CBI Scotland has urged the Scottish Parliament not to support a living wage recognition scheme, claiming that it would threaten jobs in Scotland.

The Parliament's Public Petitions Committee is considering a proposal from the Scottish Youth Parliament, pressing the Scottish Government to favour companies that pay employers a "Scottish living wage", currently calculated at £7.45 per hour. The rate is 20% higher than the current adult national minimum wage of £6.19 per hour.

CBI Scotland's senior policy executive Lauren Paterson said: "Pay restraint has played an important role in supporting current levels of employment. A Scottish Government living wage recognition scheme would encourage mass implementation of the wage, which would put employment prospects at risk, particularly for those furthest from the labour market. Pay restraint is set to continue with containing labour costs cited as the second-highest workforce priority for businesses in the next 12 months."

She stressed the CBI's support for the national minimum wage, "balancing" income for low earners with the need to preserve jobs: "Beyond this, decisions on pay must be left at the discretion of the individual business, taking into account their wider business strategy, including affordability."

In March, the Scottish Youth Parliament suggested a recognition scheme might involve employers signing a legally-binding declaration to pay staff and subcontractors the higher wage, with a commitment to uprate it within six months. Being a recognised "living wage employer" would, it is claimed, "provide an incentive for businesses to gain publicity for being a good and responsible employer, potentially allowing businesses to attract customers and become more attractive to people awarding work".

Calculated on the basis of working a 35-hour week, someone on a living wage would earn £13,559, against £11,265.80 per year on the national minimum wage.

In a submission to the committee, Dave Watson, Scottish organiser of Unison, said: "One of the primary causes of the longest and deepest recession for a generation has been the shift from wages into profits. The Scottish living wage recognition scheme would be a valuable step forward in putting spending power at the disposal of low-paid workers, who will spend that cash boosting their local economy.

"It's the fat-cat pay of the CBI bosses that is out of control."

The committee will consider the petition after the summer recess.