Is the Living Wage Policy Good - Essay Example

? Case Analysis- Wal-Mart al Affiliation: Case Analysis- Wal-Mart Introduction The basis behind a living wage idea is thatthe people working within the communities should be in a position that will allow them to be able to raise their families well and be able to live decently with the amount that they earn. This requires a benefit and wage package that accounts for the basic expenses and area-specific cost of living involved in supporting a family comfortably. By definition of their regions specific living wage standards are known to vary as compared to minimum wages offered by the federals. This is because the minimum wages do not begin to meet the family or the working people needs anywhere in the country; and on the contrary, it puts a child and parent below the poverty federal lines. This issue can effectively be addressed by the implementation of a more reasonable minimum and living wage at a local level that will not affect the family’s way of life. Our living wage standard like in many other municipal standards across the country combines some benefits with the wage standard to cater for employees and families that need it the most. The City of Washington, D.C government recently wanted to introduce a legislation that would ensure that large corporations running business in the city would pay a "living wage" of $12.50 per hour to all employees hired in the city. Wal-Mart, one of the largest business corporations in the whole world responded by threatening to close stores in the city, and not to open planned stores because of the legislation. Such policies are meant to protect the public from exploitation by business companies and to ensure that employees are well remunerated. Is the living wage policy good? The question whether the policy is a good one can be argued from both ways, but on this paper, the argument will lean more on the positive aspects of the policy. This policy is good and its implementation would be beneficial for the employees, future employees, the families of the employees and ultimately the city of Washington, D.C. One advantage that can be achieved through its implementation is that the minimum income of the citizens would rise considerably. This will help in improving the lives of the employees and enable them meet their basic and secondary needs. In addition, it is also beneficial to women because over time they have been earning lower wages than the men have. The wage policy will ensure than women and men earn similar salaries that are based on their skills and work rather than gender. In this aspect, the policy would benefit most families of the employees. Through this, it can be regarded as an added benefit to the recovery of the economy as a whole from the family level. Others still view its implementation as an indirect form of justice for those affected by the economy crisis since within its implementation, there are dockets that would allow for effective compensations and responsibility mainly by the employers and managements and this would in effect protect the workers from any form of abuse. The policy is also beneficial to companies such as Wal-Mart because an increased wage will ensure that the employees are motivated to perform highly and yield more and high quality productivity. Due to these facts, it is clear that the policy is a good one. The people who support the implementation of the living wage policy state that all individuals should be provided with direct means of affording living costs in-terms of shelter, food, transport and usual basic needs, fiscal conservatives. On the other hand, those who do not support it refuse to uphold the idea of a minimum wage since according to them it makes it hard to determine the regional scale cost of labor appropriately. They adequately argue that the minimum wage increases the services and goods prices while also affecting disproportionally the minorities. Even with this argument and counter argument, it is still unfortunate that a major aspect is still not answered by this debate and from this wide aspect, it is clear as to why the minimum wage policy should be increased, as counter measures for the unpredictable inflation rates. Its reasonability can be seen from the basis that it shows on small business there would be a 2-3 percent annual predictability increase if implemented. Such minimal increase would be easily manageable as compared to a drastic spike after long periods of being stagnant, which is what the economy is currently facing. Its reasonability is also seen by the way it eases government and taxpayers pressure to provide corporate welfare mainly in the forms of employee support. A large segment of the workforce buying power is raised and it in turn spurs the economy at a critical time that it needs the boost. It also helps gain lower turnover and more productivity when employees are compensated fairly (Rani &Belser, 2012). Different perspectives of the policy Liberal democrats embrace the wage policy stating that it should be accepted more and voluntarily as compared to being forced with it. This is mainly across the private and public sector. However, other stakeholders such as the labor union do not share the view of the voluntary living wage implementation supported by the democrats. In their perspective, they present the argument that forcing large companies to pay all the low-paid workers higher wages would not only be beneficial to the economy as a whole but it would also indirectly be helpful. This is because it will boost income and increase demand to the treasury income, as the tax revenues rise and the benefits in bill- in –work fail. The argument put forth by the democrats cannot work because; large corporations cannot voluntarily meet the wage needs of low paid employees easily, which has been shown by the threat brought forth by Wal-Mart. The divergent political stands view on the living wedge policy include; poverty being regarded by the conservatives, as mainly being caused by the poor people not working hard enough, or in other words they should consider themselves lucky and not complain since they have been given high discount rates. In this aspect they highlight the problem as a problem directly caused by poor choices by the under privileged in the society, which is reflected by their use of low efforts and how they highlight their efforts in fair returns. In contrasts the liberals view those in poverty as having some combination of perhaps having their wages being held down by monopolists and low marginal product, but in generally they are hard workers., Through the different political frameworks, welfare policies can be understood to imply differently through alternate translations. Conservatives never the less can be said to concentrate on the earnings and welfare of the poor, also keeping government smaller, so to speak. Personally, I think the minimum wages should be considered more than they are initially being done (Lee &Sobeck, 2012). What CEOs can do As a CEO, I would deal with this policy by first considering the pros and cons before making a decision to make threats, refuse or accept it. I would have sought a meeting with the government of the city of Washington D.C., to discuss the basis and