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Workers get ripped off by stingy bosses

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Issue 1708

Minimum wage

Workers get ripped off by stingy bosses

NEW LABOUR boasts that introducing the minimum wage has lifted one and a half million workers out of poverty. But a new report, Winners and Losers, by the Citizens Advice Bureaux (CAB) in the north east of England shows that the reality for many workers is very different.

It gives a devastating picture of workers trapped in low paid and unorganised workplaces. In April 1999 New Labour set the minimum wage at a miserly rate of 3.60 an hour, and just 3 an hour for workers under 21. It does not apply for those under 18.

The report slams the government for using a “light touch” when it comes to enforcing the minimum wage. There are just 115 inspectors to cover the whole of Britain. Yet even this is too much for some bosses to stomach. They are using a whole range of dirty tricks to claw back the costs of the minimum wage, says the Citizens Advice Bureau report.

It singles out owners of private care homes as the main culprits.

But cleaning contractors, security firms, and owners of small shops and restaurants are also flouting the minimum wage. The report found 19 cases out of the 102 studied where bosses had sacked workers on the introduction of the minimum wage.

Bosses would then hire younger workers on the lower rate for under 18 year olds. Other bosses simply refused to pay the minimum wage. One man earned just 65 for working a 48 hour week as a kitchen assistant in a small hotel-just 1.35 an hour. He left because his boss refused to discuss raising his wages.

A 31 year old student took a job as a waiter over the summer holiday. The job was advertised in the job centre at 3.60 an hour, but after he started he was asked to “sign something” agreeing to lower pay. Other bosses slashed working hours and overtime. Some bosses increased workloads, removed paid breaks and cut holiday entitlements.

Reductions in working hours meant workers lost between 14.40 and 118.80 a week. A part time garage cleaner was given the minimum wage, but her boss told her he would “make something for you to do every minute of the day from now on”. A security guard had his wages increased from 2.80 to 3.60 an hour, but his boss then slashed his weekly hours from 37 to 24.

So instead of the rise of nearly 30 the worker had expected, his pay was cut by 17.20 a week. Employers also acted in “petty and vindictive” ways, such as cutting paid breaks. One private care home boss started charging workers 9 a week for tea and coffee.

Many of the workers in the survey were not prepared to put up with such treatment. Three people at a florist’s shop got together to ask their boss for a rise after they heard a radio programme about the minimum wage. He told them, “I can do anything I like with part timers-finish them, cut their hours down. Basically I can treat them like shite.”

One worker then walked out of the job, and later won nearly nine weeks back pay. A shop boss told one of his workers that he couldn’t afford to raise her pay from 2.50 an hour. The worker told him he “could afford to drive a Volvo, so he could afford to pay her the minimum wage”.

Many workers have become disillusioned, says the report. As one client, previously on 2.50 an hour, reported, “You think about it differently when you’ve been getting the minimum wage for a while. At first it was great, because it was an increase, but now I just see it like a very low wage.”

The government is set to raise the level of the minimum wage by just 10p an hour in October this year. As the report points out, never has there been a greater need for trade unions to get stuck in and organise in workplaces like care homes, security firms and burger bars.

  • Winners and Losers: The National Minimum Wage in Tyne and Wear is available from the National Association of Citzens Advice Bureaux, Northern Region. Phone 0191 233 0700. Fax 0191 233 0722.

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