Cambridge council to investigate paying staff at its contractors a £10 minimum wage
PUBLISHED: 19:00 06 October 2018
Feasibility study examines propect of increasing hourly rate of contracted and subcontracted workers
Cambridge City Council is looking at proposals that would see staff at its contractors paid a minimum wage of £10 an hour.
Figures contained in a council report suggest the idea could cost the local authority up to £1.6million over seven years – the length of one of the longer agreements. The estimated cost for 2019 alone is £316,000.
The city council already pays its staff a minimum of £10 an hour and has insisted that its contractors pay at least the real living wage – £8.75 an hour.
However, a report for the strategy and resources scrutiny committee, which meets on Monday (October 8), looks at the feasibility of increasing the hourly rate of contracted and subcontracted workers. The report was requested by full council following a meeting in May of this year.
Officers report that they have identified five contracts where the change was likely to have an impact – others already paid staff above the target sum or were unable to provide the necessary information.
Focusing on four contracts, the report says: “The total indicative annual cost of applying the £10 per hour minimum rate to the four contracts identified is likely to be around £316,000, based on the information provided by current contractors. Over the remaining duration of the four contracts, which will run from 21 months to seven years, including periods of extension, the total indicative cost is around £1,640,000.”
However, officers also point out that the costs could reduce as the real living wage increases, closing the gap on the £10 target proposed by the city council.
The report adds: “If the council decided to require its contractors to pay qualifying staff a minimum of £10 per hour for work on council contracts, this could have a positive impact on employees through increasing their pay rates. This could help employees who live in Cambridge, or have to travel into Cambridge for work, to meet high costs of housing and transport for staff in the city on low pay.
“If the council was to implement the proposed change to suppliers’ minimum rates of pay to £10 per hour, the positive impact this will have on staff will decrease over time, as the national living wage and the real living wage rate increases.”
The council, if it agrees to push ahead with the idea, would have to include the extra spend in its budget and consider adjustments to its procurement processes.