A Living Wage at Michelin

Guadalupe Maria

Product #:IN-2196

Supplier:INSEAD

Discipline:Organizational Behaviour/Leadership

Details:Case (PDF) • 6 pages • 2025-05-21

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In 2024, Michelin adopted a living wage for all employees worldwide, paying what was deemed necessary to live decently, taking into account their family configuration and where they worked. This case describes how the company went about it as the basis for a discussion on the costs and benefits of raising wages for low paid workers, as well as the role of firms in reducing inequality. It compares the introduction of a living wage (by firms) with the imposition of a statutory minimum wage by the state.

Learning Objectives

- To understand the implications of adopting a living wage for all workers. - Evaluate the role of firms in reducing inequality, and how to design the policy so that both firms and workers benefit. - Contrast the effects of the introduction of a living wage by companies with the application of a government-mandated minimum wage.