We’re an accredited living wage employer
In 2021, we were awarded our first global independent accreditation as a living wage employer from the Fair Wage Network.
A living wage
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Workers deserve a living wage – and fair pay brings benefits for families, communities and our business. We want to raise living standards by ensuring everyone who directly provides goods and services to Unilever earns a living wage or income.
Fairer pay for a fairer world
Building on our commitment to pay a living wage in our own business, in 2021 we set a groundbreaking new goal that’s part of our Unilever Compass.
We know that economic growth is only inclusive and sustainable when workers receive fair wages. And that our business flourishes when those around us are doing well. Making sure that workers earn a living wage helps support economies and fosters growth. And it’s simply the right thing to do for a business that is founded on respect for human rights. So we’re advocating living wages through many platforms and building alliances to create momentum for the change we want to see.
Our living wage commitment for employees
We created our Framework for Fair Compensation (PDF 192 KB) in 2014. Through the first of its five principles we committed to pay all our employees a living wage, which we’ve achieved since 2020. We’ve updated our Code of Business Principles to endorse this commitment.
Every year, our country leaders confirm that they have complied with our Code. And we require each country business to report its status against the standards of our Framework.
We check we're paying our employees a living wage by auditing compliance against our Framework each year. Our audits check that:
- fixed compensation is achievable without the need to work an excessive number of hours
- our country payroll processes deliver employees’ full pay correctly and on time, every time
- we have no issues of unequal pay between genders.
We’ve worked closely with the Fair Wage Network (FWN) and others to develop our understanding of living wages. FWN provided an objective external source of the living wage amount for each of the countries where we have employees.
We used these thresholds to assess whether the fixed compensation paid to all our full-time direct employees (including factory and non-factory employees) in each country met our living wage standard – which means employees receive, at the very minimum, fixed and guaranteed levels of earnings that are above their country’s or location’s living wage benchmark. In some countries, such as those under the Gulf Cooperation Council, there are no legal minimum wages mandated by the government – which meant we needed to identify a substitute for the legal minimum wage as an initial wage floor or starting level.
Extending our approach
Fair wages have always been a principle of our Responsible Sourcing Policy (RSP) (PDF 8.25 MB) and Responsible Business Partner Policy, which include the Mandatory Requirements our partners must be able to meet to do business with us. In 2022 we replaced these two policies with our Responsible Partner Policy (PDF 4.45 MB) (RPP), and in line with our commitment for our own employees, it includes the Future Mandatory Requirement for suppliers to pay a living wage to their workers. We’ll phase in this requirement across our different procurement categories in order to deliver our commitment by 2030. See Human rights in our value chain and Becoming a Unilever supplier for more detail.
In 2020 we added the principle of a living wage to our Code of Business Principles: “We will work with our business partners to raise standards so that their employees are paid a living wage and are not subject to forced, compulsory, trafficked or child labour.” We also have a specific internal policy for temporary workers in manufacturing who are provided by third parties.
To make our living wage goal a reality, we’ve put an action plan in place that builds on the progress made by looking at where the gaps between actual and living incomes are greatest, where the social safety net for workers is weakest, and where we can make the most impact, based on our presence and scale in local markets. Using these criteria, we’ve identified six priority markets – Brazil, China, India, Indonesia, Philippines and Vietnam – and are creating implementation plans at country and purchase category level.
We’re focusing on the most vulnerable workers in manufacturing and agriculture, and we’ll work with our suppliers, other businesses, governments and NGOs – through our purchasing practices, collaboration and advocacy – to create systemic change and champion the global adoption of living wage practices.
We’re prioritising our collaborative (third-party) manufacturing sites to close the living wage gap in workers’ wages. For our agricultural supply chain, we’re focusing on five key crops that are important to our business – tea, palm, vanilla, cocoa and vegetables. After assessing living income gaps for the smallholder farmers of these crops, we’ll develop tailored implementation plans.
Partners with purpose
Through our Partner with Purpose programme for suppliers, we’re finding innovative and impactful ways to deliver on our ambitious commitments and generate mutual growth.
Advocacy for change
Advocacy and collaboration play key roles in our efforts to raise living standards through living wages and incomes, because all stakeholders – companies, governments, investors, NGOs and trade unions – must be involved in mainstreaming living wages.
We’re advocating living wages through existing multi-stakeholder platforms, forming new public–private alliances at a country level and engaging in dialogue with governments.
We aim to mobilise like-minded companies to close the gap between minimum and living wages and incomes in their operations, influence governments to institute and implement living wage and income policies, and to build cross-sector coalitions to drive systems change on living wages/incomes.
We’re encouraged to see the progress being made through public statements of support for living wages, such as those made by the United Nations Global Compact, Business for Inclusive Growth, IDH and AIM-Progress. However, we need to see accelerated action from all stakeholders.
To further advance the movement, in 2022 we facilitated the publication of The Case for Living Wages, a research paper that analyses how paying living wages improves business performance and tackles poverty.
We’re seeing growing momentum on living wages, including from our investors. For example, the Platform for Living Wage Financials is an alliance of 19 financial institutions managing over €6.5 trillion of assets, which encourages and monitors companies' efforts to address living wages and incomes in their global supply chains. We’ve been recognised for our efforts and ranked highest for the maturity of our programmes in the Platform’s food and agriculture ranking.
Similarly, we’re seeing a more aligned approach from expert organisations working on living wage methodologies and data, which is an essential step in progressing this complex agenda. For example, we are supporting the creation of a publicly accessible, global database of living wages as we believe that making living wage data available free of charge to all supports and facilitates widespread living wage implementation.
Our Human Rights Progress Report 2021 (PDF 2.81 MB)
Our latest Report gives more detail on how we’ve started to implement our living wage and living income commitment and how we’re mobilising partners to drive change. Our Human Rights Report 2020 also details our work and partnerships.