The Lord Mayor of Dublin has unveiled a new plan to encourage firms to pay the living wage.

The legal minimum wage is €9.25 per hour, but the optional living wage of €11.50 is designed to help workers maintain what Dr Nat O'Connor of the Living Wage Technical Group calls a "frugal standard of living".

Brendan Carr announced on Thursday that Dublin companies who pay the living wage will be entitled to display a plaque at the entrance to their premises under the new scheme.

A committee appointed by Dublin City Council will consider applications for inclusion in the Dublin Living Wage Initiative.

Carr said upon launching the initiative:

"The growing crisis of low pay for workers in Dublin must be faced up to. In this city there are residents in full time employment whose overall earnings are so insufficient that their families have to avail of emergency accommodation.

"This is a situation which is putting a severe strain on families, the State and local authority services."

He added:

"I have made clear for sometime my commitment to this initiative and have been dismayed by the response of some business representative organisations.

"An employee receiving a living wage is something that should be welcomed by the business community as it provides people with a minimum socially acceptable standard of living, which allows them to play an active role within the local economy."