A new living contract: cases in the implementation of the Living Wage by British SME retailers
| Published date | 02 October 2017 |
| DOI | https://doi.org/10.1108/ER-07-2017-0150 |
| Date | 02 October 2017 |
| Pages | 850-862 |
| Author | Andrea Werner,Ming Lim |
| Subject Matter | HR & organizational behaviour,Industrial/labour relations,Employment law |
A new living contract: cases in
the implementation of the Living
Wage by British SME retailers
Andrea Werner
Middlesex University Business School, Middlesex University, London, UK, and
Ming Lim
University of Liverpool Management School, University of Liverpool,
Liverpool, UK
Abstract
Purpose –The purpose of this paper is to provide evidence for the motivations of SMEs for introducing the
Living Wage (LW), focussing on retail as one specific sector. It develops understanding of the strategic
benefits and challenges these employers face in balancing financial, ethical and social considerations in
small businesses.
Design/methodology/approach –The study employed mixed methods: a survey and semi-structured
interviews. The interviews are presented as part of three case studies.
Findings –Findings indicate that employers were, for the most part, motivated by personal ethics and
beliefs about fair wages and social justice. They suggest that SME accrue benefits from LW accreditation
such as reputational benefits and higher employee morale, but that there are also potential pitfalls of LW
adoption related to pay structure and incentives. The sustainability of the LW emerged as an issue in terms of
the long-term strategy and brand positioning of the companies involved.
Research limitations/implications –The nature of the research was exploratory and thus the study only
allows for limited generalisation. Recommended avenues for further research include gathering data from
different levels of organisations and from different stakeholders.
Originality/value –This is the first paper to investigate the drivers for, and implementation of, the LW in
SMEs. The specific characteristics of SMEs –their ethos, low visibility, reliance on trusting relationships and
limited resources, among others –make the study of why and how they choose to implement the LW very
interesting. This study is the first to gather and analyse data from SME retailers and wholesalers that have
implemented the LW.
Keywords United Kingdom, Casestudies, Ethics, Living wage, Small- to medium-sizedenterprises (SMEs),
Retail/Wholesale
Paper type Research paper
Introduction
Over the past few decades, developed economies in the west have continued to grapple with
a series of seemingly intractable problems in the context of labour productivity, intense
competition from emerging markets, the rise of low-skilled and low-paid jobs, chronically
un- and underemployed workers and stagnant or decreasing wages (Eurostat, 2016;
Clarke and D’Arcy, 2016). The more recent rise of the “gig economy”involving zero-hour
work contracts and “forced”self-employment has further intensified employer-employee
conflicts (Pennycook et al., 2013; Broughton and Richards, 2016).
Employee Relations
Vol. 39 No. 6, 2017
pp. 850-862
Emerald Publishing Limited
0142-5455
DOI 10.1108/ER-07-2017-0150
Received 5 July 2017
Accepted 6 July 2017
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0142-5455.htm
© Andrea Werner and Ming Lim. Published by Emerald Publishing Limited. This article is published
under the Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute,
translate and create derivative works of this article (for both commercial and non-commercial
purposes), subject to full attribution to the original publication and authors. The full terms of this
licence may be seen at http://creativecommons.org/licences/by/4.0/legalcode
The authors would like to thank the Barrow Cadbury Trust for funding this study and the Living
Wage Foundation for its assistance in gaining access to respondents.
850
ER
39,6
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