With CPI inflation at 1.1%, and RPI inflation at a negative -1.4%, why is anyone asking for more than, at most, 1.1% increases?

Pay rises are very nice (I like them as well), but a pay rise that goes above simply meeting rising living costs has to be justified by the employee generating the extra revenue for the employer.

Quite simply, work better and get more money. If you aren’t more productive, then why should you get above inflation rate pay rises? How have you earned it?

In essence, what is the purpose of the minimum wage – to ensure people are paid a basic minimum salary, or a political aim to equalise pay regardless of the job done?

Most people will support the former, but many will be wary of the latter.

Increase the minimum wage.

At the very least it would demolish the argument immigrant labour is undercutting low wage earners.

I’m more concerned that the TUC is only recommending a 20p rise in the minimum wage.

Hi Ian,

“With CPI inflation at 1.1%, and RPI inflation at a negative -1.4%, why is anyone asking for more than, at most, 1.1% increases?”

One reason is that inflation levels vary depending on what people’s main expenditure is on, so that the cost of living is rising faster for people on lower incomes than for people on higher incomes.

Research from Joseph Rowntree Foundation suggests that inflation for low paid workers earning less than £14,000/year is actually more like 5%.

http://www.liberalconspiracy.org/2009/07/02/what-should-be-the-minimum-income-standard-in-2009/

Good on the TUC!

Ian Visits,

Suppose the TUC was successful, and got the NMW raised to £6. How on earth would this mean “pay is equalised regardless of the job done”. Someone working a 40 hour week on £6 an hour will get (before tax) ~£12500 per annum. This doesn’t equate to equalising everyone’s pay, does it? Last time I checked, lots of people in the UK earn more than £12500, and if the TUC was successful in increasing the NMW to £6 plenty of people would continue to earn more than £12500. Dragging some of society’s poorest up (a bit) hardly amounts to bringing about some egalitarian utopia, does it.

Take your Tory dogma elswhere.

The TUC are partly missing the point. I agree that a 20p an hour increase is to be welcomed, but the problem with the minimum wage and other employment laws in general is the fact that ‘rogue’ employers can easily circumvent those laws, without too much difficulty. Some of these practices have been highlighted here, tips being deducted from wages, agency working, zero hour contracts, ‘temporary’ workers etc. These people are often the poorest, weakest members of society and more importantly have no way of getting organised and therefore, crucially, have neither advocacy or access to government.

Take the TA for example. The Government announced that they were slashing the training budget and within hours, the lobbying machine was on track and a week later, the cut had been reversed. Bankers, well need I say more? The CBI; on at least one occasion Alistair Darling announced plans in the budget, only for them to be dropped on the ‘advice’ of the CBI.

These people, and many more, have access to the political system and receive sympathetic ears, but who do the dispossessed lobby? Who stands up for the cleaner working as a temp for a powerful agency?

Let us imagine that you are told that your wages have deductions for PPE, and an administration fee for the privilege of having your wages paid into your bank? Not only that, but you are expected to undergo ‘voluntary’ unpaid training for an hour every night? Where do you complain to? And even if you do complain, what rights have you got if you are sacked? What if you know your rights, but you have absolutely no way of enforcing them? In those circumstances, the minimum wage is not really relevant because you are being exploited and losing out because nobody cares enough to investigate those claims or is even interested in your plight. Brown was denying the ten p tax error right up to the point when wage slips were being printed.

“If we want to see a more equal, socially just, environmentally friendly and free society then we can’t just hope for it” – and neither should we be supporting a minimum wage set at a derisory level.

“a pay rise that goes above simply meeting rising living costs has to be justified by the employee generating the extra revenue for the employer” claims Ian Visits.

No, it is justified by reducing the amount of surplus value which the employer extracts from the employee. It is justified by reducing the exploitation of labour by capital.

FYI: http://fr.wikipedia.org/wiki/Fichier:SMIC_EU_2008_euro_%26_PPS.png
A comparison of mwr across Europe.

Interesting that Germany, a country with extremely strong unions, doesn’t yet have a national minimum wage. Also interesting that Britain’s minimum wage is more similar to the one offered in the US – as a percentage of average wages – than to those available in Europe.

The problem with not having an adequate minimum wage – de facto or de jure – in countries with adequate social provision, is that the wage shortfall has to be made up by support payments, encouraging people to work the system.

I,ve just recently found this site,and find it very good.My son and daughter-in-law are both on the minimum wage,I was trying to explain to my son about the tories voting against the NMW,and their comments about “letting it wither and die on the vine” He said what does it all mean,I said put simply son,they are a pack of B*strds