HC Deb 23 July 1986 vol 102 cc505-8

Lords amendment: No. 34, in page 41, leave out lines 11 to 19 and insert— 4. — (1) Where at any time during the period of two years ending with the date of an offence under section 16(3) of this Act an order under section 14 of the 1979 Act applied to the worker in relation to whom the offence was committed, or to any other worker employed by that worker's employer, section 16 of this Act shall have effect in relation to any such time as if—

  1. (a) in subsections (4) and (7), any reference to any other failure on the part of the employer to pay an amount of remuneration equal to, or exceeding, the statutory minimum remuneration provided for a worker by an order under section 14 of this Act were a reference to any failure on the part of the employer to pay an amount of remuneration equal to, or exceeding, the remuneration for the time being fixed in relation to a worker by an order under section 14 of the 1979 Act or by a permit under section 16(1) of that Act;
  2. (b) in subsection (5), the reference to the statutory minimum remuneration so provided were a reference to the remuneration so fixed; and
(c) subsection (6) were omitted. (2) For the purposes of subsection (4) and (5) of section 16 of this Act, as they have effect in accordance with subparagraph (1), the following matters, namely—
  1. (a) the question whether an employer has failed to pay an amount of remuneration equal to, or exceeding, that fixed by any such order or permit under the 1979 Act as is mentioned in that sub-paragraph, and
  2. (b) the amount referred to in subsection (5)(b), shall be determined in accordance with sections 17 and 18 of the 1979 Act, and not in accordance with sections (Computation of remuneration) and (Apportionment of remuneration) of this Act."

Mr. Trippier

I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker

With this it will be convenient to consider the following Lords amendments: No 35, in page 41, line 23, leave out from beginning to "and" in line 24 and insert an amount of remuneration less than that fixed by any such order or permit under the 1979 Act as is mentioned in paragraph 4(1) No. 36, in page 42, line 2, after "affect" insert— (a) No. 37, in page 42, line 3, after "(1)" insert— , or (b) any right of a worker to any annnual holidays or to any holiday remuneration in respect of those holidays, No. 38, in page 42, line 10, after second "of" insert ", or in connection with,"

No. 39, in page 42, line 14, at end insert— ( ) Without prejudice to the generality of sub-paragraph (1), an order under this paragraph may make provision in connection with preserving the effect of rights to which paragraph 5(4)(b) above applies. Manuscript amendment to Lords amendment No. 39, in line 4, leave out "(b)".

Mr. Trippier

I wish to concentrate on amendments Nos. 36 to 39 because amendments Nos. 34 and 35 are technical, as I am sure the Opposition will accept. I shall also deal with the manuscript amendment now before the House.

Amendments Nos 36 to 39 relate to the accrued rights of workers to holidays and holiday pay at the date a wages order ceases to apply to them. Wages council workers are not entitled to paid holidays in their first year of service. The rights they accrue in each year are based on length of service and are allowed in the following year. Schedule 6 as at present drafted enables the Secretary of State to make an order preserving such accrued rights as at the date a wages order ceases to apply to a worker. As it would have been impossible to make such an order on the date of Royal Assent and for it to take effect from that date, provision was made for it to have retrospective effect. However, as workers under the age of 21 are to be excluded from the system from Royal Assent, problems are likely to arise in safeguarding their rights through an order made at some future date. The amendments therefore preserve the accrued holiday entitlement for under 21s as at the date of Royal Assent and for other workers as at the date the relevant wages order ceases to apply to them. The existing provision enabling the Secretary of State to make an order has been retained as a safeguard should it prove necessary at some future date to clarify the preserved rights provision.

The manuscript amendment seeks to preserve any other rights of workers under the age of 21 in addition to the accrued holiday entitlement preserved by amendment No. 39. The Government believe that it is necessary to exclude young people from the provisions of wages councils orders from the date of passing of this Bill. Any delay would have to be reckoned in terms of the number of job opportunities lost. We readily accept th4;holiday entitlement earned by service up to the date a wages council order ceases to apply to a worker should be preserved. That is only fair and proper. However, we do not accept that that exception should be extended to any other accrued rights.

Ms. Clare Short

Our manuscript amendment, grouped with these Government amendments, to which we do not object, draws attention to how badly those under the age of 21 are being treated under the Bill. They are to lose all their protection immediately it passes into law. The indecent speed with which the Bill has been brought from the Lords to the Commons means that they will lose that protection before rather than at the end of summer.

