Living wage requirement for SIC business loans

Employees of companies seeking business loans from the council will  have to be paid the national living wage.

That was the decision made by councillors at a meeting of the special development committee on this morning.

The move means that any borrower who is also an employer will have to pay their employees the living wage as calculated by the Living Wage Foundation. That stands at £8.45, substantially higher than the £7.50 as determined by the UK government.

In the Autumn Statement, Chancellor Philip Hammond vowed to raise the national minimum wage for workers over 25 to that figure. But in light of the council’s decision employers in Shetland who are seeking business loans from the council will have to add an extra 95p to the hourly wage they provide.

The idea to make this stipulation was mooted by councillor George Smith last month, when he raised the matter at a meeting of the policy and resources committee.

At the time Mr Smith cited the council’s fuel poverty action plan, which stated that the SIC should encourage employers to pay a fair living wage, before arguing that the council should be “joined up in its thinking”.

Resistance

During that meeting Mr Smith was met with a smattering of resistance from councillors who argued that certain exceptions should be made.

Deputy leader Michael Stout argued that fledgling businesses might struggle to pay such a high wage and that the move could be seen as one blocking enterprise.

Meanwhile, Alastair Cooper, who chairs the development committee, argued that there were bothersome exceptions, such as fishermen whose pay is connected to the success of their boat.

Mr Cooper’s concerns were addressed in Tuesday’s report, in which it is said that “some businesses operate with workers who are self-employed or contracted. Such businesses would not be affected by this condition.”

When discussing the report on Tuesday Mr Cooper said that he was now “content” with the documents, and also sought to “commend” the work done by officials in bringing Mr Smith’s idea to fruition.

Mr Smith, who was not in attendance at Tuesday’s meeting, said afterwards that he welcomed the decision.

He said: “I’m obviously pleased with the decision as it shows that we’re linking up our policy thinking across the council.

“I think it’s only right that companies who are supported by the council should be encouraged to pay their employees a fair wage.”