The Bill introduced into Parliament late last year provides the framework for the National Minimum Wage. Key issues such as the level at which it will be set and which workers it will cover, will only be settled after the Low Pay Commission reports in May. A lot will depend on what the Commission’s report has to say. It will provide an important platform for mobilisation by the left to ensure that the final legislation is as favourable as possible. The Commission consists of three bosses, three academics, Bill Callaghan of the TUC, Rita Donaghy of UNISON and Paul Gates of KFAT, the footwear and clothing union. Final decisions on the legislation will be taken by the government i.e. by Tony Blair. And on the ‘slow track’ principle adopted by New Labour, the minimum wage will not become operative until 1999.
Key issues are
Level: TUC policy requires that the wage should be set at half male median earnings - around £4.60 an hour. This would cover some 4.5 million workers. But unless it was accompanied by changes in tax and welfare it would have only a marginal impact on poverty. In practice TUC staff continue to refer to ‘a figure around £4 an hour’. having fought strenuously at recent Congresses to avoid any figure at all. The CBI are offering a magnanimous £3.20 an hour. And Blair on his munificent salary favours a handsome £3.50 an hour. Three things are certain. Firstly, if the figure is set at under £4 it will be a waste of time the low paid would have to work more than 70 hours a week to be free of dependence on benefits. Secondly, the betting must be on a figure of less than £4. And thirdly, union leaders on £70,000 a year will urge patience if it is! After all its a start, its the principle that’s important, I’ve got to get back to the Bank of England.
Coverage: The Bill states that the government will not have powers to vary the rate by region, employment sector, occupation or the size of the enterprise. But the armed forces will not be covered. And employers are frantically lobbying for workers under 26 years of age or under 21 years of age to be exempted on the lines suggested by Peter Mandelson. This possibility is left open by the Bill. If workers under 26 were excluded then this would hit around 2 million young people in hotels and catering, retail, clothing, manufacturing and cleaning where they make up the majority of the workforce.
Enforcement: Bosses will have to keep records and provide workers with statements of their entitlements under the legislation. Workers will be able to sue bosses who break the law in industrial tribunals and the county courts and be protected against harassment and dismissal if they do so. Failure to pay minimum rates will also be a breach of the Criminal Law, Department of Trade and Industry inspectors will be able to take companies to court. But the maximum fine for each offence will be a miserly £5,000.
Workers Action: We should curb our instincts towards abstract militancy and join with quite moderate people willing to fight for £4.60 an hour as a start. This would give limited help to around 6 million workers around two-thirds of them women. We should hammer home the fact that those who earn low wages work long irregular, inconvenient hours in appalling conditions in insecure jobs. And emphasise that the national minimum wage and its enforcement mechanisms will always be inadequate to a real break from poverty. There is a need to use the legislation on the minimum wage together with that on recognition as a springboard for organising drives to unionise Britain’s sweated trades.