"From fish factories in Grimsby to coffee shops in central London and even Waitrose supermarkets, workers across the country are seeing perks and pay rates cut as companies try to offset the cost of George Osborne’s national living wage.
Tomorrow, just over two weeks after the new minimum pay rate of £7.20 an hour for over-25s came into force, MPs will debate the effect the 50p rise in basic pay has had on thousands of workers. In the past few weeks the Observer has learned of companies withdrawing overtime and Sunday pay, bonuses, free food and paid breaks in order to keep the wage bill down.
Siobhain McDonagh MP, who called the backbenchers’ debate, said: “When the chancellor announced the national living wage, he said, ‘Britain deserves a pay rise and it’s getting one.’ I took him at his word on that. People should get a pay rise, not a pay cut.” (AtW's comment: for that people should get a better chancellor... businesses will be cutting even more because with much higher dividend tax they'd need to produce higher profits to keep shareholders happy)
She began campaigning after a constituent who works for B&Q reported that a rise in basic pay was being accompanied by cuts to Sunday and bank holiday pay as well as bonuses. It emerged that her constituent would be more than £2,000 a year worse off. She has since met other B&Q workers who are set to lose out, including one whose take-home wages will drop by 30% with the loss of Sunday pay. They had worked at the retailer for almost 20 years.
McDonagh argues that the government should look at preventing businesses offsetting the cost of the national living wage by cutting perks. That could include insisting that staff are paid for the legally required 20-minute break in a six-hour shift.
Along with the national living wage, the chancellor also announced a cut in corporation tax to help companies afford it. Corporation tax will fall from 28% in 2010 to 17% in 2020, giving businesses a £15bn tax break. McDonagh says: “If business is getting £15bn, the people who help them make their profits deserve a bit of that.” (AtW's comment - it's 20% now and increased dividend tax more than offsets reduction in corp tax, so things actually got worse!)
Gareth Jones, deputy regional secretary of the Unite union in Wales, is backing workers at Toyoda Gosei, a car parts manufacturer with plants in Swansea and Rotherham, which has put an end to paid breaks. He said: “Employers are not entering into the spirit of the national living wage. Unite regional officer Dave Monaghan agreed: We believe these cuts breach the whole point of the national living wage – to give low-paid workers a step-up.”
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More from the source: Employers claw back living wage in cuts to perks, hours and pay | UK news | The Guardian
Tomorrow, just over two weeks after the new minimum pay rate of £7.20 an hour for over-25s came into force, MPs will debate the effect the 50p rise in basic pay has had on thousands of workers. In the past few weeks the Observer has learned of companies withdrawing overtime and Sunday pay, bonuses, free food and paid breaks in order to keep the wage bill down.
Siobhain McDonagh MP, who called the backbenchers’ debate, said: “When the chancellor announced the national living wage, he said, ‘Britain deserves a pay rise and it’s getting one.’ I took him at his word on that. People should get a pay rise, not a pay cut.” (AtW's comment: for that people should get a better chancellor... businesses will be cutting even more because with much higher dividend tax they'd need to produce higher profits to keep shareholders happy)
She began campaigning after a constituent who works for B&Q reported that a rise in basic pay was being accompanied by cuts to Sunday and bank holiday pay as well as bonuses. It emerged that her constituent would be more than £2,000 a year worse off. She has since met other B&Q workers who are set to lose out, including one whose take-home wages will drop by 30% with the loss of Sunday pay. They had worked at the retailer for almost 20 years.
McDonagh argues that the government should look at preventing businesses offsetting the cost of the national living wage by cutting perks. That could include insisting that staff are paid for the legally required 20-minute break in a six-hour shift.
Along with the national living wage, the chancellor also announced a cut in corporation tax to help companies afford it. Corporation tax will fall from 28% in 2010 to 17% in 2020, giving businesses a £15bn tax break. McDonagh says: “If business is getting £15bn, the people who help them make their profits deserve a bit of that.” (AtW's comment - it's 20% now and increased dividend tax more than offsets reduction in corp tax, so things actually got worse!)
Gareth Jones, deputy regional secretary of the Unite union in Wales, is backing workers at Toyoda Gosei, a car parts manufacturer with plants in Swansea and Rotherham, which has put an end to paid breaks. He said: “Employers are not entering into the spirit of the national living wage. Unite regional officer Dave Monaghan agreed: We believe these cuts breach the whole point of the national living wage – to give low-paid workers a step-up.”
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More from the source: Employers claw back living wage in cuts to perks, hours and pay | UK news | The Guardian
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