The Real Benefit Cheats Are The Employers Who Are Milking The System
Cameron wants to curb in-work benefits. No wonder: just £8bn on benefits goes to the unemployed, while an estimated £76bn, according to James Ferguson of Money Week, goes to people who are working. The government says this shouldn’t be happening. Cameron insists employers should be paying wages people can live on – which, funnily enough, is the sort of thing unions say, although they no longer have any power to make it happen.
It’s what Labour says, too, now the party is out of power. When it was in power, it avoided confrontation with employers offering poverty wages, and with the unions, by kindly offering to make up the difference between the minimum wage and a living wage via the benefits system.
It would be funny if it wasn’t so sad. The Tories excoriate Labour because Labour accepted the Conservative idea that employers should be freed from the burden of social responsibility. Labour spent a lot of money on protecting employers from such irksome duties. The Conservatives still don’t want to impose such irksome duties, but don’t want to stump up for the hefty bill that ensues from failing to do so either.
Just one of the woeful consequences of Labour’s drive to support employers by supplementing employees is that it makes the figures look like the Department of Work and Pensions is showering taxpayers’ money on the feckless, when it is actually showering taxpayers’ money on businesses.
Thousands of unemployed young people across the North East could be stripped of benefits under tough plans in the Government’s Queen’s Speech.
David Cameron insisted the crackdown was designed to end youth unemployment, as he set out his plans in the House of Commons.
But Labour MPs said the plans effectively meant young people would be forced to work for as little as less than £2 an hour – payment far below the minimum wage.
The North East has the highest youth unemployment rate in England.
Office figures show 21.4 per cent of young people aged 18 to 24 are unemployed.
The figures cover people who are “economically active”, which means they are in a job or looking for work. Full-time students are not included.
This is a higher proportion than in any other part of England. It’s also higher than Scotland or Wales, and roughly equal to the Northern Ireland figure of 21.8 per cent.
By contrast, the unemployment rate for people aged 18 to 24 in the south east is 11.4 per cent. And in the West Midlands, it is 16.1 per cent.
Official figures also show that 4,000 people in the North East aged 18 to 24 have been claiming Jobseekers Allowance for six months or longer.
But under Government plans, anyone aged 21 or under will lose the right to this benefit – and be put on a new “youth allowance” instead.
They’ll get the same amount of money as before, up to £57.90 a week, but if they are unemployed for six months then they will be given compulsory community work such as making meals for the elderly or working for local charities – and they’ll lose the right to claim benefits if they refuse.
If they will have to work 30 hours a week as expected, that would be a payment of £1.93 for each hour worked, well below the minimum wage of £5.13 for people age 18 to 20 and £6.50 for those older.
The Government says it plans to prepare young people for work and will create 200,000 new apprenticeships in the North East.
And Conservatives point out that the number of people aged 18 to 24 in the North East actually in work has risen by 13,000 over the past year.
David Cameron told the House of Commons: “One of the most important things we can do is give young people the chance of an apprenticeship and the chance of work.
“What we have done is expand apprenticeships and uncapped university places, so that there is no cap on aspiration in our country.
“We now want to go further by saying that every young person should be either earning or learning.
“Leaving school, signing on, getting unemployment benefit, getting housing benefit and opting for a life out of work—that is no choice at all, and that is why we will legislate accordingly.”
And Conservative MP Guy Opperman, MP for Hexham, said:
“This Bill will provide assistance to young people to earn and learn, and give them the skills which they need to have a long term future in employment.
“We need to address the skills gap and using apprenticeships will really make a difference to do that.”
Labour Gateshead MP Ian Mearns said:
“If young people are expected to work in order to get benefits then they should be entitled to the minimum wage.
“To tell them to work for £2 an hour is ridiculous. We have legislation which says there is a minimum wage in this country and that should be the minimum level people can expect.”
Conservatives will face a battle over plans to stop people aged 18 to 21 claiming housing benefit – with Labour MPs and other critics warning it will put young people who are forced to leave home because of abuse in danger.
Source – Newcastle Evening Chronicle, 30 May 2015
Angry campaigners have accused the BBC of jumping on the poverty porn bandwagon with a new show which has parallels with the Hunger Games.
