Download Low Pay Commission Inquiry 2016 - TUC response (PDF)
This paper sets out our evidence to the Low Pay Commission’s summer 2016 inquiry.
Our submission examines:
In formulating our recommendations, we have taken account of the following key points:
There will obviously be some siren voices urging the Commission to be more cautious at this point but we should remember that at the moment that key economic indicators on employment and growth are still strong. We note that corporate profitability is now at record levels, so it would be hard to argue that this country cannot afford a pay rise for its lowest paid workers.
Premature pessimism risks becoming a self-fulfilling prophecy that would leave too many workers stuck in poverty pay and curtail their spending, which is needed to keep the economy growing. We will watch the economic indicators closely, but note that the Government retains discretion over whether to implement the Commission’s recommendations in April 2017. There is always a force majeure safety valve that should be seen as insuring the Commission against any imperative towards over-caution.
The LPC should recommend a further programme of work to ensure that the NMW is fully enforced. This is needed in order to counter the public perception that employers can flout the law with impunity in a climate where insecure work has become much more common. Steady increases in funding, more inspectors, proactive work and naming and shaming will all need to be rolled out.
There must also be a workable prosecution strategy that takes a steady stream of the worst employers through the courts and punishes them with substantial fines.
The current inquiry is an opportunity for the LPC to help to set the narrative for the next period of life in the UK. A positive narrative should necessarily include a rising minimum wage that helps more people, which combined with decent wages growth more broadly, would help to keep the economy moving forward.
Want to hear about our latest news and blogs?
Sign up now to get it straight to your inbox
To access the admin area, you will need to setup two-factor authentication (TFA).