Ball Horticultural’s Global Initiative: Ensuring Living Wage for 8,000+ Workers Worldwide

Ball Horticultural’s Global Initiative: Ensuring Living Wage for 8,000+ Workers Worldwide

“Getting consistent data was a bit of a challenge because different countries had their own sets of data that weren't always easy to compare. But then, we stumbled upon the Wageindicator Foundation, and it was a game-changer! The standardised criteria made sure everyone was on the same page, dealing with fairness issues and giving us reliable data. Wageindicator totally streamlined things and brought some much-needed order to the process,” says Susannah Ball, fourth generation leader of Ball Horticultural. 

The Wageindicator Foundation recently sat down for a conversation with Susannah Ball, Sustainability Co-lead, and Bill Doeckell, ESG expert and Global Sustainability Lead at Ball Horticultural, a global leader in horticulture. They develop, produce, and sell plants worldwide, collaborating with over 8,000+ workers in more than 30 regions globally. We delved into the motivations behind their decision to embrace the living wage, explored the positive impact they have achieved, and gained valuable insights for businesses considering a similar path.

What inspired your exploration of the living wage concept and subsequent decision to implement it?

Susannah: As a family company, we value how we treat our employees, and setting a meaningful goal in the social space was a priority. However, determining a universal goal was challenging due to the diversity of our locations and the varying needs of our employees, ranging from Phd scientists to field labourers. The concept of a living wage emerged as a solution.

Bill: The concept of a living wage was something we were both familiar with. It stood out as the one aspect that could apply universally across all our locations, serving as a meaningful social goal. While we had individuals striving for success at each location, we were uncertain about whether they were leading decent lives or receiving a living wage, despite minimum wage and other benefits. 

Susannah: Absolutely crucial! We realised that just sticking to the minimum wage in each country wasn't cutting it. Trying to tackle things like lunch or other perks faced challenges because of the diverse preferences and needs across our locations. So, we've embraced the living wage concept—it's now our go-to standard that keeps things fair and clear across the board.

When did you start considering a living wage for employees/workers?

Bill: By early 2021, we set the goal, even before connecting with the Wageindicator Foundation. It felt right for us, aligning with our aspirations, though we didn't have all the details then. As Susannah and I delved into it, we realised ensuring a living wage, even if it meant paying more, could greatly contribute to the communities where we work. We've always been committed to giving back, and paying people well to invest in themselves and their communities felt like a powerful way to make a positive impact. It resonated with us, and we knew it was the right direction.

What was a significant challenge identified in implementing a living wage, and how did Wageindicator aid you in overcoming that obstacle?

Susannah: Getting consistent data was a bit of a challenge because different countries had their own sets of data that weren't always easy to compare. But then, we stumbled upon the Wageindicator Foundation, and it was a game-changer! The standardised criteria made sure everyone was on the same page, dealing with fairness issues and giving us reliable data. Wageindicator totally streamlined things and brought some much-needed order to the process.

How far have you come in making living wages a reality?

Bill: We've hit the ground running with the implementation stage. About a year ago, we surveyed approximately 30 locations, and identified gaps (the difference between the wage paid and the living wage) in nine locations, but the good news is we've already closed two. Last summer, we tasked all managers from different locations to craft a plan for implementing the living wage. This plan covers costs, strategies, and the whole deal. They're gearing up to present their plans in our upcoming meetings, probably by the end of February. Currently, we're smoothly cruising through phase two of this initiative. There's no set end date because, you know, some spots might wrap things up in two years, while others might take five years, depending on the size of the gap.

How many workers do you engage with on an average throughout the year?

Susannah: About 8,000+ workers, fluctuating a lot from season to season because we're a super seasonal business. 

What is your strategy for closing the gap—moving from big to small or from small to big?

Bill:. Our gaps were generally around 15- 20% or less. According to Wageindicator Insights, if it's within the 20% threshold, we can likely address it internally. We're also collaborating with IDH for additional support. Larger gaps may require assistance from the supply and value chain. Despite the potential challenges, being at the beginning of the supply chain, we believe we can gradually rectify these issues over time. While it might take some time, we've initiated the process by asking all regions with a gap to develop their own plans. 