‘Britain’s Hardest Grafter’ will pit benefits claimants, migrant workers and people on the minimum wage against each other in a competition to see who can work the hardest. One of the aims of the show is to answer the question: ‘Is the benefits system providing many with a reason not to work’.
The BBC is currently seeking participants for the programme and offering a cash prize to the winner of £15,500, equivalent to a year’s income on the minimum wage. The 25 chosen contestants must currently be getting wages or benefits totalling not more than £15,500 a year.
They will then battle against each other in a fake factory built by the BBC with licence payers money. The least productive workers will be expelled in each episode until only one is left standing.
The BBC has denied that this is exploitative entertainment designed to mock the poor and reinforce ugly stereotypes. Instead they claim that:
“The series will tackle some of the most pressing issues of our time: why is British productivity low?
Is the benefits system providing many with a reason not to work or hindering their working opportunity?
Is the hidden truth about immigrants simply that they work harder than Brits – and we need them as much as they need us – or are they simply prepared to work for a lower wage?
And have the young simply not inherited the work ethic of older generations or have working conditions just got too hard? Who in Britain still knows how to graft? It’s time to find out.”
The claim that this is somehow a scientific examination of social issues is a jaw-droppingly cynical piece of marketing.
In reality, ‘Britain’s Hardest Grafter’ is simply an opportunity to steal ratings on the back of stirring up more prejudice against young people, ethnic minorities and anyone struggling to survive in austerity Britain.
A petition against the programme being shown has gathered 13,000 signatures on Change.org.
Meanwhile, Benefits and Work is hoping to see a cast of 25 recently unemployed MPs being chosen to do a hard day’s graft, possibly for the first time in their lives.
Source – Benefits & Work, 29 May 2015
Do you ever miss the era when you didn’t know what a benefit sanction was?
That innocent time, before the Department for Work and Pensions renamed a family a “benefit unit”?
One of the great luxuries of no longer having a Conservative-led government would be not having to learn any more about their intricately boring, functionally brutal social security innovations.
Look, I’m no Pollyanna. There are clearly question marks over a possible Labour/SNP coalition: how is it going to work, for a start, now that Labour has explicitly promised not to talk to the SNP? Prime minister’s questions would look like a cocktail party with two exes blanking each other. We’ll know they’re in love, but they’ll be too angry to see it.
And what, exactly, is Ed Miliband’s rent capping idea?
The beginning of a new courage, as he sets his face to the blizzard of the rentier economy?
Or a canny bid for the votes of people who don’t think any politicians are capable of anything?
These are battles for the future, and I would have them 1,000 times rather than watch unfold the nightmare of “in-work conditionality”.
As part of the universal credit pilot, last week saw the beginning of new requirements on the number of hours worked: under these regulations, anyone earning less than the equivalent of 35 hours on the minimum wage would be subject to pressure which could end in a sanction.
The second parent in the “benefit unit” would be required to work a minimum of 16 hours, taking the working week for the family up to 51 hours, before the threat of sanctions would be lifted.
Over the coming year, 15,000 families will be placed on this regime, to varying degrees of stringency: some will just be nudged with a fortnightly phone call, others will have to attend regular interviews which, as we’ve seen with the regular social security picture, comes with the ever-present risk of having your benefits removed and being left with nothing.
Labour’s Baroness Sherlock asked some searching questions in the Lords in January about the ethics of doing a randomised control trial in which one of the groups suffered a real risk to their wellbeing.
Lord Freud waved the problem off, but this is the man, remember, who thinks people use food banks because there is an “infinite demand for a free good”. He probably thinks these families only had children in the first place because they presented no immediate unit cost.
It may sound as though there is no moral dishevelment more profound than deliberately leaving parents without the money to feed their children (the cost of the trial, incidentally, is £15m, which I am prepared to bet real money is more than the scheme will ever save). But there are two other aspects, one cultural and one democratic, to consider.
First, as Lindsay Judge, who conducted research on the pilot for the Child Poverty Action Group (CPAG) to be released on Monday, points out:
“If you focus on hours, you individualise the problem of low pay. It allows employers to take their eye off pay, and it allows the state to take their eye off benefits.”
