The International Labor Organization (ILO) recently held a deliberation and made recommendations on living wage policies for countries around the world.
The ILO governing body at this most recent session approved the agreement which was initially concluded on at an expert meeting on wage policy earlier in February.
The meeting was aimed at reviewing wage setting processes and current living wage initiatives, define living wages and examine how the ILO can support its constituents in wage policy.
Therefore, the meeting set out key institutions and principles for wage setting, with an emphasis on collective bargaining, taking into account workers’ needs and economic factors, promoting gender equality, using reliable data and adapting to national circumstances.
Chairing the meeting was Zaskia Nathalie Cely and other attendees were representatives of governments, employers and workers, as well as observers.
The experts agreed that living wages are essential for economic and social development and the promotion of social justice. They also play an essential role in reducing poverty and inequality and ensuring a decent life.
According to experts, the concept of a living wage refers to “the level of wages necessary to provide workers and their families with an adequate standard of living, taking into account the circumstances of the country and calculated for work performed during normal working hours.”
While there has been a positive long-term global trend in average wages, millions of workers worldwide, spanning both formal and informal economies, still earn wages significantly below the cost of living, trapping them in poverty.
The agreement states that the estimation of living wages should follow a number of principles, including the use of evidence-based methods and robust data, consultation with workers’ and employers’ associations, transparency, public availability and consideration of regional and local wages Contexts and socio-economic and cultural realities
Living wages must be achieved through wage-setting processes consistent with ILO principles. This includes strengthening social dialogue and collective bargaining as well as strengthening the institutions that set wages. The document also reminds that “The needs of workers and their families and economic factors are the two pillars of wage setting processes.”
“Living wages should not be a one-size-fits-all approach and should reflect local or regional differences within countries,” says the document setting out the details of the living wage agreement, adding that a sustainable strategy to promote living wages should go beyond the scope of wage setting mechanisms and include a broader consideration of factors.”
Further, it was agreed that to achieve living wages, wage-setting processes should align with ILO principles. This entails bolstering social dialogue and collective bargaining mechanisms and empowering wage-setting institutions.
