Terms and Conditions of Employment

Debate between Chi Onwurah and Layla Moran

Tuesday 19th February 2019 Commons Chamber

[Chi Onwurah]

The hon. Gentleman is absolutely right. A Government who cannot even guarantee a decent wage to their own employees should not be able to speak in this debate. I hope that the Minister will clarify the points that I have raised and confirm that a real London living wage will be paid to the Government’s employees. It is totally within their ability to do so.

The increase in the minimum wage will be of some help to the lowest paid, but it will not be transformative. It will not tackle extreme and growing levels of inequality, and it will certainly not end the growing levels of in-work poverty faced by millions. Even if it was a sufficient safety net, the minimum wage would not catch all workers. With the growing gig economy forcing more and more workers into sham self-employment, it is more important than ever that every worker is paid a decent living wage. However, the minimum wage does not cover self-employment, and TUC figures show that almost half of self-employed people earn less than the minimum wage, meaning that 2 million self-employed workers are now stuck on poverty pay. Does the Minister think that that is acceptable? What is she doing to address poverty pay among the self-employed?

Another glaring inconsistency is the huge discrepancy in the minimum wage for people over 21 and for those aged 18 to 20. Will the Minister set out why the Government believe that workers aged 18 to 20 should be paid a far lower rate than those aged 21 for exactly the same work? Why is the adult rate for under 25s less than for those over 25? What is it about a 24-year-old doing exactly the same work as a 26-year-old that leads the Minister to believe the former deserves less?

[Layla Moran (Oxford West and Abingdon) (LD)]

Does the hon. Lady agree that the anger felt by young people is palpable? The message that the Government are sending is, “By being younger, you’re not worth as much as someone who is older than you.” What kind of message is that for young people?

[Chi Onwurah]

The hon. Lady makes an excellent point. What message is being sent to the under-25s about their contribution to our economy? They are exactly the people whose confidence and contribution we need to promote, especially during these difficult times.

In its latest report, the Low Pay Commission found that more than 200,000 workers were underpaid by a cumulative total of £15.6 million last year. From 2017, measured underpayment for those aged 25 and over increased to 23% of all those covered by the national living wage. Does the Minister agree that is simply not good enough?

Labour will stand up for workers against unscrupulous employers by properly resourcing Her Majesty’s Revenue and Customs, which is critical to enforcement, and will strengthen the enforcement of labour laws. We will crack down on employers that breach labour market rights and regulations through increased fines and sanctions.

Labour is committed to making work pay, which is why we will ensure a real living wage of at least £10 an hour for all workers aged 18 and over. There is no justification for differential rates based on age. Increasing wages, particularly for the lowest paid, would not only immediately help those workers and their families but would increase demand in our economy and reduce the subsidising of low pay by the state. Given the Government’s chaotic handling of Brexit and the perilous state of our economy as a consequence, does the Minister agree that the economic benefits that a significant increase in the living wage would create are desperately needed?

It is important that the state sets a minimum rate of pay based on the Low Pay Commission’s recommendations, but state minimums are just one part of the solution to low pay. Trade unions are the collective voice of workers and are best placed to bargain over what workers are paid, within a negotiating framework that includes employers. Does the Minister agree that it would be far better if workers had a direct voice in the setting of their pay through, for example, national sectoral collective bargaining?

Workers in this country deserve far better than this Government are offering, and they deserve far better than this Government. That is why Labour will set up a new Department to roll out sectoral collective bargaining, protect the interests of workers and strengthen trade unions, introducing new rights and freedoms so that every worker gets the support, security and pay at work they deserve. This Government are clearly incapable of doing that, but I hope the Minister will at least be able to answer my questions.