To be on low wages under this regime is to be at the mercy of many different pressures: employers who think you’re expendable and are less likely to make accommodations for you, whether that means flexibility or extra hours; government agencies who will focus on increasing your hours, regardless of what that does to your family; and an inbuilt discrimination in the fact that people on the minimum wage are expected to work more in the first place (since the “conditionality” element of universal credit is based on family income, not hours worked).
But if you were to take this policy, and the demands it makes of parents, and lay it over other debates – education, where the worthy parent is at the school gates and all over the homework; or health, where good parenting involves a lot of home baking – you can see that to be on the minimum wage is, by steady increments, becoming incompatible with “respectable” parenting. This is even starker for single parents, who are of course often judged as deficient in the first place.
The democratic deficit emerges from the CPAG’s research, in which it asked two groups, one high income and one low income, how much other parents should be expected to work. Judge describes “parents being shocked at the sharpness of the state in other parents’ lives. You come up against these sharp edges all the time when you’re a low-income family and they’re really unpleasant. People who don’t have that interaction with the state are really surprised.”
CPAG found that people tended to approach the issue as parents first and taxpayers second, concluding overwhelmingly that it has to be a question of individual choice; parents must decide for themselves how many hours they work.
“Everyone said, people should be able to make the same choices about work-life balance across the income spectrum. Policies that bear down in a coercive manner are not acceptable – and that response was found in the higher- as well as the lower-income group.”
So many benefit reforms are justified on the basis that the country is sick of a something-for-nothing culture. But when you ask in-depth questions about what other people’s lives should be like, and what kind of dignity a state should respect and uphold, a much more generous, human picture emerges.
The genius of so many of these reforms has been in the naming – “spare-room subsidies” and “work-related activity groups” – they sound like technicalities rather than financial traumas. I don’t know what the in-work conditionality would have to be called for parents to stand together against it: I’d sooner not find out.
Source – The Guardian, 26 Apr 2015
Fast food workers will be calling for an end to zero hours contracts at a protest next week.
The Darlington Trade Union Council (TUC) is backing a global day of action on Wednesday, April 15 in support of fast food workers across the country.
Organised by the Bakers Food and Allied Workers Union, the protest will see fast food workers calling for a £10 per hour minimum wage, and an end to zero hours contracts.
The action is also being supported by the Trade Unionist and Socialist Coalition (TUSC).
Alan Docherty, the party’s parliamentary candidate in Darlington, said:
“The message is clear – join a union and get organised.
“In the USA fast food workers have organised successful strikes and won. Members of my party have been instrumental in winning victories that have brought about a $15(£10) per hour minimum wage.
“This was first enacted into legislation in Seattle and now several more cities and states have followed. We can do the same here.”
The protest will take place outside Queen Street Shopping Centre from noon.
Source – Northern Echo, 08 Apr 2015
More businesses in the North-East have been ‘named and shamed’ by the Government for not paying the national minimum wage.
The businesses were revealed by Business Minister Jo Swinson and included employers not complying with minimum wage rules and having arrears of more than £100 owing to staff.
Those named and who are based in the region were:
- Mrs Karen Aitken, trading as Angel Hair Design, of Gainford, Darlington, neglecting to pay £703.33 to a worker
- Mrs Deborah Adcock, trading as LJ Beauty and Hair, of Seaham, neglecting to pay £463.60 to a worker
- Inn2inns Ltd, of Hemlington, Middlesbrough, neglecting to pay £323.10 to two workers
- Mr Assad Madani, trading as Dona Papa Pizza, in Chester-le-Street, neglecting to pay £101.64 to a worker
The Department for Business, Innovation and Skills, which published the 70 strong list, said each case had been “thoroughly investigated” by Her Majesty’s Revenue and Customs (HMRC).
Ms Swinson said: “Paying less than the minimum wage is illegal, immoral and completely unacceptable.
“Naming and shaming gives a clear warning to employers who ignore the rules that they will face reputational consequences as well as financial penalties of up to £20,000 if they don’t pay the minimum wage.”
The GMB union said there were still far too few “wage dodging employers” being brought to justice and “bucket loads of evidence” that big firms in particular could afford to pay more.
The Government said it was increasing HMRC’s enforcement budget by a further £3m a year in a bid to recover hundreds of thousands of pounds owed to workers.
