On Monday 18 April I took part in a debate on a motion relating to the Introduction of the National Living Wage and related changes to employee contracts. This debate was scheduled by the Backbench Business Committee following a bid from Labour MP Siobhain Mcdonagh.
In February 2016 the Government announced that the minimum wage would be increased to a new ‘national living wage’. However, some employers are cutting overall remuneration packages to offset the cost of its introduction, leaving thousands of low-paid employees significantly worse off. This has been documented in the media with Café Nero announcing it will no longer provide its staff with a free lunch while on shift following the introduction of the new National Living Wage. Similarly B&Q have attempted to make these changes to its staff’s contracts:
- removal of time and a half pay for working Sundays,
- restructuring of allowances for working in high cost of living areas of the UK
- removal of double time for working bank holidays (now proposed to be 1.5)
- Removal of a summer and winter bonus equating to 6% of annual salary
All of these changes completely undermine the point of introducing the ‘’living wage’’ by this Government and lead to hardworking people being significantly financially worse off.
The sad reality is that many employers see the national living wage or minimum wage as a ceiling for payments, rather than a floor, and will always try to pay the least that they can get away with.
In the debate, I spoke up for small businesses and the impact of the national living wage for the local area, as we know that if the lowest paid workers have a pay increase, they tend to spend it locally, so the local economy grows.
Similarly I spoke about the National Living Wage not including Seafarers. These are the only group of workers who are excluded from the full protection of the national minimum wage legislation and equal pay legislation. Presently, passengers and businesses are travelling on vessels crewed by seafarers who are earning as little as £2.40 an hour. This legalised exploitation has systematically undermined maritime jobs in the UK, damaging the skills base and driving up unemployment rates in seafarer communities across the UK.
In its March 2016 report to the Government, the Low Pay Commission recommended that a stronger third-party complaints system be introduced for employers breaching the national minimum wage. That is through the creation of a public protocol to govern HMRC’s investigation of third-party complaints.
I urge Ministers to accept that recommendation. A strengthened third-party complaints procedure currently represents the most effective way to tackle pay rates in the shipping industry that fall below the national minimum wage because of the understandable reluctance of the affected seafarers to complain directly to the UK Government.
You can watch my interventions and speech below
You can sign the petition against B&Q here: https://www.change.org/p/don-t-use-living-wage-as-excuse-to-cut-pay-benefits