HC Deb 01 February 1977 vol 925 cc212-5
5. Mr George Rodgers

asked the Secretary of State for Employment what action is being taken against those employers who have been found to have underpaid workers following investigations made by officers of his Department.

16. Mr. Canavan

asked the Secretary of State for Employment what action he proposes to take as a result of the revelations by the Wages Inspectorate about employers under-paying certain categories of low-paid workers.

17. Mr. David Watkins

asked the Secretary of State for Employment what measures he is taking to ensure that not less than minimum statutory wages are paid to workers in employment covered by wages council settlements.

The Under-Secretary of State for Employment (Mr. John Grant)

Employers found to have underpaid workers are required to pay any arrears calculated to be due to the workers concerned and prosecutions are considered in appropriate cases. I am considering the extent to which further blitzes will take place this year. I have examined prosecution policy carefully and while in general I believe it is right I am asking the Wages Inspectorate to arrange inspection priorities so that follow-up visits are made to employers found to be under-paying wages. I also propose to discuss problems of enforcement with chairmen of wages councils and both sides of industry.

Mr. Rodgers

Is my hon. Friend aware that there is widespread appreciation of the action of the Inspectorate in pursuing those employers who have consistently underpaid their work force? Does he agree that a few prosecutions might well encourage employers who do not pay enough to honour their wage agreements? Does he anticipate that he will receive support from Opposition Members who are apparently so enthusiastic about law and order?

Mr. Grant

First, I take the opportunity to pay tribute to the work of the Wages Inspectorate. I pay tribute to its co-operation and hard work during the present campaign. It is only fair to point out that the policies that we are pursuing have been pursued by successive Governments. Perhaps the difference is that we are really trying to make them stick. Although we prosecute, I must tell my hon. Friend that there are difficulties, especially in obtaining witnesses. For example, a number of serious cases of underpayment involving substantial numbers of workers in the catering industry have recently been discovered, but despite its best efforts the Inspectorate has been unable to obtain witnesses who are prepared to give evidence in court.

Mr. Canavan

In view of recent revelations by the Low Pay Unit and by newspapers such as the Daily Record, about the plight of low-paid workers, I support my hon. Friend the Member for Chorley (Mr. Rodgers) in urging the Minister to prosecute more employers. Although I agree that the best way for workers to ensure a fair wage is by joining a good trade union, may I ask my hon. Friend to investigate claims in yesterday's Scotsman that about 20,000 of Scotland's lowest paid workers have lost about £2 million over the past year because Scrooge-type employers are too mean to agree to the amalgamation of the Scottish and English wages councils, which would help to get rid of some of the unfair regional disparities?

Mr. Grant

I think that my initial answer indicated that we are taking further action, which should lead to additional prosecutions where they are justified. As for the distinction between England and Scotland, we are considering in certain cases the possibility of the amalgamation of wages councils, but I must point out that they are independent bodies and not subject to Government control in respect of the rates that they set.

Mr. Watkins

Does this not reveal a scrounging attitude among certain employers over their labour, and are they not imposing on the good nature of employees in the absence of strong labour organisations?

Mr. Grant

I agree with my hon. Friend. I have condemned this situation on past occasions. I have outlined action that we intend to take, which we hope will deal with the problem.

Mr. Hordern

Is the Minister aware of the Craik case, reported in the Daily Mail last week? Will not enforcement of a minimum wage policy lead to the unemployment of many thousands of people, and will it not also cause the closure of many small firms? What is the sense in that?

Mr. Grant

The gentleman concerned in the case to which reference is made seemed to be inviting some subsequent action. It would not be proper for me to comment on the details of the case, except to say that if somebody throws down the gauntlet he should not be surprised if it is picked up.

On the general point, the hon. Gentleman should make up his mind whether he agrees with a statutory minimum wage—a policy supported by successive Governments. If he believes that there should be a different policy he should say so, and get the support of his hon. Friends.

Mr. Penhaligon

May I congratulate the Government on what they have done so far, which has helped individual constituents of mine, who are most thankful to the Government? Is not the whole wages council set-up so archaic and complicated that the vast majority of employees do not know what the minimum wage is? Is it not time for a major reform and for the introduction of some understandable, sensible wages legislation?

Mr. Grant

There are several points involved in that supplementary question. The Employment Protection Act has had a considerable effect on the overall situation. I appreciate that there are difficulties in understanding some wages council orders. I have taken some action, which I hope will bear fruit and achieve some simplification. I think that that is all I can say now about this subject.