ramifications of the policy. From this step, I would hold an indoor meeting with company executives to discuss about the policy and seek a way forward. In all these, the consideration of raisin the wage per her and its ramifications to the company, the employees and the city would be of utmost importance. I would consider helping with the introduction of policies that will help facilitate the living wages adoption. In addition, it will help with the security hours as part of their standards for minimal wages. Moreover, the CEO and management of the company can help provide guidance that would provide alternate or opposing leadership to counter the current culture of greed in the corporate sectors, which directly means there is unjustifiable senior managers exponential salary increase in the private sectors while employee wages are minimally screwed to be less. They can also adequately help with restructuring of the management salaries that will reduce their power and the initial funds wasted on their salaries would be redirected to the employees. If a job is lost because the company shut down If I am an employee working for a large corporation in Washington, D.C. and I lost my job because the company shut down due to the “living wage” policy, the entity that should take this responsible for your loss would be the company. As a worker, I help the company produce high quality products that are sold to customers helping the company gain millions of profits. Thus, the company should reciprocate and compensate me well for the services I provide it. If by virtue of forcing the company pay me what I deserve it closes down, then it should take responsibility for my job loss. In fact, this shows the failure of the company to be able to make a decision to pay me a reasonable wage bill to the extent that it should be forced to do that. Effects of large corporation’s withdrawal In cases that large corporate institutions pull out, the major effects on the governments would be more evident on the local and state government’s budget that is affected by the gap that is left by the employment the corporations currently envisions. Whether it is in sales, business or income tax used mainly to fund their daily operations the losses would be huge. When the cities businesses are doing poorly due to the economic downhill, the little tax that was initially filtered to the business and governments in form of the income tax will not be there because the people will be out of work. The withdrawal will also affect the lives of the people living in the city especially the employees who will lose their jobs. They may face difficulty in paying for their basic and secondary needs. They may also cripple businesses where they were the best of customers in the city. In addition, municipal and state services will be affected also directly due to the decreased taxes. The government, in this case, will be seen as conservative because of the opposing nature of the price of labor, free market and like all other comedies it is set by negotiations mainly between seller and buyer without any state based interferences. Corporate assist to the government The corporate makes an essential contribution to the society for helping the government achieve certain functions that would otherwise be difficult if the corporate were not present. I think that it is important for the corporate organizations to assist the government with the living wages since through the individual inputs the businesses would adequately be helped to pay or raise their needed living wages. By raising the needed funds the government can use the wages to assist the families to maintain their lifestyles and not be overwhelmed by the cost of living. This will also help the economy directly since it will be able to address the issue of minimum wage employees depending on corporate funds and indirectly help drive consumer demands The provided support to the government by the corporate world would allow it be able to save and redirect some of its funds to address issue like poverty, poor education, possible future under employment and the rampant job insecurity in the country. This assistance from the employees perspective would help reduces severe family financial stress and gender inequalities while indirectly promoting healthy child development and this shows the importance of corporate world assisting the government (Bennett, 2013). Changes to Canadian living wage policy The main changes that I would make to the Canadian living wages policy would include them embracing a municipal living wage ordinance policy that would dictates that there should be an increase in the minimum wage policies, to be able to cater for the current global recession which is affecting families badly and as seen initially changing this would greatly benefit the employees and their main families since they wouldn’t struggle too much to maintain their current lifestyles even though they are below the poverty line. In addition, this also includes fair wedge policy in their contractors and their municipals and this would go a long way in the provision of wages for the city and its infrastructures like sewer, roads and general maintenance. This implementation would be a relief, if compared to the required amount of the union rates for a similar amount of work. This will lower the municipals spending and therefore in theory most of the tax can be reduced for the common workers and be redirected to their monthly living wages. Reviewing the initially implemented employee policies, initiatives, placements and trainings to reflect the policy tools that would be considered as a workable living wage would be sufficient. This can be mostly consider as a liberal suggestion since even with its description it tends to lean more towards addressing employee issues and this is a core aspect of liberals. The main differences between the two countries policy implementation is that in Canada, it does not force the small companies to incur losses. In addition, it will not increase the unemployment rates. Conclusion Without the monetary policy reform needs being addressed, the living costs will always continue to increase along the lines of unpredictable inflation rates. The misguided notion that more expendable capital can be achieved more easily through the living wage ,though is well placed it does not consider the more wider or broader aspect of the U.S. currency continuous depreciation rates. Through this the Federal Reserve is sort of forced to pump faster cash into the U.S economy, while also ensuring that the artificial credit are slowed down as a means of guaranteeing that the low-income earners in the country benefit from the living wages implementation. This is evident from the simple fact that the proposed minimum wages would be worthless if the purchasing power of the people was not present. References Bennett, F. (2013). The ‘living wage’, low pay and in work poverty: Rethinking the relationships. Critical Social Policy, 0261018313481564. Lee, S., &Sobeck, K. (2012). Low?wage work: A global perspective. International Labour Review, 151(3), 141-155. Rani, U., &Belser, P. (2012).Low pay among wage earners and the self?employed in India. International Labour Review, 151(3), 221-242. Read More