What Exactly Is A “Fair Wage”?

What Exactly Is A “Fair Wage”?

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The packages of Traidcraft coffee I’ve bought in the past always carry the written promise that coffee producers in developing countries are paid “a fair price for their work.” I’m all for healthy, sustainable business practices. But the Traidcraft label does raise the obvious follow-up question: What exactly is a “fair” price to pay a worker?

We would all agree to obvious points about the treatment of workers: that employers should fulfill contractual promises to their workers, that they should provide safe working conditions, and so forth. But the idea of a “fair” wage seems much more nebulous. What kind of wages would satisfy requirements of fairness, or perhaps justice, or perhaps Christian duty?

As best I can tell, Christian theology points to two considerations in trying to settle such questions. First, the Christian tradition has pointed, particularly in the last 125 years, to the importance of all workers receiving a “living wage.” The papal encyclical Rerum Novarum in 1891 first outlined the conditions of a living wage, and Catholic social teaching has since reaffirmed these conditions.

In short, a living wage is described as the minimum wage needed for an upright and thrifty worker to support oneself and one’s family. A sufficient wage not only provides for current necessities (which are understood to include access to healthcare and a reasonable amount of leisure time to spend with one’s family), but is also adequate for families to endure short-term unemployment and to plan for the needs of old age.

Importantly (and controversially), these basic needs are understood to trump the quests of others for profits. Rerum Novarum explicitly warns, as against “divine law,” the attempt to “gather one’s profit out of the need of another.” Basic human needs must first be considered in an acceptable business model, and then questions of profit can be considered.

Pope John XXIII reaffirmed this social teaching in the clearest terms: “The remuneration of work is not something that can be left to the laws of the marketplace; nor should it be a decision left to the will of the more powerful. It must be determined in accordance with justice and equity; which means that workers must be paid a wage which allows them to live a truly human life and to fulfill their family obligations in a worthy manner.”

Protestant churches have made similar declarations. The 1908 Social Creed of the Methodist Episcopal Church affirmed its support for “a living wage in every industry.” To cite just one further example, the Federal Council of Churches of Christ in America announced in 1919 that “the living wage should be the first charge upon industry, before dividends are considered.”

Today the United Methodist Church continues to reaffirm, in its Book of Resolutions, its “historic support for the living wage movement and calls upon businesses and governments to adopt policies to ensure employees are paid sufficient wages to afford shelter, food, clothing, health care and other basic expenses, according to local costs of living.”

There are websites that calculate what a minimum living wage is, within different regions of the United States. I’ve heard people quibble about the particulars of these calculations. But as a starting point, I think it would be great step if local churches had discussions about a living wage.

A second consideration in discussing Christian duties about wages has to be this: the dignified participation in local community. A central Christian theme is that our relationships are to be loving and interdependent, mirroring the relationships within the Trinity. If the financial resources available to one family make it awkward or impossible for other families to depend on that family, then the goal of an interdependent community is undermined.

So I think a Christian theology of the family—as well as a theology of families in community—serves as a good basis for thinking about wages. Perhaps the notion of a “fair” wage is hopelessly ambiguous. But Christians do have theological resources in thinking about what our stances should be on such issues as a national minimum wage, the wage scale with our own place of business, and so forth.  (If your view is that a different set of theological considerations should inform a Christian view on wages, then you have a standing invitation to write a post for this blog!)

I have often heard Christians advocate for “family values.” I agree. The family unit is such an important biblical theme. But when I hear about family values, it’s usually in the context of issues like television content, with Christians having deep concerns about the violence and sexual content on display.

I happen to agree with these concerns. And if our local churches want to have a discussion about how to express these concerns to television producers and politicians, sign me up. But shouldn’t any Christian discussion about family values also have a focus on such issues as a living wage?  Much official social teaching of the Church has focused on it. I hope we’re having theological discussions about it in our local churches as well.


2 Responses

  1. Thanks, Kevin, for this helpful article to provide some theological background to setting a fair wage. This is a very concrete way to express our faith in the marketplace. Do you have any practical advice concerning approaches to take concerning the wages to establish for employees? As you mention in the article, this widely varies based on geographical location, nature of the work, skill level of the employee, amount of direction needed, etc. I have often relied upon the minimum wage as a floor that I should raise above significantly since I do not want employees doing a minimum job – I would rather pay them more than minimum wage and raise the expectations that they are working hard, thinking ahead, etc. such that they are going above and beyond the minimum. This is a challenging area since it directly cuts into the employer’s profit but it also causes the employer to think ethically in a very concrete way when EACH paycheck is issued.

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