It is noteworthy that all other workers protected by existing wages councils orders will continue to be protected by the old orders until new orders are made under the Bill, but the minute the Bill receives Royal Assent those under 21 will cease to have any protection. That is the Bill's final nasty twist of the knife in the young.

The Government's case is based on an enormous falsehood — that a cut in youth wages will lead to a reduction in youth unemployment, and that high youth unemployment is caused by high youth wages. The truth is that youth wages are low by international standards and have fallen massively in the past few years as youth unemployment has grown rapidly. The experience of every developed country shows that when unemployment is rising, it rises faster for young people than for any other age group for obvious reasons: they are marginal to the labour force, they are seeking to join it, they lack experience, and when employers can afford to be fussy about whom they employ, they tend not to employ young people. That is the experience of the United States of America, France and Germany. Youth unemployment has nothing to do with the wages profile of young people in Britain.

The Government's real strategy is to cut everybody's wages. To achieve that, they attack the most vulnerable, seeking to push their rates down, because it is easy to attack women's and young people's wages. If the labour of such vulnerable groups can be made cheaper, they can be made to compete with other groups and used as a lever to push down everybody's wages.

A series of measures, intended to cut the wages of young people has been taken by the Government. They have deliberately used the youth opportunities programme and the youth training scheme to do so. The allowance was set at a low level and it did not operate in line with inflation. If the allowance had kept pace with the original YOP allowance, it would have been about £40. The Government deliberately used the community programme to get the young unemployed, in their desperation, to accept badly paid and part-time employment. The young workers scheme was designed deliberately to cut wages. That unsuccessful scheme has been replicated for an older age group. The cuts in benefits for young workers were intended to make them accept less in order to work.

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One would have thought that any decent Government would wish to protect the young in the first stage of their working life. If one were asked which group of workers needed protection, the young would he the first on the list. They have not worked before, and they do not have experience in looking after themselves and their wages and conditions of work. All decent countries have minimum wages legislation for the protection of young people. Britain is the only country to move away from that. That is why we had to resile from the International Labour Organisation convention on minimum wage protection, with which many underdeveloped countries managed to comply. Britain will not do so.

Such a removal of protection for young people will not create a large number of new jobs. If the cut in youth wages were to have done that, we would have seen a reduction in youth employment because their wages have dropped considerably. It will be a question of getting young people into work by throwing their mothers out of work. The people who work in the industries that are protected by wages councils are overwhelmingly women, and low-paid women.

Unemployment runs in families. If one person in a family is unemployed, it is likely that other members of his family will be unemployed. Young unemployed people are likely to have other unemployed members of their family. In so far as this nasty measure will have any effect at all, a few young people might get jobs, but a number of women, mothers and other young people, are likely to lose their jobs.

Our amendment draws attention to the fact that the only protection the Government will continue to give to young people is to ensure that their accrued holiday pay will be paid to them. Young people are to be treated even worse than other workers who lose protection under the Bill. The existing wages councils orders will continue in force for some time for adult workers, but that is riot so for youth. On the day of Royal Assent, all their protections will be removed.

I have only one pleasure when I contemplate the consequences of the measure. It will take some time for the Government's strategy to work—for employers to shift and cut the wages of young people. By that time, we will have had an election and we will have a new Government who will bring in a proper national minimum wage, with proper protection for young people, so that we can move towards a decently paid, decently trained and decent investment economy instead of the sweatshop economy that the Bill leads us towards.

Mr. Caborn

Of all the hours that the Committee considered the Bill and our previous proceedings, this is the most despicable debate so far. It symbolises the Government's attitude not only to young people but to British industry. Nothing shows more clearly the drive to a low-wage economy than this section of the Bill.

I concur with everything that my hon. Friend the Member for Birmingham, Ladywood (Ms. Short) said. The Government are driving down the wages of the under 21-year-olds simply to ensure that they will displace older workers, instead of training our young people, bringing them on to a decent wage level, and giving them protection. No other Western nation uses young people as fodder so it can have a low-wage economy. They look to young people as an investment for the future in terms of the training that is required by their industries. Anybody would think that Britain's industries have a wealth of trained talent. That is not so. The Bill will worsen that position. I hope that if the Labour party presses the 1-louse to a Division, which I favour, all those Conservative Members who cry out about British industry and its direction will join us in the Lobby.

Question put and agreed to.

Subsequent Lords amendments agreed to.