals and warned that it was “not the time” to add burdens to businesses.

While stating that Scottish firms share the values of internationalisation, innovation, gender balance and positive workplace practices, she said: “The success of the Scottish Government’s Scottish Business Pledge will be in how it supports those businesses that currently fall short of meeting its criteria.

“Whilst 81 per cent of employees in Scotland are already earning the living wage or above, there are some businesses which, whilst meeting their legal requirements under the minimum wage, currently cannot afford to pay the higher living wage to all staff, based on their existing business models.

“Perhaps this could be achieved through a commensurate reduction in employers’ national insurance contributions or through targeted additional relief on business rates?”

Meanwhile, the first minister and Finance Secretary John Swinney met with Ann Budge, chairwoman and chief executive of Heart of Midlothian Football Club, which became one of the first companies to commit to the pledge.

Mr Swinney said: “There is a large body of credible evidence that shows progressive workplace practices, like workforce engagement, taking an active role in the community and investing in innovation, benefit companies through increased productivity, enhanced employee commitment and improved reputation.

“With the living wage at its core, the pledge covers issues such as zero hours contracts, investing in young people, pursuing innovation and internationalisation and progressing diversity.”

MsBudge added: “By introducing the living wage across our business, by investing in youth education and staff education, by engaging fully with the community and by working closely with the Foundation of Hearts to introduce fan ownership, we are the perfect match for this initiative.”