Exclusive: Let firms who pay living wage and treat staff well boast new ‘kitemark’, Lib Dem hopeful Layla Moran says
Businesses who pay the living wage would qualify for a kitemark (Credit: PA)
Businesses who treat their staff well and pay the real living wage should be rewarded through a new “kitemark” system, exposing those who fail to take care of employees properly, a Liberal Democrat leadership challenger has said.
Layla Moran, who is battling it out with former Cabinet minister Ed Davey for the party leadership, called for ministers to recognise responsible businesses and help consumers make more informed decisions about who they support.
To qualify, firms would need to meet standards in seven areas, including paying the real living wage; scrapping penalities for legitimate sickness; worker representation; diversity; environmental responsbility; tax fairness and paying suppliers in good time.
"Companies up and down the country are doing great things to support their employees, customers and the environment, with many aspiring to do more," Ms Moran told PoliticsHome.
"This plan would allow us to make business more caring, more liberal and more compassionate. It will also show you can do the right thing and make a profit."
The real living wage, calculated annually based on actual living costs, is currently paid by about 6,000 UK employers.
Government rules currently see businesses called out for failing to pay their workers the National Minimum Wage (NMW), with those who owe arrears of more than £500 in NMW payments to their workforces named publicly. The previous threshold was just £100.
When the guidelines were changed in February, business minister Kelly Tolhurst said: "Anyone who is entitled to the minimum wage should receive it – no ifs, no buts – and we’re cracking down on companies that underpay their workers.
"We also want to make it as easy as possible for employers, especially small businesses and those trying to do right by their staff, to comply with the NMW rules, which is why we’re reforming regulations."
Former Chancellor Sajid Javid had wanted to raise the living wage to £10.50 an hour for all workers over the age 21 by 2024. The current rate is £8.72.
Figures suggest more people are taking ethics into account when buying, with £83bn spent on "ethical goods" in 2017 and more than 70% of millennials saying they would pay more for products produced with good standards in mind.
Ms Moran added: “This kitemark would provide a simple and effective way for some firms to demonstrate that they are a force for good by improving engagement and sharing prosperity with communities up and down the country.”