The real Living Wage in the London hospitality sector: opportunities and challenges

This report explores the opportunities and challenges of the implementation of the real Living Wage (rLW) in the hospitality sector in London, based on in-depth interviews with rLW-accredited hospitality employers and hospitality workers.

Interviews with the hospitality employers show that there are clear opportunities that come with rLW adoption. It helps employers to position themselves as an ‘employer of choice’, thus improving their ability to recruit and retain good staff. Some see rLW adoption as a way to help improve the image of the industry. Even where employers already pay at London Living Wage levels they see value in seeking rLW accreditation, as it comes with various reputational benefits, including the ability to credibly portray themselves as a reputable employer and trusted brand. Challenges include the need to carefully consider the balance between service charges and a higher base pay, the maintenance of pay differentials, and the incorporation of the rLW in annual budget planning.

Interviews with hospitality workers highlight financial and psychological benefits that those working in hospitality experience if they are paid a rLW as opposed to just a minimum wage. Findings also show that workers will only feel the full benefit of the rLW if they are offered sufficient and guaranteed hours; and if other aspects such as a good work environment, good additional benefits and development opportunities are available to them.

Based on the insights gained from the research, this report proposes a number of recommendations to promote rLW adoption in the hospitality sector aimed at hospitality employers, industry bodies, the Living Wage Foundation, as well as policy makers and government.

Copyright © the authors 2022
This work is licensed under Creative Commons Attribution International (CC BY 4.0). To view a copy of this licence, visit (https://creativecommons.org/licenses/by/4.0). For reuse or distribution, please include this copyright notice.