Living wage campaigners have convinced Wellington City Council to pay more for their security staff, but the move could land the council in court.

The threat of court action over Wellington City Council's decision to pay more staff a living wage appears very real, as business owners weigh up their options.

Wellington Chamber of Commerce chief executive John Milford said all options would be considered after the council's decided to pay $1.7 million more than the going rate for security services over the next seven years so those staff could take home a living wage.

Councillors voted 9-6 on Wednesday to do so despite warnings from chief executive Kevin Lavery that it could be illegal, as the Local Government Act prohibits councils from paying more than necessary for services without any corresponding benefit.

The living wage is considered to be what a worker needs to pay for the necessities of life, and participate as an active citizen in the community. The council's interpretation is $18.55 per hour.

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The ongoing impact on ratepayers remains to be seen, but councillors also voted eight to seven to cut personnel and staff travel costs by $250,000 a year for seven years to help balance the books.

Milford said the chamber request council provide it with all relevant material on the decision, including its legal advice before deciding its position over the coming days.

Milford did not mention the words "judicial review" but councillors were warned on Wednesday that being taken to the High Court over the living wage was a real risk, and that the council's lawyers felt they might lose.

Te council's living wage policy would lead to "perverse, illogical and unfair outcomes," given the security contract was a shared-services contract with Porirua City Council and Kapiti Coast District Council, Milford said.

"The outcome here is that the security company will be instructed by Wellington [City] Council to pay different wage rates for the different locations, to their same staff, for the same job," he said.

"Ignoring your own officials' advice and forcing third-party contractors to pay a certain level of wage or face losing the council's business is most concerning. That not only puts Wellington jobs and businesses at risk, it goes well beyond the council's authority."

Wellington Mayor Celia Wade-Brown said the council would see plenty of benefit for the extra money it was spending on security staff wages.

"We expect improvements to the quality and effectiveness of these services and greater pride in delivery."