The GMB also said a wage offenders register should be kept by Company House with those on it deemed unfit to hold further directorships.
The current national minimum wage for those aged 21 and over is £6.50 an hour, although the Low Pay Commission yesterday recommended to ministers it increases by 20p to £6.70 an hour.
COMPANIES NATIONALLY PAYING LESS THAN THE MINIMUM WAGE
- East Midlands Crossroads – Caring for Carers, Nottingham, neglected to pay £37,592.56 to 184 workers.
- Delcom Systems Ltd, Salisbury neglected to pay £11,731.52 to a worker.
- S Hanns LLP, Chatham neglected to pay £8,448.84 to a worker.
- The Apostolic Church trading as James Kane Nursery, London, neglected to pay £8,347.71 to 2 workers.
- Young Friends Nursery Ltd, Hove, neglected to pay £6,789.71 to a worker.
- Station Garage (Little Weighton) Ltd, Little Weighton neglected to pay £5,440.77 to 2 workers.
- KRCS (Digital Solutions) Ltd, Nottingham, neglected to pay £5,161.85 to 5 workers.
- Mrs Shirley Elvin trading as Seaton Garage & Engineering Co, Hull, neglected to pay £4,840.31 to a worker.
- Pontcanna Hair Studio Ltd, Cardiff, neglected to pay £4,784.34 to a worker.
- Carol Ann Daker trading as Swan Hill House Residential Home, Shropshire, neglected to pay £4,395.78 to 27 workers.
- Hobby Horse Ltd, Plymouth, neglected to pay £4,049.31 to a worker.
- Fylde Coast Pizza Ltd trading as Papa Johns, Blackpool, neglected to pay £3,949.62 to 14 workers.
- Manleys Ltd, Belfast, neglected to pay £3,797.83 to 3 workers.
- J B Howard and Son Ltd, Leyland, neglected to pay £3,469.96 to 7 workers.
- Mr L Tolman & Mr S Blanchard trading as Mardi Gras Hotel, Blackpool, neglected to pay £3,206.76 to 3 workers.
- Stafforce Personnel Ltd, Rotherham, neglected to pay £3,044.79 to 63 workers.
- Best Start Ltd trading as Tiny Treasures Day Care Nursery, Birmingham, neglected to pay £2,928.95 to two workers.
- Maybury Automotive Ltd, Woking, neglected to pay £2,670.88 to 2 workers.
- C&R Tyres Ltd, Kelso, neglected to pay £2,261.60 to 3 workers.
- SSE PLC, Perth neglected to pay £2,233.95 to 5 workers.
- Encore Envelopes Ltd, Washington, neglected to pay £2,060.09 to a worker.
- SmileyWorld Ltd, London, neglected to pay £1,729.00 to a worker.
- Mancroft Ltd, Leeds, neglected to pay £1,172.97 to 3 workers.
- Kevin & Bernadette Farrell trading as Derrygonnelly Autos, Enniskillen, neglected to pay £1,690.35 to a worker.
- Delves Food & Wine Stop Ltd trading as Loco, Walsall, neglected to pay £1,152.48 to a worker.
- Webe (Chelmsford) Ltd, Chelmsford, neglected to pay £1,521.98 to 4 workers.
- Gregson Lane Garage Ltd, Preston, neglected to pay £1,431.57 to 2 workers.
- Ms Julie Ann Wright trading as The Worx, Portadown, neglected to pay £1,110.60 to a worker.
- Mr S Partridge & Ms M Shead trading as Cobblers Fine Sandwiches & Pastries, Wakefield, neglected to pay £1,003.83 to a worker.
- Mr Phillip Campbell & Mrs Lorraine Campbell trading as Supervalu Kells, Ballymena, neglected to pay £905.86 to 2 workers.
- Mr C Pask trading as Pask Hair & Beauty, Derby, neglected to pay £900.00 to 2 workers.
- J&G Salon Ltd trading as Jealousi & Garlands, Tamworth, neglected to pay £881.28 to a worker.
- Faster Fit Tyres Ltd, Scunthorpe, neglected to pay £719.30 to a worker.
- Mrs Karen Aitken trading as Angel Hair Design, Darlington, neglected to pay £703.33 to a worker.
