The living wage as an income range for decent work and life

Date02 October 2017
Pages875-887
Published date02 October 2017
DOIhttps://doi.org/10.1108/ER-03-2017-0071
AuthorChristian Yao,Jane Parker,James Arrowsmith,Stuart C. Carr
Subject MatterHR & organizational behaviour,Industrial/labour relations,Employment law
INTERNATIONAL
The living wage as an income
range for decent work and life
Christian Yao
School of Management, Victoria Business School,
Victoria University of Wellington, Wellington, New Zealand
Jane Parker and James Arrowsmith
School of Management, Massey University, Auckland, New Zealand, and
Stuart C. Carr
School of Psychology, Massey University, Auckland, New Zealand
Abstract
Purpose Alivingwage (LW) is conventionally defined as enabling meaningful participation in
society above subsistence through, for example, recreation, supporting a family, and savings. There is
increasing debate over LWs due to growing inequality, rising living costs and welfare reform but this remains
largely framed by the econometric cost-benefit parameters that apply to minimum wage regulation. The
capabilities approach advocated by Sen (1999) offers a different perspective that is inclusive of choice,
contingencies and the inter-connections between quality of (paid) work and private life. The paper aims to
discuss these issues.
Design/methodology/approach The paper adopts this framework and utilises a qualitative
exploration of the narratives of 606 New Zealand employees to understand perceived wage effectiveness.
The results suggest that a focus on a specific LW rate might be conceptually limiting, in comparison to
a LW range.
Findings First, the findings indicate that there is a pivot range in which people move from self-assessed
survivalto decentincome. Second, a LW may have more than a simply monetary effect in better meeting
employeesliving costs; it can also improve well-being through subjective perceptions of valued freedoms to
do with job satisfaction, equity and security.
Originality/value The results thus draw attention to a wider notion of a LW in terms of personal and
family well-being, utilising a capabilities approach, with implications for organisational practice, policy and
theory concerning sustainable livelihood and the UN Sustainable Development Goals.
Keywords Quality of working life, Decent work, Human capabilities, Living wage
Paper type Research paper
Introduction
Most countries regulate pay through minimum wages, usually by law but also through
collective bargaining (International Labour Organization, 2013). Wage minima may vary by
sector, region or individual criteria such as age but the arrangements are usually designed
both to provide a degree of income protection for workers, in combination with transferable
benefits, and to prohibit unfaircompetition based on labour exploitation.
The declining wage share, rising inequality and increased cost of living observed across
the developed world has recently shifted attention to decentincome levels beyond
Employee Relations
Vol. 39 No. 6, 2017
pp. 875-887
Emerald Publishing Limited
0142-5455
DOI 10.1108/ER-03-2017-0071
Received 31 March 2017
Revised 7 June 2017
Accepted 28 June 2017
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0142-5455.htm
© Christian Yao, Jane Parker, James Arrowsmith and Stuart C. Carr. 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 derivativeworks 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 thank the Massey University Vice Chancellors Discretionary Fund for supporting this
research. The comments of the editors and anonymous referees were also very useful in developing the
paper. The authors also appreciate the study participantswilling and generous input.
875
LW as an
income range
for decent
work and life

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