These stories are not new and whilst nationalities and specific cases of exploitation change, the hotel industry is yet another sector where migrant workers are often isolated, unaware of their rights and lack English language skills.  This can make them easy victims for exploitation. The Newsnight story follows a flurry of reports this year relating to the mistreatment of migrant workers in the UK garment, meat and fruit industries.

Impactt have often found that labour standard issues tend to be more prevalent at sites using agency, temporary and migrant labour.  These issues are complex and cannot be reduced to a matter of blame; sustainable improvement relies on cooperation from all involved.  As a result, Impactt specialises in engaging with workers and acting as an avenue through which practicable improvements for workers can be developed with buy-in from both sites management and customers.   

An exploratory study published last week by the Joseph Rowntree Foundation states that about one in four people in Britain are living below the minimum income standard and this is increasing as unemployment rises.  The Minimum Income Standard (MIS) for Britain is based on the public’s perception of what is deemed to be a “socially acceptable” standard of living.

 According to the latest research a single adult now needs £13,900 a year before tax, and a couple with two children requires a minimum of £27,600 to ensure a livable annual budget.  This is up £500 on the previous year.  You can check your own income against the MIS with their nifty Minimum Income Calculator.

The MIS study demonstrates that a vigorous public and political debate about what constitutes an acceptable level of minimum income is as important as ever.  Furthermore this research can perhaps speak to a wider, international debate on the living wage.

It is widely accepted that it is unethical practice to employ someone but pay them less than they need to live on; and the MIS study helps British society keep sight of what constitutes an acceptable minimum level of income.   The MIS study shows that members of the UK public continue to believe that a minimum standard of living should allow people in Britain not just to survive, but to have “what you need to in order to have the opportunities and choice necessary to participate in society”. 

Across the developing world however and in the production lines of international supply chains millions are being paid wages that are inadequate for a worker to support themselves and their family.  For instance the living wage debate has been argued heatedly in Cambodia where the legal minimum wage in Cambodia is $45 but a living wage has been argued to be closer to $93.   Minimum wages in the global south remain fixed whilst the cost of living increases.

The question remains: how can a living wage be defined and how can a living wage be calculated? 

How a living wage might be defined and quantified has been long debated by many and dismissed by some as too complex an issue.  However the MIS study demonstrates that research in this area can draw valid and meaningful conclusions on what constitutes a locally acceptable level of minimum income. 

As for whose responsibility is it to provide a living wage?  If companies were to bear the true cost of living for all their staff would we then see business success come hand in hand with a company’s ability to increase the sum of its human potential?

The International Labor Organization predict that the economic downturn will lead to 50 million workers being unemployed globally by the end of 2009. This week BMW fell under heavy criticism from union leaders after axing the jobs of 850 agency workers, following on from an additional 300 temporary job cuts last December at its Mini factory.

Reports of BMW giving one hour of notice and agency workers facing a struggle to find alternative employment saw Tony Woodley, joint general secretary of Unite, comment “Sacking an entire shift like this and targeting agency workers who have no rights to redundancy pay, is blatant opportunism on BMW’s part and nothing short of scandalous.”

The case again raises the tension between businesses and trade unions regarding the rights of agency workers. Businesses require a flexible workforce, the ability to terminate positions when faced with falling demand and the necessity of cutting costs to survive. Flexibility also brings benefits to workers who are able to work short or no notice period, have control over their work life and a way of getting a foot in the door.

Yet, in some cases agency workers can be engaged for much longer periods, even years, without being offered a permanent position within the company they already work for. Union leaders have put great pressure on the government to put a stop to the use of agency workers as a reliable, but disposable workforce, by affording them certain employment rights.

In May Impactt commented on a new deal between businesses and trade unions that would give agency and temporary workers employment parity with permanent workers after 12 weeks. However debate has stalled in the EU Parliament due to opposition against the continued use of an opt-out of the Working Time Directive. Impactt continues to support this measure which would prevent companies hiring temporary labour in the long term without giving them the associated benefits that a contract of employment provides.