- Clearshot Ltd, Manchester, neglected to pay £684.94 to a worker.
- Everest Express Ltd, Lincoln, neglected to pay £657.03 to a worker.
- Leisure Emporium Ltd trading as Brown’s Cafe Bar & Bistro, Nottingham, neglected to pay £643.86 to a worker.
- Mrs S Walker trading as Alleyways Fish & Chips, Scarborough, neglected to pay £601.59 to a worker.
- Gary & Toni Valentine trading as The Harbour Inn, Seaton, neglected to pay £584.42 to a worker.
- Shreeji Barnsley Ltd trading as Coffee Delight, Buxton, neglected to pay £555.70 to a worker.
- Rowe Sparkes Solicitors Ltd, Southsea, neglected to pay £530.96 to a worker.
- Fish Hairdressing Company Ltd, trading as Fish Hairdressing, Maidstone neglected to pay £521.82 to 3 workers.
- Mrs Deborah Adcock trading as LJ Beauty & Hair, Seaham, neglected to pay £463.60 to a worker.
- D&D Dies Ltd, Nottingham, neglected to pay £446.37 to a worker.
- G Joynson, D Joynson and C Joynson trading as Headquarters, Withernsea, neglected to pay £430.07 to a worker.
- Matchesfashion Ltd, London, neglected to pay £375.61 to 2 workers.
- Colin Saich trading as Lindcoly Kennels, Bury St. Edmunds, neglected to pay £338.41 to 9 workers.
- Inn2inns Ltd, Middlesbrough, neglected to pay £323.10 to 2 workers.
- 99p Land Ltd, Swindon, neglected to pay £315.26 to a worker.
- General Tarleton Ltd, Knaresborough, neglected to pay £300.62 to 6 workers.
- Western Computer Group Ltd, Bristol, neglected to pay £287.54 to a worker.
- Matrix Electrical Engineering Ltd, Harlow neglected to pay £286.60 to a worker.
- Honeybees Childcare Ltd, Preston, neglected to pay £276.30 to a worker.
- Mr G J Pearce trading as Sheppards Wood Service Station, Nottingham, neglected to pay £268.56 to a worker.
- The Mirrors Ltd, Manchester, neglected to pay £262.87 to a worker.
- A1 Techsol Ltd, Manchester, neglected to pay £233.47 to a worker.
- Mrs J Cole trading as Rayleigh Retreat, Rayleigh £231.73 to a worker.
- Hamlet Homes Properties Ltd, Westcliff-on-Sea neglected to pay £226.40 to a worker.
- Smartmove Property Specialists Ltd, Aldershot, neglected to pay £206.36 to a worker.
- EYFS Ltd trading as Oak Tree Day Nursery, London, neglected to pay £181.41 to a worker.
- Mr & Mrs P Munn trading as Merry Maids of the Weald, Tonbridge, neglected to pay £169.56 to a worker.
- Mr H Singleton trading as Willowbank Builders, Huddersfield, neglected to pay £163.89 to a worker.
- Professional Referral Services Ltd, Wigan, neglected to pay £156.93 to 2 workers.
- Amtec Computer Corporation Ltd, Ferndown, neglected to pay £149.64 to a worker.
- Lychgate Coffee Ltd, Wolverhampton, neglected to pay £124.39 to a worker.
- Finite International Logistics Ltd, Penarth, neglected to pay £119.92 to a worker.
- Drummonds Ltd, Manchester, neglected to pay £113.58 to a worker.
- Grove Mechanical Services Ltd, Magherafelt, neglected to pay £107.00 to 2 workers.
- Lin Chinese Takeaway Ltd, Stoke-on-Trent, neglected to pay £103.00 to a worker.
- Mr Assad Madani trading as Donapapa Pizza, Durham, neglected to pay £101.64 a worker.
The current National Minimum Wage rates are:
Adult rate (21 and over) – £6.50 per hour
18-20 year olds – £5.13 per hour
16-17 year olds – £3.79 per hour
Apprentice rate – £2.73 per hour
The apprentice rate applies to apprentices aged 16-18 and those aged 19 and over who are in their first year. All other apprentices are entitled to the National Minimum Wage rate for their age.
