Living Wage

Debate between Siobhain McDonagh and Liz Kendall

Thursday 3rd November 2016 Commons Chamber

[Siobhain McDonagh]

I completely agree with my right hon. Friend, and I will go on to say how cuts in pay never seem to apply to those at the top of an organisation or to impact on its profits.

Steve Rowe, the chief executive of Marks & Spencer, still refuses to meet MPs to discuss these changes, and he has not accepted that he should have a pay cut in solidarity with his shop-floor staff. I hope Members will bear all this in mind when they are doing their Christmas shopping at M&S next month.

The fact that this happens at the same time as low-paid workers have been promised a pay rise by the Government is incredible. In many ways, B&Q and Marks & Spencer have just been unlucky in being singled out, because there are many more doing the same thing.

[Liz Kendall (Leicester West) (Lab)]

My hon. Friend has secured a really important debate. Is she aware of very similar problems at Samworth Brothers in my constituency? Long-serving workers are seeing their night shift and weekend work pay cut; there is no recognition of a trade union; and the bosses are refusing to provide information and are not taking a pay cut themselves. Does my hon. Friend agree that that is unacceptable and that they should commit to the spirit and the law of the legislation?

[Siobhain McDonagh]

My hon. Friend has anticipated my next paragraph, which was to congratulate her on the work she has been doing at local employer Bradgate Bakery, which is part of Samworth Brothers. Somebody doing the Saturday night shift at Bradgate this week will earn 30% less in three years’ time than they will this Saturday. How can that happen in the 21st century? Over the way in Grimsby, the Seachill fish factory, which works for The Saucy Fish Co, has cut overtime payments, despite the fact that overtime work is written into the employees’ contract.

Smaller benefits are also being ruthlessly got rid of. I hope Members will excuse the way I pronounce the name of the next company, but Le Pain Quotidien, where a cup of tea will set you back £3, cut paid breaks this year, while Zizzi has cut the range of free food options available to staff. Caffè Nero baristas are no longer eligible for free food on their lunch breaks, which saves the company about £3.60 per staff member. It seems that all retailers are racing to the bottom and cutting everything they possibly can to save a few pennies here and there.

It looks like the John Lewis Partnership—the top retailer on our high streets—will be the next big employer to cut staff pay, potentially going the same way as M&S and B&Q. Having already got rid of Sunday and bank holiday premiums for new starters, its chairman has outlined plans to “review historic pay structures”. In other words, it, too, will potentially cut the terms and conditions of the oldest and most loyal employees.

Each of those cases demonstrates that we desperately need to tackle in-work poverty and the unscrupulous pay practices and governmental inaction that lead to its entrenchment. Years ago, a typical family in poverty would be out of work, but now they are far more likely to be in work on low pay. According to the Resolution Foundation, almost a quarter of UK workers earn less than the real living wage—the equivalent of £16,500 a year for a full-time week outside of London, and £19,000 in London. A staggering 1.5 million workers earn only the statutory minimum wage of £7.20 an hour—that is just £15,000 a year for a 40-hour week.