Paying living wage would force Students’ Union trading company into bankruptcy
However, paying the living wage of £7.85 plus holiday pay would cost the Students’ Union an additional £136,000 per year.
The company normally makes a surplus of around £120,00 per year meaning the pay increase would force the company into bankruptcy as well as taking away from the Union’s main budget, according to Operations Officer Dan Greenberg.
In a meeting with the Living Wage Foundation it was suggested that the living wage, currently £7.85 per hour, could include a proportion of holiday pay entitlement.
However, the Foundation has since told the Union that the information they provided previously was incorrect. This means that the Students’ Union would only to awarded living wage accreditation if they pay a wage of £7.85 per plus holiday entitlement.
The initial proposal set by Sussex Students’ Union included a succession of eight 10p wage increases, one increase per quarter, over a period of two years from May 2015-February 2017, leaving a total additional cost to the Union of £78,200.
Although this proposal will move Sussex closer towards the living wage, it may will not allow them to receive accreditation.
Dan Greenberg has said: “The feedback from the most recent news has been understandably mixed. There are a range of opinions among our outlet staff, and the mixed messages from the Living Wage Foundation themselves hasn’t made communicating our progress to staff and students any easier.
“The most recent plan to implement a pay increase presented to staff proposes increasing pay gradually, giving a pay-rise for all part-time staff every three months. We’re currently in the process of receiving feedback on this option.”
In an email sent to Union Shop staff, Co-op staff and bar staff, he wrote: “There is no reason why we shouldn’t continue to work towards this if the company continues to perform well and grows. Using the initial proposal of 10p increases per quarter to reach living wage plus holiday entitlement would take a minimum of four years.”
He added that uncertainty in the demolition of East Slope and the move out of Falmer House into a new building “could delay this a fair bit”.
A staff member at the Co-operative said that: “While it would be great to get paid the living wage, I understand that it should not be introduced at all costs.
“If they were to introduce the living wage on their current budget, the amount of jobs that could possibly be cut to implement the scheme.”
Rosie Dodds and Jessica Pitocchi