A group of 30 Labour MPs have written to Chancellor Rishi Sunak today to urge the government to set a minimum wage floor within the coronavirus job support schemes being offered.
The Labour left signatories of the letter organised by Richard Burgon are calling on the Chancellor to ensure that no worker in the UK is paid less than the minimum wage during the pandemic.
The ‘national living wage’ – for those aged 25 and over – is supposed to be £8.72 an hour, the national minimum wage for those aged between 21 and 25 is £8.20 and for those aged 18 to 20 is £6.45 an hour.
But under Sunak’s new local furlough scheme being implemented from November, minimum wage workers can be paid just two thirds of the minimum rates if their workplaces are forced to shut.
The so-called ‘national living wage’ available to workers aged 25 and over can be paid as low as £5.81 per hour, equivalent to the minimum wage level of 11 years ago, as Burgon recently pointed out in the Commons.
The Chancellor’s local furlough for businesses in Tier 3 areas, under the toughest Covid restrictions, will see the government pay 67% of a worker’s wage if their employer’s business is forced to close.
Under the new job support scheme (JSS), which was changed last week to be more generous to employers, workers who go down to a fifth of their hours will receive just over 73% of their normal salary.
The Low Pay Commission has estimated that 35% in hair and beauty jobs, 29% of hospitality jobs and 19% of retail jobs pay at or below the minimum wage – all sectors hit hard by Covid-19.
Labour MPs are making the case for a floor in the Covid-19 job support schemes under which pay cannot be set – or they say the government risks causing hardship and “undermining” the national minimum wage.
Burgon, the MP for Leeds East who ran for the deputy leadership earlier this year, said: “Even before this crisis, many minimum wage workers were struggling to get by. Now they are going to be forced further into poverty.
“Given the cost of rent, bills and food have stayed the same, how can we expect people to manage on just two-thirds of the minimum wage? It’s called the National Minimum Wage for a reason – the government needs to act to ensure that nobody is paid less than it.”
The letter’s signatories, including many figures from the last Labour leadership such as Jeremy Corbyn and John McDonnell, are exclusively from the left of the party and from the opposition backbenches.
Below is the full text of the letter to Rishi Sunak.
A Minimum Wage Floor in the Job Support Scheme
Minimum wage workers in workplaces forced to shut in very high virus areas will, from next week, be paid just two-thirds of the minimum wage under the Job Support Scheme.
For workers aged 25 and over, this will be as low as just £5.81 per hour, equivalent to the minimum wage level of 11 years ago. For younger workers it will be even less.
Many workers in businesses not forced to close also face being paid less than the minimum wage.
No-one should ever be expected to live on less than the minimum wage.
Without such a minimum wage floor to the Job Support Scheme during this pandemic many of our constituents will receive pay that is completely inadequate to meet even their basic needs. Even before the pandemic many of them were struggling to make ends meet because of low pay.
A high proportion of workers in the sectors hit hardest by this pandemic are paid the minimum wage, and many will already have lost a significant amount of their income as a result of this pandemic. The Government has a responsibility to ensure that this public health crisis does not become a social crisis for millions of people.
The introduction of the minimum wage was an important step forward in the campaign against low pay and that must not be undermined during this pandemic.
We ask you to urgently review this matter and introduce a minimum wage floor to financial support during this pandemic so no worker is paid less than the minimum wage.
Richard Burgon MP
Diane Abbott MP
Tahir Ali MP
Paula Barker MP
Apsana Begum MP
Olivia Blake MP
Ian Byrne MP
Jeremy Corbyn MP
Jon Cruddas MP
Mary Foy MP
Margaret Greenwood MP
Rachel Hopkins MP
Kim Johnson MP
Ian Lavery MP
Clive Lewis MP
Tony Lloyd MP
Rebecca Long-Bailey MP
John McDonnell MP
Ian Mearns MP
Grahame Morris MP
Kate Osamor MP
Kate Osborne MP
Bell Ribeiro-Addy MP
Lloyd Russell-Moyle MP
Zarah Sultana MP
Jon Trickett MP
Claudia Webbe MP
Mick Whitley MP
Nadia Whittome MP
Beth Winter MP
Mohammad Yasin MP