‘A just share’ – The case for minimum wage reform

Kate discusses her new report, and the case for reforming the minimum wage so all workers can take home a just share for their work

Commentary icon9 Dec 2021|Comment

Kate Ewing

Pompeu Fabra University, Barcelona

The COVID-19 pandemic has demonstrated more than ever that some of the most important workers for a functioning society are those subject to disproportionately poor working conditions in terms of pay and fragmented and precarious work practices.  Workers who have been expected to stand on the front line in the face of real danger, initially unprotected or under-protected from the risk posed by the virus, and who all too often in return could not and cannot even expect to receive the lowest legal minimum in respect of wages.  With emerging concern about the new Omicron variant, these workers may be thrust into the front line of further vulnerability once again.

Increasing the minimum wage must be backed by measures which ensure that the minimum wage is actually paid to and received by workers.

Meanwhile, the Government claim that it ‘wants to make the UK the best possible place to live and work’.  It further notes that ‘[l]ow paid workers, including many key workers, have made incredible contributions during the Covid-19 pandemic.’  However, contrary to this recognition and governmental aspiration, the pandemic and the way in which low paid workers have been treated have laid bare some fundamental structural problems within various sectors, and in relation to the NMW framework specifically, which undermine worker protection and dignity.  For instance, the exceptional contributions of low paid workers throughout the pandemic are not matched by minimum wage protections which are sufficiently resilient and crisis proof.

‘A just share’ argues that significant reforms to the NMW framework and the way in which minimum wages are secured are necessary in order that all workers enjoy a decent wage and to ensure that all workers enjoy pay security and dignity in line with the internationally recognised standards, to which the UK is a signatory.  Commitments which have been renewed and further embedded into the UK’s post-Brexit future.  While an immediate increase to the minimum wage of £10 per hour as proposed by the TUC, or a government proposal to grant workers a right to request a stable contract after 26 weeks should not be rejected out of hand as potential remedies to the situation, it is argued that such measures are too modest to have the impact needed to address the issues faced by low paid workers.

Increasing the minimum wage must be backed by measures which ensure that the minimum wage is actually paid to and received by workers.  The problems with the existing minimum wage framework are profound and contribute directly to the ongoing vulnerability and exploitation of low paid workers.  The way in which the NMW operates in practice and the way in which some employers engage with the NMW, and are permitted to engage with the NMW, are at the heart of the issues.  Workers need clear minimum wage protection which exists not simply in theory but in practice, in a way which is enforceable and enforced.  ‘A just share’ examines key issues with the current NMW framework in the UK via three case studies.  These seek to demonstrate three specific barriers for workers seeking NMW protection:

  • Case Study 1: Uber BV – employment status as a barrier to protection;
  • Case Study 2: Mencap – determining what counts as work ‘time’ for the purpose of the NMW;
  • Case Study 3: Harris – enforcing the right.

While these are not the only problems within the legal protection of low paid workers, it is argued that they represent three key vulnerabilities which contribute to the need for urgent reform.

Workers who have been expected to stand on the front line in the face of real danger ... cannot even expect to receive the lowest legal minimum in respect of wages.

Quite simply, attempts to evade NMW obligations must be stopped.  Furthermore, the normalisation of NMW avoidance as a legitimate business practice – an attempt to reduce the scope rather than evade it entirely – must be addressed if the NMW is to serve a protective purpose and be consistent with the Supreme Court finding in Uber BV that ‘[l]aws such as the National Minimum Wage Act were manifestly enacted to protect those whom Parliament considers to be in need of protection and not just those who are designated by their employer as qualifying for it.’  A construction of a protective minimum wage from the Supreme Court which is at least partially reminiscent of the ILO’s Declaration of Philadelphia which demands ‘a minimum living wage to all employed and in need of such protection’.  This is a foundational principle.

Finally, and importantly, each case study also demonstrates the very real value of unions in supporting workers.  The unions involved in the case studies are of varying sizes and resources, use different tactics for organising and strategic litigation to advance wider objectives for their members.  The case studies also demonstrate that the current system is unsustainable and unfair given that despite union support, resources and expertise, each case took four or five years simply to establish basic principles in terms of entitlement to minimum wage and basic articulation of what minimum wage entails.  Reform, of a significant nature, is urgently needed to protect low paid workers in the UK to ensure dignity, decent wages and ‘a just share of the fruits of progress to all.

Kate Ewing

Kate Ewing is a PhD student at Pompeu Fabra University in Barcelona, the focus of her work is the minimum... Read more »