Tools

Guidelines for verification

IDH has developed guidelines for verifying living wage gaps preferably through third-party auditing and the corresponding base report, which serves as the physical evidence for third-party verification of living wage gaps. Guidelines have also been developed for first- and second-party auditors. These guidelines have been developed to support schemes and auditing bodies interested in verifying living wage gaps.

View the Guidelines for Third-party auditors (Spanish)

View the Guidelines for First and Second-party auditors(Spanish)

View the Base Report (Spanish)

Auditor Training

IDH established a partnership with the ImpactBuying Academy to provide training for trainers of auditors and directly to auditors that want to assist companies in the verification of living wage gaps. The training is based on the guidelines for verifying living wage gaps and the proper use of the Salary Matrix to support living wage auditing.

Read about the training

Keep reading about Step 3

  • 3.1 Why is auditing is important?
    More info
  • 3.2 What if the results of the Salary Matrix are not verified?
    More info
  • 3.3 How can auditors access training on the guidelines for verifying living wage gaps?
    More info
  • 3.4 Which certification schemes and auditing organizations does IDH recommend?
    More info

3.1 Why is auditing important?

Salary Matrices have traditionally served as a self-assessment exercise. Ultimately, the desired scenario is that the utilization of the tool and the calculations of remuneration and how it compares to a living wage benchmark can be verified through audits by certification schemes that have living wage requirements in their standards. Currently, several programs are strengthening their certification standards and auditing procedures to include living wage related requirements. To support that process, IDH developed recommended guidelines for verifying living wage gaps through the appropriate use of the Salary Matrix. In future years, it is expected that verification can be performed by auditing schemes that adhere to these guidelines.

Living wage projects, led by diverse groups of partners and stakeholders, are taking place all over the world. As focus on this important topic has continued to grow, so too has the need for uniformity around how living wage gaps are calculated. Consistent and aligned living wage gap analysis is crucial to the effectiveness and credibility of strategies to close gaps and achieve decent standards of living for workers.

For buyers or traders that have supply chain partners all around the globe, alignment around both the living wage concept and how living wage gaps are measured is fundamental to building trust and the capacity to scale up. For producers and manufacturers that are asked to calculate the living wage gap at their production level, uniformity will ensure clarity and reduce inefficiencies.

To support this need, IDH has developed guidelines for verifying living wage gaps through auditing (for first and second-party auditors as well as third-party) and the corresponding base report, which serves as the physical evidence for third-party verification of living wage gaps. These guidelines have been developed to support third-party schemes and their auditors interested in verifying living wage gaps.

For companies interested in independent verification, IDH recommends working with fully trained auditing schemes that can help verify calculations on remuneration and living wage gaps through the appropriate use of the Salary Matrix and that have adhered to the use of these guidelines.

Read the Guidelines


3.2 What if the results of the Salary Matrix are not verified?

It is important to note that the living wage gap analysis is currently solely a self-assessment. While occasional data entry validation was completed, this, in no way replicates third-party, in-person audits. Field auditing, and most importantly interviews with employees and worker representatives, is critical for proper verification of wages, bonuses, and the value of in-kind benefits. Such conversations are essential to proper verification, as well as risk management. Without thorough verification, one cannot determine if any workers have been excluded noted and worker organizations have been consulted.

A key element of the Salary Matrix is the annual production volume. This volume is, essentially, the volume which the workers in the Salary Matrix have produced. If the volume is incorrect and does not correctly represent the volume produced by those included in the Salary Matrix, this greatly affects the overall calculation of the gap as some workers can be excluded.


3.3 How can auditors access training on the guidelines for verifying living wage gaps?

Launching a robust training program for 1st, 2nd or 3rd party auditors is part of that Roadmap on Living Wages. It will enable auditors to verify living wage gaps and deliver a uniform report with their findings.

IDH established a partnership with the ImpactBuying Academy to provide training for trainers of auditors and directly to auditors that want to assist companies in the verification of living wage gaps. The training is based on the guidelines for verifying living wage gaps and the proper use of the Salary Matrix to support living wage auditing. With the ImpactBuying Academy taking on the auditor training for verifying living wage gaps, we take the next step in supporting companies in their living wage journeys.

Interest in the training? www.impactbuying.com/academy 


3.4 Which certifications schemes and auditing organizations does IDH recommend?

To build alignment and uniformity, IDH recommends certification schemes and auditing bodies that have adhered to the utilization of the guidelines for verifying living wage gaps and the Salary Matrix (or compatible tools) to support auditing activities and whose auditors have received the necessary training. Recommended schemes and auditing organization also adhere to IDH’s monitoring program for the verification of living wage gaps.

Coming soon: the list of recommended certification schemes and auditing bodies that have embraced the implementation of IDH’s guidelines for verifying living wage gaps.

Follow the Roadmap

  • Step 1: Identify the Living Wage
    More info
  • Step 2: Measure the Living Wage Gap
    More info
  • Step 3: Verify calculations of Living Wage Gaps
  • Step 4: Close the Gap
    More info
  • Step 5: Share learnings
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