Hastings Borough Council proposes 'living wage'
Hastings Borough Council wants to pay all its employees a living wage to encourage other big employers in the area to do the same.
Their plans would see sub-contractors paid at least £7.45 an hour. The minimum wage is £6.31 an hour for people aged 21 and over.
Staff directly employed by the council already get the higher rate.
Hastings Area Chamber of Commerce said to introduce a living wage beyond the council would be "quite dangerous".
Hastings leader Jeremy Birch hopes to get accreditation by next April.
The council said the ideal next step would be to use it as a springboard to becoming a living wage town, where everyone gets a minimum of £7.45 an hour.
Mr Birch said: "If people in Hastings are better paid, people in Hastings will spend more money in Hastings businesses and shops. Hastings businesses and Hastings shops will then be able to employ more people so it will be a virtuous circle.
"I don't want Hastings to be known as a low wage economy. I want it to be known as a prosperous economy where people are paid better and spend more."
Clive Galbraith, chairman of the Hastings Area Chamber of Commerce, said: "In an area that's amongst the most deprived in the South East and with hundreds of small businesses just coming out of recession the last thing they need is increased overheads and further squeezed margins.
"To expect private employers to find this extra money will be a lot locally really.
"Don't mishear what I'm saying, I don't want Hastings to be a low-wage economy either I want a well-educated and well-paid town but to roll out something like this beyond the council and say the town is going to be living wage town. How are you going to police that?"
The living wage is calculated annually by the Living Wage Foundation according to the basic cost of living in the UK.
Campaigners have been trying to persuade employers to pay the hourly rate since 2005, when it was first adopted by the Great London Authority.
Brighton and Hove and Gravesham councils have both introduced the living wage.