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A living wage

Average read time: 7 minutes

Workers deserve a living wage – and fair pay brings benefits for families, communities and our business. We want to raise living standards across our value chain.

Middle aged woman in a hat holding her hand up to show her palm

Fairer pay for a fairer world

We know that economic growth is only inclusive and sustainable when workers receive fair wages. And that our business flourishes when those around us are doing well. Making sure that workers earn a living wage helps support economies and fosters growth. And it’s simply the right thing to do for a business that is founded on respect for human rights. So we’re advocating living wages through many platforms and building alliances to create momentum for the change we want to see.

Our living wage commitment for employees

We created our Framework for Fair Compensation (PDF 192 KB) in 2014. Through the first of its five principles we committed to pay all our employees a living wage. We’ve updated our Code of Business Principles to endorse this commitment.

Every year, our country leaders confirm that they have complied with our Code. And we require each country business to report its status against the standards of our Framework.

We check we're paying our employees a living wage by auditing compliance against our Framework each year. Our audits check that:

  • fixed compensation is achievable without the need to work an excessive number of hours
  • our country payroll processes deliver employees’ full pay correctly and on time, every time
  • we have no issues of unequal pay between genders.

We’ve worked closely with the Fair Wage Network (FWN) and others to develop our understanding of living wages. FWN provided an objective external source of the living wage amount for each of the countries where we have employees.

Fork lift truck driver moving a pallet of cardboard boxes labelled OMO in China

We used these thresholds to assess whether the fixed compensation paid to all our full-time direct employees (including factory and non-factory employees) in each country met our living wage standard – which means employees receive, at the very minimum, fixed and guaranteed levels of earnings that are above their country’s or location’s living wage benchmark. In some countries, such as those under the Gulf Cooperation Council, there are no legal minimum wages mandated by the government – which meant we needed to identify a substitute for the legal minimum wage as an initial wage floor or starting level.

A factory worker scans a stack of cardboard boxes

We’re an accredited living wage employer

In 2021, we were awarded our first global independent accreditation as a living wage employer from the Fair Wage Network, and continue to pay a living wage to all our employees globally.

Extending our approach

Fair wages have always been a principle of our Responsible Sourcing Policy (RSP) (PDF 8.25 MB) and Responsible Business Partner Policy, which include the Mandatory Requirements our partners must meet to do business with us. In 2022 we replaced these two policies with our Responsible Partner Policy (PDF 4.45 MB) (RPP), and in line with our commitment for our own employees, it includes the Future Mandatory Requirement for suppliers to pay a living wage to their workers. See Human rights in our value chain and Becoming a Unilever supplier for more detail.

To make our living wage goal a reality, we’ve put an action plan in place that builds on the progress made by looking at where the gaps between actual and living wages are greatest, where the social safety net for workers is weakest, and where we can make the most impact, based on our presence and scale in local markets.

We’re prioritising our dedicated collaborative (third-party) manufacturing sites to close the living wage gap in workers’ wages. For our agricultural supply chain, we’re focusing on crops with heavy reliance on smallholder farmers that are important to our business. After assessing living income gaps for the smallholder farmers of these crops, we’ll prioritise key crops and develop tailored implementation plans.

Women working at computer screens in an office

Partners with purpose

Through our Partner with Purpose programme for suppliers, we’re finding innovative and impactful ways to deliver on our ambitious commitments and generate mutual growth.

Advocacy for change

Advocacy and collaboration play key roles in our efforts to raise living standards through living wages and incomes, because all stakeholders – companies, governments, investors, NGOs and trade unions – must be involved in mainstreaming living wages.

We’re advocating living wages through existing multi-stakeholder platforms, forming new public–private alliances at a country level and engaging in dialogue with governments.

We aim to mobilise like-minded companies to close the gap between minimum and living wages and incomes in their operations, influence governments to institute and implement living wage and income policies, and to build cross-sector coalitions to drive systems change on living wages/incomes.

Reginaldo Ecclissato

It’s time to rewrite the narrative: living wages are not a cost to businesses, they are a measurable and tangible contributor to business success.

Reginaldo Ecclissato, our Chief Supply Chain and Business Operations Officer

We’re encouraged to see the progress being made through public statements of support for living wages, such as those made by the United Nations Global Compact, Business for Inclusive Growth, IDH and AIM-Progress. However, we need to see accelerated action from all stakeholders.

To further advance the movement, we facilitated the publication of The Case for Living Wages, a research paper that analyses how paying living wages improves business performance and tackles poverty. We also signed United Nations Global Compact’s Forward Faster on living wage and encouraged others to join in over a dozen markets throughout 2023.

We’re seeing growing momentum on living wages, including from our investors. For example, the Platform for Living Wage Financials is an alliance of 19 financial institutions managing over €6.5 trillion of assets, which encourages and monitors companies' efforts to address living wages and incomes in their global supply chains.

Similarly, we’re seeing a more aligned approach from expert organisations working on living wage methodologies and data, which is an essential step in progressing this complex agenda. For example, we are supporting the creation of a publicly accessible, global database of living wages as we believe that making living wage data available free of charge to all supports and facilitates widespread living wage implementation.

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