Springfords LLP blog

Some news, views and comments about everything and anything, relevant and irreverent.

Minimum Wages: For a Fair Day's Pay?

21 January 2015

Despite what some unscrupulous employers may seem to think, the minimum wage is not a recommendation, it’s a law.

With a cover price of £2.50 it would take a minimum wage worker just over 23 minutes to earn enough money to pay for a daily copy of the Financial Times.  It would not even take 23 minutes for them to read the news that over three dozen companies, from fashion retailers to hospitality providers, are being prosecuted for failing to fulfil their obligations to pay workers at least the national minimum wage rate of £6.50 an hour, for those 21 years of age and over.

Suffice to say, it is likely that those workers doing their best to get by on £52 for an eight hour day will have higher purchasing priorities than the famously well informed pink broadsheet.

The majority of the UK workforce is entitled to receive the minimum wage. It covers full-time and part-time workers and casual and agency staff as well. Being a trainee, or an apprentice, or working from home or working out in the fields or at sea doesn’t matter. Whether you speak English, or hold a foreign passport, that £6.50 figure is the bottom line that cannot be undercut.

Flouting the rules can prove an expensive embarrassment. Among the companies slapped with fines of over fifty grand and named by Jo Swinson, the Westminster Business Minister, were High Street fashion chain H&M and the motorway service station parent company Welcome Break Holdings.  Both were guilty for under-paying their workforce by a few thousand pounds and are now about ten times that amount out of pocket. The other miscreants didn’t escape the spotlight either. The Independent newspaper was among the titles that published the list in full, including companies large and small, all of whom will have to make good on the unpaid wages as well.

Of course, the legislated minimum is only a floor level. What you, your employee, the market, or the job in hand dictate as the value for the work, is the real measure of the reasonable pay rate. Whether any moral obligation adds to your legal requirement is up to you.

Every year since its introduction, there has been a regular increase in the minimum wage. With a general election just around the corner, the TUC are lobbying, and various politicians are stepping up the rhetoric to have the minimum wage ramped up once again. 

Government funds are being allocated to policing proper payment, and that is good news for the estimated 300,000 employees in the UK who are currently paid too little.  It is good news as well, for the vast majority of employers who do the right thing, and make sure their workers are not illegally exploited as it levels up the competitive playing field.



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