Starbucks is to start giving out loans to its UK employees to help them with rental deposits in a bid to ease the high costs of living. The Home Sweet Loan programme will allow Starbucks to give out an interest-free loan to employees moving into a new home, making the coffee chain the first private company in the UK to engage in such an initiative. The scheme was developed by Shelter, the housing and homelessness charity.
Starbucks also announced plans to extend the national living wage to all employees, including 4,500 staff members (50% of the company's UK staff) who are under the age of 25. This will see all Starbucks employees receiving an increase in pay from £6.77 to £7.20 per hour, starting in April 2016. It will also pay a London Premium to those working in the capital city.
"We know the cost of living is a concern for many, with the average rental deposit in England being £1,226," said Starbucks president Kris Engskov. "With over half of our [staff] being under 25 years old, that rent affordability especially is an issue that affects them. These initiatives are two of the ways we are able to support the great people we work with."
Shelter confirmed that there are now 11 million private renters in England as housing costs continue to rise. Its Tenancy Deposit Loan Scheme was launched in 2013 with its own staff and the charity said it had been a "success".
"It's great to see that Starbucks is following suit and helping their staff to move into a home without worrying about they'll cover the cost," said Campbell Robb, Shelter's chief executive. "This will no doubt encourage other UK employers to follow their example and give renters the helping hand they need."
Starbucks' initiatives were announced as Costa Coffee said it planned "price increases" in order to be able to pay employees the national living wage. Chancellor George Osborne's surprise announcement in July introduced a compulsory national living wage for workers over the age of 25, however, many companies are struggling to meet the new wage recommendations. On Friday (25 September) the managing director of John Lewis, Andy Street, said that the retailor was dealing with "big issues" to pay the increased national living wage.