Newham Mayor Sir Robin Wales is cracking down on poverty pay
- Credit: Archant
I recently commissioned research on low pay in Newham which has left me genuinely shocked and determined to act. Half of Newham residents in work say they receive less than the voluntary London living wage – £8.80 per hour. One-fifth over 21 in work say they earn less than the legal national minimum wage – £6.31. There are some understandable exemptions – residents working in family business who live with their employer as well as younger people who are guaranteed a lower rate. I will not force reasonable family businesses to shut up shop or stop our youngest workers from embarking on careers, but the low pay scandal must be tackled.
Newham Council has a good record targeting employers who knowingly dodge the minimum wage. Our enforcement officers uncovered more breaches in one morning than there have ever been prosecutions for non-payment across the whole country. It is a disgrace that laws introduced to prevent poverty pay are so poorly monitored and enforced. Newham Council has paid all directly employed staff at least the London living wage since 2011. Government has responded to our calls for better enforcement of the minimum wage by announcing increased fines of £20,000 from £5,000.
I want us to do more. Newham Council should protect workers wherever we pay contractors to deliver services, including cleaning, social care, security and other traditionally lower paying jobs.
I have this week commissioned a review of all these service contracts to ensure that from April 2015 no one is effectively paid less than the minimum wage. We will rule out dodges such as deducting travelling time from a day’s work and charging for uniforms or supplies. Next we will work with businesses, trade unions and academics on the reasons for low pay across Newham, the impacts on residents and businesses, the costs to tackle it and identifying solutions. Hard-working families on poverty pay are doing the right thing and deserve our help and support.