You are viewing 1 of your 1 free articles
Why we will only work with suppliers and contractors who pay the real living wage
We’ve already paid the Living Wage Foundation’s recommended rates to directly employed colleagues for over a decade, but now we’re taking it further, writes Terence Wong, strategic commercial director at L&Q
Terence Wong is strategic commercial director at L&Q
We’ve already paid the Living Wage Foundation’s recommended rates to directly employed colleagues for over a decade, but now we're taking it further, writes Terence Wong, strategic commercial director at L&Q #UKhousingWhat makes people feel motivated to do a good job? Most of us would say: being treated fairly and paid properly, and feeling that what we do matters. Yet for too many people, that basic fairness is still out of reach.
In London alone, over 574,000 people are in low-paid work. That’s around 13% of all jobs in the capital. In Greater Manchester, where L&Q also manages homes, that figure is around 193,000, or 16% of the region’s workforce. The gap between what people earn and the cost of living keeps growing.
Housing associations play a vital role in reducing inequality and creating opportunity – from the social homes we manage to the support services we provide. At L&Q, we’re increasingly looking at how we can use our spending power for social good. Our decision to become a Living Wage Employer was rooted in this.
We’ve already paid the Living Wage Foundation’s recommended rates to directly employed colleagues for over a decade. Our formal accreditation means that from April 2028, we’ll only work with suppliers and contractors who do the same.
The Real Living Wage is the only UK wage rate based on the cost of living – set to increase to £13.45 in the UK and £14.80 in London this year. For a full-time worker, that means a salary that is worth over £2,418 more a year than the legal minimum wage, or £5,050 more in London. For someone struggling to cover their rent, bills and the costs of essentials, that difference could be transformative.
Our supply chain is substantial: we spend around £1.2bn each year on materials, labour and services, contracting with around 4,500 organisations. Many of these firms are rooted in the communities we serve.
By making our contracts conditional on fair pay, we can drive up wages in the places we operate – and help tackle in-work poverty too.
We started this journey by working with the Living Wage Foundation to review our supply chain and identify where lower-paid roles were most likely to be. We focused on sectors like cleaning and security, and discounted professional services firms that typically pay more. We reached out to suppliers to understand their circumstances and readiness to adapt.
Change doesn’t happen overnight, and the Living Wage Foundation recognises that. We’ve agreed a phased approach so that existing contracts can run their course. We’ll use this time to work with partners to ensure they pay the real Living Wage by our deadline.
The response so far has been encouraging. Generally, we’ve found that larger organisations have felt more comfortable adapting quickly. Understandably, some smaller firms have raised concerns about the costs involved. We’ll work together to help them make the transition. That could mean finding efficiencies, or even exploring opportunities for them to take on larger contracts or provide additional services.
“At L&Q, we’re increasingly looking at how we can use our spending power for social good”
People are the greatest asset for any organisation, and there’s strong evidence that paying the Real Living Wage brings benefits. 94% of Living Wage Employers report advantages, from improved recruitment and retention to a stronger reputation.
But beyond organisational gains, this is fundamentally about fairness and respect. Everyone should be able to live with dignity and feel valued at work.
As a social housing provider, we have a clear mission. To provide safe, decent and affordable homes, and reliable services for the people who live in them. We’ll only succeed if everyone involved in that mission is supported and motivated. The people who clean, maintain and keep our buildings safe are essential, as is the whole ecosystem of firms that help make this happen.
We’re proud to be on this journey with our supply chain. By taking a values-led approach to how we spend money, we can build stronger partnerships, deliver better services and support more resilient communities.
Terence Wong, strategic commercial director, L&Q
Related stories
