The cleaner
Katy Rojas, until recently a cleaner at the Foreign and Commonwealth Office (FCO) earning £7.04 an hour, lies to her friends when they invite her to the cinema or pub. She’d would like to go, but cannot afford it.
“It’s embarrassing,” she said. “I have to lie and say I am not feeling well. People who receive benefits and aren’t working get a better life.”
From Friday people like Rojas, 44, will earn a little more – £7.20 an hour under the new “national living wage”. But she reckons it is nowhere near enough for a dignified life in London.
“The rent, the transport, the food is so expensive,” she said. “We work hard but we can’t have a normal life.”
After deductions, her monthly take-home pay from full-time work cleaning toilets, offices and kitchens at the FCO starting daily at 6am was £980. After £600 rent and £63 council tax, she often relies on a credit card to pay bills. Holidays are a dream.
“I have wanted to pay a visit back to Ecuador [her home country] for many years, but it is impossible,” she said.
Rojas was one of several cleaners at the FCO who last July left a letter on the desk of the new secretary of state, Philip Hammond, telling him the new wage was too low and offering to “share with you our stories of living below the breadline in London”. She lost her job working for the contractor Interserve and is now taking the company to an employment tribunal claiming it was because she spoke out, an accusation the firm denies.
“After paying bills there is nothing left for me,” she said. “People are killing themselves working 12-hour days just to get enough money.”
The hotel owner
Tim Chudley sees his hotel business as working proof that a higher minimum wage need not cost jobs or profits.
Last year, his company’s Barnett Hill hotel and conference centre in Surrey became the first in the UK to commit to paying all its employees the living wage – a voluntary minimum wage paid by some 2,300 employers in the UK, higher than the sum introduced by George Osborne.
That means the family-run business, Sundial Group, pays at least £8.25 an hour to employees at the hotel – already well above the new national living wage of £7.20 that comes into force on Friday.
Bringing in higher wages was a brave decision in a fiercely competitive industry that has been struggling with oversupply and a lack of demand from cost-conscious business customers ever since the financial crisis. Chudley knows his sector is generally seen as a poor employer.
But that was part of the attraction of joining the Living Wage movement. “It is difficult. We have to compete head to head on a price, particularly in our area of business clients ... It’s a very competitive market and since 2006 it’s a very oversupplied market. So it’s become more important to differentiate ourselves,” he says.
That bid to stand out and emphasise the customer service benefits of better motivated staff has paid off with corporate clients, says the hotelier. In the company’s last full year turnover was £10m, up about 10% on the year before.
“You can hire the best people, you can motivate them and engage them and the product in hospitality is about that engagement. I see it as an investment in our business,” says Chudley.
He believes that being an owner-managed company helped make signing up to the living wage easier, given a more long-term approach to running the business. It was set up by Chudley’s parents, who bought a run-down country house in Northamptonshire in 1964 and turned it into a guest house and a home for their nine children.
Sundial now runs three hotels in Northamptonshire, Warwickshire and Surrey that host conferences and training events for businesses as well as weddings. It has 220 employees.
Chudley says raising pay at the Surrey hotel to the living wage was easier than it would be for the Midlands sites, where wages tend to be lower in the sector. But he plans to get those hotels accredited on the living wage scheme by the end of 2017.
“The key to good hospitality is having the right people at the frontline and also that the people doing that job can feel proud of the job they do and feel that it’s recognised by senior management.”
