The Warehouse Group pledges to pay a ‘living wage’

The Warehouse Group announced yesterday that it would introduce a ‘career retailer wage’ inspired, in part, by the ‘Living Wage’ campaign.

The Warehouse Group pledges to pay a ‘living wage’

The Warehouse Group announced yesterday that it would introduce a ‘career retailer wage’ inspired, in part, by the ‘Living Wage’ campaign. This will make it the first corporate in New Zealand to commit to providing its employees with a ‘living wage’, defined as the income necessary for workers and their families to obtain the basic necessities of life.

The wage will be available to all staff in the three wholly owned Warehouse companies: The Warehouse, Warehouse Stationery, and Noel Leeming. It will increase eligible employees’ pay to $18.50-$20.00 per hour - an extra $50-100 per week on average. To qualify, Warehouse Group employees will have to have three years’ experience and to have completed all the requisite training for their particular role.

The Warehouse currently employees around 7,000 staff and spends about 15% of its $1.1 billion revenue - $169.4 million – on employee expenses, the New Zealand Herald reported. The new wage is expected to cost up to $2.5 million in each of the first two financial years, 2014 and 2015. “[However], the impact on company profits is expected to be less due to increased team engagement, lower team turnover, improved sales and higher productivity,” Mark Powell, group chief executive, said.

“From the point of view of our people, and our business … we really do believe that if your team is engaged, they will serve your customers better, enjoy their job more, be more committed and, therefore, we see that [the wage] as part of the cocktail,” Powell said.

While Powell emphasised that pay was not everything, he said that the ‘career retailer wage’ was part of a wider desire on the part of The Warehouse Group to improve the perception of retail as a career in New Zealand. “I think unfortunately retail has had a fairly negative view in a lot of quarters, and we really want people to look at retail as an exciting career,” Powell said.

The move isn’t, however, revolutionary for The Warehouse Group. As Powell pointed out, The Warehouse has traditionally paid above the minimum wage, aligning that with skills-based training, as part of their ‘people-centred philosophy’.

“We’ve never paid minimum wage, and we’ve always been well above that, but I think the ‘living wage campaign’ earlier this year really acted as a catalyst for us to sit back and say, ‘Hey look, are we doing enough? And should we do more?’,” Powell said. “It really gave us more impetus to say, “Let’s be bold here and let’s do the right thing’.”

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