Providing a Living Wage for Staff

National Church Residences began thinking of a strategy to provide a “living wage” to all staff for a variety of reasons. National Church Residences wanted to be an “employer of choice” for potential candidates in a competitive market, and were concerned that employees worked full-time within their communities yet still fell below federal poverty levels. Raising salaries would be consistent with its mission. National Church Residences a large organization it has 3,000 employees, 340 locations in 25 states and in Puerto Rico, and 43,000 clients and while it was fortunate to be able to undertake this effort, the plan took planning and commitment as it would for any size organization. Danielle Willis, Senior VP of Human Resources, led these efforts.

Solution:

Working with other senior leadership, Willis created a five-year plan for implementing a “living wage” proposal that could be presented to the Board of Directors and Human Resources Committee. They did so by researching salaries for minimum-wage staff in similar industries, such as hospitality and retail including potential competitors, such as Target and McDonalds, as well as competitors within the healthcare industry directly, acute and post–acute providers, and in-state database resources. With this information, Willis and others decided that their aspirational goal would be to offer minimum starting wages that were market competitive to the “Fight for $15” movement. The plan was presented to the Board, and it was approved with the stipulation that the program be reviewed annually to ensure it was fiscally responsible.

 

Implementation Details:

  • Planning Stage:
  • Research salaries in competitive industries, e.g., at Target and McDonalds, and look at your state’s database of average wage information for various positions, e.g., National Church Residences looked at the average wage for home health aides and front desk employees at hotels.
  • Compare your organization’s current minimum wage to those sources to get a sense of the market, e.g., the typical starting wage in Ohio was approximately $11.
  • Determine a new minimum wage fr the first year, e.g., National Church Residences decided on $10/hour.
  • Decide on an aspirational, multi-year wage goal, e.g., the National Church Residences’ goal was $14.50/hour at the end of five years. National Church Residences decided on this figure by looking at federal poverty levels and learning that working 30 hours per week was considered full-time.
  • Review current employee salaries and determine the percentage increase required over five years to bring them to the aspirational goal, e.g., if an employee was receiving $13/hour, National Church Residences provided a merit increase along with a 1% living wage adjustment.
  • Year 1:
  • All staff making less than $10 an hour had their wages increased to that amount effective 1/1/2016.
  • Staff making less than $14.50 per hour received an additional living wage adjustment at the time of their annual review and merit increase to achieve $14.50 per hour in five years.
  • Year 2:
  • The new minimum wage was established at $10.80 per hour. Again, all staff making less than $10.80 an hour had their wages increased to that amount effective 1/1/2017.
  • Staff making less than $14.50 per hour received an additional living wage adjustment at the time of their annual review and merit increase to achieve $14.50 per hour in five years.
  • Year 3:
  • The new minimum wage was established at $11.66 per hour. All staff making less than $11.66 an hour had their wages increased to that amount effective 1/1/2018.
  • Staff making less than $14.50 per hour received an additional living wage adjustment at the time of their annual review and merit increase to achieve $14.50 per hour in five years.
  • Year 4:
  • The new minimum wage was established at $13 per hour. All staff making less than $13 an hour had their wages increased to that amount effective 1/1/2019.
  • As part of the annual review to ensure fiscal responsibility and in light of the progress made to date, an additional living wage adjustment was not implemented during year four.
  • Year 5
  • The new minimum wage was established at $13.50 per hour. All staff making less than $13.50 an hour had their wages increased to that amount effective 1/1/2020.
  • As part of the annual review to ensure fiscal responsibility and in light of the progress made to date, an additional living wage adjustment was not implemented during year five.

Willis notes that an annual review to ensure appropriate stewardship of resources has added a couple of years to the original 5-year plan, but that National Church Residences is still focused on proving a living wage to all staff. Additionally, a re-evaluation of the living wage target has resulted in an increase to the aspirational goal to a minimum of $15 per hour.

Factors for Success:

  • Strong and visible support by the President of the organization.
  • An internal champion to keep pushing this effort at the respective service lines.

Outcomes: Last 3 Years

  • Reduced turnover among staff receiving the living wage.
  • Ended almost all use of contingent staff for housing service line front desk staff
  • Improved perception of the fairness of pay as reflected in the employee engagement survey.

Need more information?

Contact Danielle Willis at 614-273-3568.