Source – Northern Echo, 24 Feb 2014
More than 250,000 workers in the UK are being cheated out of the legal national minimum wage by unscrupulous employers, a damning new report reveals.
A new report from the Trade Union Congress (TUC), National Minimum Wage – Keeping up the Pressure, reveals that while the majority of employers are ‘happy’ to pay up, others are finding new ways to escape paying the legal minimum wage.
The findings may prove to be deeply embarrassing for the Tory-led coalition government, who claim to be “making work pay” and on the side of “hardworking people”.
> I doubt they are capable of feeling embarrasment or shame…
The national minimum wage rate is currently set at £6.50 per hour for workers over the age of 21, falling to £5.13 for 18-20 year olds, £3.79 for under 18’s and £2.73 per hour for apprentices.
However, the TUC says a minority of employers are adopting a ‘wide range of scams’ to avoid paying up: including under-recording hours, bogus self-employment, misusing interns and volunteers, charging for uniforms, not paying for travel between work sites during the working day, clocking workers off when there are no customers in the store or cafe, and employers vanishing to avoid minimum wage fines only to reappear under another name.
Apprentices are particularly likely to be underpaid, with figures suggesting as many as 120,000 people on apprenticeships are paid less than the legal requirement.
TUC says enforcement of the national minimum wage needs to ‘continuously improved’ and stronger punishments for employers who flout the law need to introduced, such as increasing the maximum fine from £5,000 to £75,000.
The report also calls for the appointment of 100 more HM Revenue and Customs (HMRC) enforcement officers, the naming and shaming of employers who fail to pay at least the national minimum wage and better guidance for businesses.
The TUC has outlined a 10-point programme the next government should adopt to improve minimum wage enforcement:
- Restore the budget for raising awareness about the minimum wage to £1 million.
- Hire 100 more HM Revenue and Customs (HMRC) enforcement officers
- Better official guidance on the minimum wage so that employers know their responsibilities.
- Create legal gateways so that HMRC can share information about enforcement with local authorities and the transport regulatory authorities
- Name and shame all non-payers.
- Government to guarantee arrears if employer goes bankrupt or simply vanishes.
- Adopt a prosecution strategy targeted towards the worst offenders and increase maximum fine from £5,000 to £75,000.
- More targeted enforcement for high-risk sectors.
- Make government funding for training apprentices dependent on employers paying the minimum wage, and create a duty for training providers to check that the minimum wage is paid.
- Promote collective bargaining so that trade unions can deal with more minimum wage problems themselves.
TUC General Secretary Frances O’Grady said:
“Failing to pay the minimum wage is an antisocial act that squeezes those workers who have the least. There should be no hiding place for cheapskate bosses who try to cheat their workers out of the minimum wage.
“We must engage in a constant battle to ensure that every worker gets at least the minimum. It is clear that some employers are actively looking for new ways not to pay even the legal minimum.
“There should be a broad consensus between political parties, good employers and trade unions that the minimum wage must always be enforced effectively.
“We urge everyone to support the TUC’s plan for ensuring continuous improvement to the minimum wage system.”
Source – Welfare Weekly, 08 Jan 2015
This article was written by Daniel Boffey, for The Observer on Saturday 22nd November 2014 20.28 UTC
The coalition’s record on low pay has come under attack as new figures revealed that not a single company has been prosecuted in the past year for paying less than the national minimum wage. Despite ministers’ claims that the government is getting tough on under-payers, the last successful criminal prosecution was in February 2013.
That was one of only two prosecutions during the government’s entire term of office to date, according to figures given to parliament. The cases involved the imposition of fines to the value of £3,696 on an opticians in Manchester and £1,000 on a security company in London.
The Annual Survey of Hours and Earnings for the Office for National Statistics recently found that about 287,000 workers were paid at less than the minimum wage in 2012, although the TUC puts the figure closer to 350,000.
Chris Mould, chairman of the Trussell Trust, the charity that runs 400 emergency food banks, said that the increasing numbers of people attending its facilities was clear evidence that ministers needed to do more to protect people who were living “on the edge”.
The number of people helped by Trussell Trust food banks in the first half of the 2014-15 financial year is 38% higher than in the same period last year. The trust reported this weekend that 492,641 people were given three days’ food and support, including 176,565 children, between April and September. That compared with 355,982 during the same period in the previous year.
