Do you earn a living wage?

24 Sep 2013 Voices

As his new social enterprise enters new territory, Robert Ashton ponders the issue of how much to pay himself.

As his fledgling social enterprise charts new territory, Robert Ashton ponders the issue of how much to pay himself.

My new social business has reached a new milestone. We're past the start-up phase, have a robust business plan and our first cohort of enterprise apprentices are recruited, placed and about to start their training.

This recently achieved level of stability has prompted me to consider pay. The enterprise already pays my former assistant who has been appointed project manager, but the accountant's advice is that I too need to join the payroll. To date I've benefitted personally from some start-up funding, but now it's time to put things on a more formal footing.

The company is limited by guarantee and I have recruited a non-executive board. They are brilliant, challenging me, as well as providing boundless support. I will expect them to sign off the salary I suggest the company pays me, for the 30hrs a week I am budgeting of my time. But here I face a conundrum. Do I ask for what the business can afford, the going rate for the job, or what I need to live on?

I have no mortgage and the kids have left home. My lifestyle is comfortable but modest. It is an interesting debate. I started this social enterprise to change the world, not make a fortune. Yet equally, I do not know what the future holds for me. I could find myself living long into my eventual retirement; I don't want to run out of cash before I run out of enthusiasm for life!

A coffee conversation with a very electable Labour party candidate for the next General Election reminded me that most have little or no say in what they are paid. It's very much 'take it or leave it', with Job Seeker’s Allowance the grim alternative. We talked about the living wage, a concept I'd heard about, but never really considered before. After all, I've been self-employed for more than 20 years and have always tried to pay well when an employer.

The living wage, considered to be an hourly rate of £8.55 in London and £7.45 elsewhere, is expected to feature prominently in the Labour Party election campaign. It makes sense to me, although many I know running their own business do not achieve this level of income. Publicans in particular would claim to work long hours for little reward.

But for most of us, I suspect paying the living wage represents no great challenge. Indeed if we run organisations with a strong social purpose, then looking after our own people should be a paramount objective.

But my new friend told me that encouraging people to pay the living wage is far from easy. There are two common objections. Firstly, that their employees are not worth paying that much, and secondly, that their business can't afford it.

I can't help but think these two points are linked. After all, the way to grow an efficient and profitable business is to grow the people who work within it. Motivated, adequately trained people make a massive difference.

But to do this means letting go, delegating and empowering others to make decisions for themselves. That's something I've found difficult over the years and, my team might say, I still struggle with today. But to me the only way we will see Britain's workforce paid a living wage, is for British bosses to become more confident, more democratic and above all, more willing to accept that often the people doing the job know more about it than they do!

As for my own pay, well predictably I went for a figure significantly less than the organisation could afford, but more than I need to live. I am after all, a social entrepreneur!

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