How do you navigate living wage for full-time employees, part-time seasonal employees, contractors, maybe even subcontractors, considering that there are different types of workers working for you. How do you navigate that?

Susannah: Wageindicator played a significant role in assisting us. With their help, we were able to calculate the living wage per hour, ensuring that individuals were compensated based on the hours they worked.

How did your supply chain managers react to these initiatives? Were they excited, or did they have reservations?

Susannah: Some managers were fully supportive, saying, "Yes, we need to do this." Others questioned the need, arguing they already paid the minimum wage. Having official data from a third party helped. We could say, "Look, here's the data, including extra details on categories like food, housing, water." The data was helpful, especially for the sceptical minority. 

What are the implications of correcting the gap in wages at the organisational level?

Susannah: A challenge that might not be immediately obvious arises when managing a group of 100 individuals, all earning at least 10% below the living wage. Although a mere 10% raise for each employee may seem insignificant at first glance, the complexity increases when taking into account the pay range for different roles. An adoption of the living wage may lead to workers earning salaries on par with their supervisors, prompting the need for raises among supervisory staff. While the arithmetic may seem simple initially, a closer look at the various wage gaps reveals that the total amount required can quickly escalate.

Bill: Our HR manager, during our initial meeting, mentioned that you'll need to examine one or two levels above workers we are targeting for wage increases. We encountered this when the minimum wage increased in California; we had to adjust two levels. It's essential to communicate that at least two levels will be affected—low-level supervisors, as Susannah mentioned, and, depending on your organisational structure, possibly three levels, incurring a more substantial cost. If we set a three-year gap-closing target, it's essentially a mathematical exercise. You crunch the numbers and say, 'This is what it's going to cost.' However, we are looking at it more holistically, the living wage becomes a tool for becoming an employer of choice, a better community citizen, and attracting and retaining talent. We're already observing this in Thailand, where we implemented it, and now people actively seek employment with us. It's changing the dynamic. 

How has this entire process of implementing living wages affected your business revenue model?

Susannah: Implementing living wages does increase costs, and its impact on our revenue model requires monitoring. I hope it prompts a reevaluation of processes. In low-wage areas, assigning numerous people to physical tasks may be less efficient. Addressing the root cause may involve developing streamlined processes instead of relying on labour quantity. This challenge arises in countries with inexpensive labour, leading to a default solution of adding more workers. Despite providing good jobs, we must reconsider this approach in some locations.

Did the implementation of the living wage in 2021, during the height of the pandemic, have any impact?

Bill: The Covid and post-Covid times are both inflationary periods. Handling significant swings in inflation and repatriating local currency became challenging.

Susannah: However, on the flip side, we also found support. Many countries increased their minimum wage, such as Mexico, which recently implemented a 20% increase. This not only validated our approach but also brought the discussion on fair wages to the forefront, which made it easier for us to have these conversations with our supply chain managers. 

Bill: Another challenge we face involves local communities, associations, and competitors. If we deviate too much from the norm, they might not be happy. Managing local perceptions and communicating why we're making these changes is crucial. Some of our managers are excellent at this, emphasising why we're implementing living wages and how it aligns with our values.

What can the end users of your services expect in the coming years in light of these changes you're currently working on? Is there a message for the final end users or your customers?

Susannah: From a practical standpoint, even in the challenging and complex entry-level positions, having employees stay longer (due to improved wages) reduces the necessity for retraining, leading to higher-quality products for the customer. Retaining employees for an extended duration benefits all parties involved, most especially our end users. My hope is that implementing a living wage benefits everyone in the chain, from harvesters to the end consumer. 

Bill: It's a familiar narrative – treat people right, and they reciprocate by treating the business right. The distinction now is that we possess data supporting our direction and objectives for a living wage, a resource that was previously unavailable.

February, 2024