National Minimum Wage: Care Sector

Angela Rayner Excerpts

Wednesday 23rd March 2016 Westminster Hall

[Paul Blomfield (Sheffield Central) (Lab)]

I beg to move,

That this House has considered Government policy on enforcement of the national minimum wage in the care sector.

I am delighted that you are in the Chair, Mr Rosindell, and that so many colleagues are here to speak about this issue.

I am pleased to have secured this debate, although I am disappointed that it is still needed, because we had a debate on this very issue, led by my right hon. Friend the Member for Oxford East (Mr Smith), back in November 2014, during which it was acknowledged that we had a real problem. That was acknowledged by all sides, including by the Minister at that time, the right hon. Member for North Norfolk (Norman Lamb), because in March that year the National Audit Office had estimated that up to 220,000 home care workers in England were being illegally paid below the national minimum wage. Eighteen months on, we still have the same problem.

We could talk forever about numbers, and I am sure that a number of colleagues will cite statistics, but I think the human stories explain what the issue is really about.

[Angela Rayner (Ashton-under-Lyne) (Lab)]

I worked in the sector as a home help and represented home care workers. Does my hon. Friend agree that the human stories are quite tragic? What home carers end up having to do is subsidise their employers, who do not pay them travel time. A good employer will see the value of their staff, and pay them correctly and appropriately.

[Paul Blomfield]

I thank my hon. Friend for that intervention and I completely agree with her. I will illustrate that point further in my comments today.

--- Later in debate ---

[Chris Stephens (Glasgow South West) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Rosindell. I refer Members to my entry in the Register of Members’ Financial Interests and declare my 20 years of trade union activity for the Glasgow city branch of Unison before my election to Parliament.

There are far too many instances of care home providers who provide services for a profit ignoring or disregarding their legal responsibilities to their staff. It is particularly insidious that those who are paid the least and provide some of the most vital services needed by our society, which we will need more and more as our demographics shift, are being denied even the most basic protections by their employers. In two recent cases, MiHomecare settled a national minimum wage pay claim with one employee for £1,250 and, as we heard from the hon. Member for Neath (Christina Rees), in south Wales Unison colleagues secured backdated wages for 100 workers amounting to up to £2,500 each after it failed to pay workers for time travelling between clients.

A leaked document from MiHomecare sets out exactly how much workers are being short-changed by. Its internal analysis in the wake of an HMRC investigation into its employment practices revealed that 44 workers could have been out of pocket by as much as £2,000 a year each. A Resolution Foundation report estimated that as many as 160,000 care workers are receiving less than the minimum wage simply on the basis of non-payment for travelling time, to say nothing of the myriad other changes to their salary. That amounts to more than £300 million and, as a sum being withheld from some of the poorest workers in the country, I find that breathtaking.

The closure of HMRC offices across the country concerns me greatly. HMRC’s enforcement work is invaluable in taking to task the criminality that sadly some employers believe is justified. The centralisation of services and cutting of jobs will inevitably give the green light to more employers to think that they can flout the law and get away with it.

[Angela Rayner]

As a former Unison activist and comrade, may I thank the hon. Gentleman for the work he has done in the sector? To come back to legality, is it not an absolute shame that many home carers will not be able to seek legal redress because of employment tribunal fees? It is unions such as Unison that enable carers to take cases to employment tribunals, because they pay the fees.

[Chris Stephens]

I agree with my Unison comrade and friend. One barrier to getting back-payments in this sector in particular is that the fees charged are often greater than the wages claimed for. I thank her for making that point.

If the green light is to be given to more employers, they will take that. In Scotland, with only two offices—in Glasgow and Edinburgh—to be retained under the proposals, it is simply not credible to suggest that, despite best efforts, HMRC’s minimum wage enforcement can continue at the same level. Given that the workforce in the care sector is female-dominated, it seems that a double whammy is created. We as a society pay women less overall and, even when a legal floor is put in place to stop wages falling below a certain level, many women are victims of their employers’ criminality and earn even less. There can be no place in a civilised society for the law-breaking that appears to be happening in areas of the care sector. A civilised Government should do all they can to stamp out that insidious practice.

Other Members have set the scene. As usual I enjoyed the contribution from the hon. Member for Sheffield Central (Paul Blomfield). He rightly said that the sector looks after the most vulnerable. The hon. Member for Ashton-under-Lyne (Angela Rayner) indicated her personal experience and the right hon. Member for Oxford East (Mr Smith) was correct when he said that it is not unreasonable to demand that the national minimum wage is paid.