Problems with the social security system continued to be the biggest overall trigger for food bank use (45%), of which “benefit delays” accounted for 30% of referrals, and “benefit changes” 15%, according to the charity.
However, an emerging trend, according to the charity, is that 22% of those helped were referred because of “low income” compared with 16% of referrals in the same period last year – meaning 51,000 more people were referred to a food bank due to low income.
“It is up to the democratically elected parliament to make some decisions and one route is to make it less easy for people to be exploited at the bottom of the labour market. We see people forced to cycle in and out of poverty and they are so close to the edge that it is easy for them to slip under.”
HM Revenue and Customs (HMRC) said that it prosecutes the most serious breaches of the national minimum wage “and where there is clear evidence to do so”. A spokesman said the average cost of a successful prosecution was around £50,000 and that HMRC believed it was preferable to recoup wages for workers through civil penalty powers. In 2013-14, HMRC conducted 1,455 investigations and issued 652 financial penalties.
But the shadow business secretary, Chuka Umunna MP, said that the coalition was not taking the action needed to enforce the minimum wage. Failing to pay the minimum wage was made a criminal offence in 2007. Under Labour, seven organisations were prosecuted, including Torbay council.
“The national minimum wage is one of Labour’s proudest achievements in government and it has made a huge contribution to making work pay, boosting living standards and tackling in-work poverty.
“It is clear that the Tory-led government is not going to take the action needed to properly enforce the minimum wage – so that is why Labour is clear that we need to see higher penalties for rogue companies who don’t pay employees the minimum wage and far more effective enforcement, including by giving local authorities new powers.“
An HMRC spokesman said that the number of staff enforcing the minimum wage now stood at 194 – 40 more than in 2009-10. He said:
“Paying less than the minimum wage is illegal and, as HMRC’s record shows, if employers break the law they will face tough consequences. We conducted 1,455 investigations in 2013-14, securing over £4.6m in wage arrears for over 22,000 workers.
“The vast majority of national minimum wage cases are dealt with using civil penalty powers, as this route is usually the most appropriate, ensures workers receive the wages they’re due, and provides the most cost-effective resolution for taxpayers. However, in more severe cases, HMRC will take criminal action and seek a prosecution.”
Source – Welfare Weekly, 22 Nov 2014
Thousands of low-paid workers are in line for a pay rise, with the North-East’s biggest council poised to introduce a “local living wage”.
Labour-led Durham County Council is expected to adopt a minimum wage of £7.43 an hour next month (December) – meaning more than 2,500 of the lowest paid workers, including cleaners, catering staff and lollipop men and women, could get a pay rise of up to £1,000 a year from January 1.
The raise is still below the national Living Wage of £7.85, but would cost the cash-strapped authority more than £1m a year.
Councillor Alan Napier, the council’s deputy leader, said the scheme was a fair, affordable and sustainable way of introducing a realistic and deliverable living wage.
“We believe its introduction would not only make a significant difference to the lives of our lowest paid employees but would also have knock-on benefits for the authority and wider county,” he added.
Howard Pink, from Unison, said it was a step in the right direction.
“Local government is the worst paid of the public service sectors and it’s really important to address this issue. The vast majority of people to benefit will be women,” he added.
The council has been considering adopting the living wage for at least two years.
Liberal Democrat Mark Wilkes, whose attempt to force it through by the spring was defeated in July, said: “I’m delighted. A well paid workforce returns the investment in them many times over. We will continue to push for our lowest paid workers to get a fair deal.”
No North-East council has yet adopted the official Living Wage.
Newcastle, Northumberland, North and South Tyneside and Northumberland are working towards increasing their lowest pay levels and Scarborough adopted a minimum wage of £7.45 last November. Sunderland is committed to becoming a Living Wage employer by April.
Durham cannot force its will on schools, where the majority of the lowest paid work, as their pay is controlled by governors.
But Mr Pink said: “If schools are reluctant to bring it in, we will want to discuss that with them.”
The proposals will be debated at a full council meeting on Wednesday, December 3, at Durham’s County Hall.
Source – Durham Times, 19 Nov 2014