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The accreditation was announced by Mayor Dave Cull in the city today alongside more than 150 other employers nationally.

This means council staff and contractors will be paid a wage considered by New Zealand Family Centre Social Policy Unit to be the "the hourly wage a worker needs to pay for the necessities of life and participate as an active citizen in the community".

The wage is $21.15, which accredited organisations had until yesterday to comply with.

Dave Cull speaks at the announcement of the DCC living wage this afternoon. Photo: Gerard O'Brien

It is the second council in the country to become an accredited living wage employer, after the Wellington City Council did so last year.

Living Wage Movement Aotearoa New Zealand accreditation co-ordinator Felicia Scherrer said the impact of the Dunedin council's decision to pay the wage was "significant''.

"More than 1000 workers will have their lives improved through the living wage, as well as all indirectly employed workers delivering a service to the council. As an accredited living wage employer, the council is role modelling what best business practice looks like.''

The number of living wage employers continued to grow as more businesses adopted it as a benchmark of paying an "ethical and fair'' wage, she said.

"The commitment to paying the living wage has, for some time, been led by small to medium sized businesses, who felt strongly that this was the right thing to do. Through their leadership and the success of these businesses, we now have larger organisations and corporations, also committing to paying the living wage. "

Also included on the list this year are AMP Capital Investors (NZ) Limited, AdviceFirst Limited and Auckland's Western Springs College, which is the country's first accredited living wage secondary school.