What is living wage?

What is living wage?

In this article, we want to define living wage and minimum wage, but also keep you a deeper understanding, why we need living wage and what impacts it can have worldwide. Let’s start with the definitions!

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Living wage is a wage that is high enough to maintain a normal standard of living. We are sure we can all agree on the basics needs include food, housing, utilities, health care, transport and childcare. Basically, with a living wage, a person can afford necessities of living in modern society. [1] However, the living wage is an informal benchmark, not a legally enforceable minimum wage as the national minimum wage is, which in many countries is below living wage. [2]


Minimum wage means the wage level the government sets in the country. That is the minimum salary level the companies need to pay for their workers. The legal minimum wage level differs from country to country depending on the general level of salaries and expenses in a country. Among many other articles, Guardian wrote the minimum payment doesn't cover all the basic costs of living [3].


International Agreements & European Union

Various international treaties and agreements go along with human rights and the basic standard of living. Yet, they fail to state directly about living wage.

“All workers have the right to a fair remuneration sufficient for a decent standard of living for themselves and theirfamilies.” - European Social Charter (Council of Europe 1961)


The Universal Declaration of Human Rights (UDHR) and the International Covenant on Economic, Social and Cultural Rights (ICESCR) include rights to a standard living meaning food, clothing, housing, medical care and necessary social services. ICESCR lists the rights for social security including social insurance and right to family life inclusive parental leave. [4,5] Also, the Community Charter of Fundamental Social Rights for Worker (EU Social Charter), adopted in 1989, established the major principles for social rights including articles on living and working conditions, social protection, equal treatment and health and safety at the workplace. This Charter became legally binding in the ratification of the Lisbon Treaty in 2009. [6]


Ethics & living wage on Népra blog Speak Of The Frog


International frameworks state that it is a business responsibility to respect human rights; the UN Guiding Principles on Business and Human Rights is an instrument that proves a global standard for preventing and addressing the risk how certain business activities impact on human rights. However, it is a responsibility, not a legal obligation. The UN Guiding principle states regardless of their size, sector, operational context, ownership and structure, all enterprises are responsible to protect and respect human rights worldwide. The corporate responsibility isn't limited to any national borders or to headquarter, but the businesses must take responsibility in the whole supply chain. Even when a state is not able to protect human rights themselves, a business must respect them. [7]


"The corporate responsibility is not limited to any national borders or to head quarter but businesses must take the responsibility in the whole value chain.”  From the UN Guiding Principles on Business and Human Rights

Connections to Poverty

The concept of living wage goes beyond the industry borders and isn't just an issue in the textile industry. However, the garment industry is one of the most labour-intensive industries, and living wage would change the lives of millions of people. It would be a tremendous step to fight against property worldwide.

People who try to survive with less than living wage, will stay in poverty and suffer from poverty-related issues. When a person must constantly worry whether the money is enough to cover the basic needs to him/herself and the family, it is more likely that the person has limited access to health care and education, lacks social security, has poor housing and doesn’t take part to cultural and political life. Often when living in poverty, people feel they have no power or control of their lives either and that denies basic human rights from these people. [8]


Ethics & living wage on Népra blog Speak Of The Frog

Thus, the human right to a living wage is an enabling right. Having enough money enables a person, household, local economy and national economy to develop. If certain countries are only seen as a source of cheap labour, it is a dead-end to the economy, and they can hardly develop beyond a certain level of income-poverty. [8]

You can see that living wage is a very complicated issue that partially lacks legal obligations. We hope this article brought a bit of clarity and you understand the connections between poverty and garment industry a bit better.


Even a small decision as which t-shirt to buy has an impact on other beings on the planet. If you want to go beyond thinking about your habits, you can always actively demand your favourite brands to answer questions like who made my clothes.

Also, if you want to dig deeper on the international treaties, we have linked those mentioned in the article below as well as linked the previous articles on this topic on Speak Of The Frog.

Ama & Essi

Photos by Julius Töyrylä

Népra blog Speak Of The Frog Living wage
Previously on Speak Of The Frog:
Does it make a difference to buy eco & fair?
Ethics in the garment industry
  1. Wikipedia: Living Wage
  1. Clean Clothes Campaign
  1. Guardian: National minimum wage rise still fails to cover living costs, study shows
  1. Wikipedia: Universal Declaration of Human Rights (UDHR)
  1. Wikipedia: International Covenant on Economic, Social and Cultural Rights (ICESCR) 
  1. Community Charter of Fundamental Social Rights for Worker
  1. UN Guiding Principles on Business and Human Rights
  1. Stitched up: poverty wages for garment workers in Eastern Europe and Turkey
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