Sam Keam, co-founder of urban logistics firm Zedify, reflects on the impact that paying a real Living Wage has had on his business.
The logistics industry has become notorious for the poor employment practices that have become increasingly commonplace. Many of the biggest names in our sector see the fair treatment of their workers in opposition to the interests of the business. At Zedify, we are demonstrating that this isn't true. We've found that when you treat people with respect, they repay you in kind. As employers, we have a choice: to build our business models around the premise that the worker comes last; or to focus our efforts around supporting good, sustainable, ethical employment. That choice should be simple. Our employees - just like workers everywhere - are people with bills to pay, rent to make and lives to live. People who need a real Living Wage, especially during these uncertain times.
Zedify was founded in 2018 on the belief that the logistics sector needed a fresh start. It's a hard sector to make a profit in but paying the Living Wage (an independently calculated rate based on the cost of living, set at £9.50 across the UK and £10.85 in London) was something we were never prepared to compromise on. We operate in cities - places where there's a very high cost of living - and most of our delivery staff are relatively young. The Living Wage Foundation has forecast that workers living in London and earning the National Living Wage (the government's minimum for anyone over the age of 23) instead of the real Living Wage will miss out on £3,800 in the next year. Just think how many weekly food shops that would pay for.
Operating in a sector where the standard business model relies on having lots of people waiting for commission-based work to come along through an app, our practice at Zedify of employing people directly and paying them a Living Wage by the hour makes us unusual. Sometimes, we encounter companies who are so used to working with subcontractors who operate in the conventional way that they worry we'll be really expensive and we won't have high productivity because our staff effectively get paid more to deliver slower. But that's not how it pans out at all: we've found that paying the Living Wage to our staff makes our business stronger and more competitive.
Staff are more motivated
Because we pay them a real Living Wage, our employees feel valued. As a result, we find our staff are incredibly motivated, dedicated to achieving the best for the business. We pay more, we expect more in return, and our staff want to give more in return. That fact is borne out by how rarely we need to intervene or question whether a courier is giving 100%. It's very unusual that we need to pull someone aside. It surprises some of our clients when such assumptions are normally refuted by our performance data: it shows that paying the Living Wage pays off.
Staff stick around
Our retention rates are well above the industry standard - we have riders that have been with us for nearly 10 years. Why? We invest in our staff. On top of paying a real Living Wage, we make sure our couriers are really highly trained. We don't just give them an app and tell them to follow the instructions on the app. We invest 3-6 months of training in our employees; if we had to constantly hire and train new people we would never achieve the levels of productivity that we need as a strategic business. When people leave us, most do so because they're moving out of the city, or they want to pursue a passion elsewhere.
Other people want to work with us
Paying the Living Wage is a really big competitive advantage for us in a number of areas. People want to work with us because they know we treat our staff with respect. A great example is when we're filling in applications for tendered local authority contracts - being an accredited Living Wage Employer is a major draw for the public sector. Whether it's for local authorities or for the NHS, in many cases we've won contracts because they've required a Living Wage Employer.
Paying the Living Wage has been good for Zedify's business. But, as it turns out, our commitment to paying the Living Wage has been good for another business too. Josh, one of our riders, runs a screen-printing business in his own time. He's told me that being paid a real Living Wage has given him the freedom to take fewer hours with us, and put more hours into getting his own business off the ground. That's a whole business that would struggle to exist without the real Living Wage.
At it's core, the Living Wage Movement (now made up of over 7,000 employers voluntarily paying their staff more than the minimum rates set by the government) is about respecting people. It's about making sure that the contract - not the literal, written contract, but the agreement - between employer and employee is one of mutual respect, honesty and decency. Paying the real Living Wage is a choice: that every responsible employer should take.