Every day, workers head to factories, fields, mines, warehouses and other job sites across the world. There, they put in a full day’s work, contributing their time and labor to ensure the smooth running and expansion of businesses and, in many cases, the development of national economies as well.
More than 340 million workers are currently living with their families on less than US$1.90 per person per day.Yet, despite this contribution, day in and day out, many of these workers go home at the end of their long work days and still struggle to meet their basic needs and those of their families. Minimum wage laws in their countries may be weak or unenforced. The wages and any in-kind earnings they do receive are simply not enough to cover essentials such as nutritious food, clean water, sanitary housing, affordable health care, and opportunities for education.
The private sector’s role in these workers’ lives is immense. Wage-setting by employers – which in turn is regulated by governments and often influenced by the purchasing practices of those employers’ business partners – directly impacts the ability of these workers to live lives of dignity, through which their most basic rights as human beings are met.
Given this role, companies across sectors and geographies are asking, “What exactly is a living wage?” and “How can the provision of living wages be realistically achieved?”
In general terms, a living wage is the minimum income necessary for a worker and their family to meet basic needs, including some discretionary income. In many cases, a living wage is considered to be higher than the minimum wage set by national laws.
What this looks like in practice is very likely to vary across contexts and even within countries. But, as the case studies below aim to demonstrate, there are credible processes out there that are starting to set and implement living wages in real ways.
The provision of living wages for workers in global value chains could contribute to supporting entire families and communities in surfacing from conditions of poverty, fueling the economic and social development called for by both public and private actors in their endorsement of the SDGs.
Among others, the human rights to freedom of association, collective bargaining and non-discrimination are key drivers in supporting the provision of a living wage, which in turn can contribute to the fulfillment of the human rights to food, water, health, adequate housing, education, family life, fair working hours and so on.
As illustrated in the graphic above, and depending on the specifics of the relevant corporate initiative, the provision of a living wage may contribute to the achievement of an array of Global Goals, including:
More than 450 million people work in global supply chain-related jobs. When combined with these workers’ families, the number of individuals directly affected by wage-setting in global value chains rises to 2 billion.
So, how are companies currently demonstrating respect for human rights and supporting a world in which these goals can become a reality – a world in which workers earn living wages such that they and their families are meeting their basic needs?
Examples illustrated by the case studies below include:
These case studies explore each of these innovative and evolving models in more detail. Each case study captures publicly available information on the initiative, alongside experiences and opinions from various actors involved.
The following summaries do not claim to give a definitive account of a specific initiative or of all perspectives on that case study; instead, they are intended to serve as illustrative examples of how action toward corporate respect for human rights can make a critical contribution to the achievement of various goals and targets under the SDGs.