Inequality leads to unrest at work

20 January 2014

According to a report, the recent rise in levels of sickness and strikes is due to inequality and low pay at work. It seems that workers are not satisfied with the low pay that many of them receive in comparison to their fat cat bosses.

The think tank – the High Pay Centre said that workplaces with a substantial difference in pay between the highest and lowest waged are more likely to suffer from strikes and sickness than workplaces with a more equal pay ratio.

High Pay Centre director Deborah Hargreaves said:

“High executive pay is not only frequently unmerited but has a huge hidden impact on the rest of the organisation and society as a whole.

“Whether it’s through staff turnover, sickness, low morale or industrial action, big pay gaps undermine employees’ loyalty to the company and their managers.

“Employers suffer lost productivity, have to pay more sick pay and legal and recruitment costs as staff left feeling the financial and emotional strain are driven even further into the ground.”

The Morning Star also reported today, 20 January 2014, that a shocking 2,000 workplaces had bosses who are paid ten times the amount of the lowest paid employee.

A survey conducted by the High Pay Centre highlighted various cases where unequal pay led to an unsurprising increase in unrest at work.

The report showed that in companies where the highest wage was eight times that of the minimum, led to at least one case of work related sickness a year. On the other hand, workplaces where the difference between the maximum and minimum wage was five times greater or less, didn’t face any such problems.

Despite the London Mayor claiming that a bigger pay gap encourages employees to work harder (yes Boris!), it is clear that the effects of inequality are proving to be detrimental to workplaces and cause unrest and protests.

Similarly, the current government boasts about a rise in employment, ignoring the fact that minimum wage and zero hour contracts are becoming massive problems. Such contracts are unfair and any growth in employment based on such contracts offers no sustainable solution to the problems facing the UK.

The IER believes that the way forward is through collective bargaining, ensuring not just a higher wage for workers (collective bargaining results in a 15% lift in wages) but a more equitable distribution of income.

The consequential effect of this will be people being more willing to spend money and thus creating more job opportunities due to an increase in demand.

This means that the more one pays workers the more the economy will gain in return. As a result it will mean people will be happier due to a fairer wage and the country will gain more financial stability in return.

The IER is also planning a regional tour to promote our collective bargaining proposal. No dates have yet been set but if you are interested we urge you to watch this space for more information and dates that will be posted soon.