By Joanna Buckley

The judgement states that workers are entitled to a 20-minute unpaid break when they work over 6 hours, rather than being entitled to a 20-minute break for every 6 hours that they work.

In practice this means a worker who works 12 hours is not entitled to two breaks totalling 40 minutes; they are only entitled to one 20-minute break.

This will be of specific interest to companies who are responsible for assessing compliance with UK law, such as retailers and audit companies.

The effect of the decision is that the maximum total number of working hours in a week is now 76 provided that person has signed an opt-out from the Working Time Regulations.  Agricultural workers are still limited to a maximum of 72 hours per week.

Minimum wage rates for over 21s will rise from £5.52 to £5.73 per hour, whilst the minimum wage for 18 to 22 year olds increases from £4.60 to £4.77, and from £3.40 to £3.53 for those aged 16 and 17.

This latest change represents a total increase of 59% since 1998, compared to a 44% rise in average pay over the same period.  The TUC has stated that more than one million workers will benefit from this rise.

Whilst Impactt applauds the commitment of the government to increase the minimum wage, research indicates that there is still confusion and lack of awareness  amongst small businesses about NMW levels. In addition, workers in particular industries such as hospitality, care and domestic service are often being denied these minimum rates.  A TUC report from December last year indicated that around 150,000 workers were not being paid the legal minimum.  Recent reports of ‘scrooge’ employers also highlighted the widespread use of tips in the restaurant trade to ‘top up’ workers’ wages to NMW levels. 

The minimum wage has undoubtedly benefitted a significant number of low-wage workers in its 10 years of existence.  However, inadequate enforcement of the minimum wage requirements continues to thwart the realisation of the regulation’s full potential.

A campaign launched by The Independent last week aims to highlight the treatment of waiters and waitresses working in some of the biggest name high-street restaurant chains. In an article entitled “Revealed: how the restaurant chains pocket your tips” The Independent exposed a series of unfair practices in the restaurant industry. The article showed how some restaurant workers are not paid their tips in addition to a standard wage; instead, tips given by customers in the belief that they are rewarding good service are used to top up wages to the legal minimum wage. Other restaurant workers receive no tips, and workers in one Covent Garden restaurant in London reported receiving no basic wages at all, and instead are being paid entirely by the tips that they receive. According to the article, the restaurants are simply exploiting a loophole in the law, but the feeling that they are also exploiting their workers is difficult to shake.

Working conditions in the hospitality industry have long been criticised as being below expected standards. In the US, the union UNITE HERE have organised a high profile Hotel Workers Rising campaign aimed at raising the wages of workers throughout the States. In the UK, the TUC recently published findings from the Commission on Vulnerable Employment, which focused on low wage service work. But there has been no specific focus on improving wages or working conditions in the restaurant trade.

An increasing number of workers within the hospitality industry are vulnerable migrant workers. Many work behind the scenes as kitchen attendants, cleaners, pot-washers or night porters. In May this year, the Justice 4 Cleaners campaign in the City of London, successfully raised the issues of wages for cleaners employed by cleaning contractors to work in some of the City of London’s largest and most affluent high-rises. The Independent’s story suggests campaigners may have to broaden their focus from cleaners to all low wage service workers.

In Impactt’s experience, where working conditions are not transparent and there is no pressure to improve, there is widespread non-compliance with expected standards and, in some cases, legal requirements. Many workers in this industry are young workers who are working over the legal maximum for evening or night hours. Migrant workers are particularly susceptible to working excessive hours during the peak season, in order to send remittances home, cover for reduced incomes during the low season, or simply to make ends meet.

Impactt welcomes Trade Union and media attention on the conditions of workers in the hospitality industry. Restaurant-goers should be prompted to ask questions about what their tips are funding, showing their unwillingness to be complicit in the underpayment of waiting staff, and ensuring that restaurants and hotels are held accountable for conditions at the ‘fork face’.  

 The government have this week revealed a new deal between businesses and trade unions which is to give agency and temporary workers employment parity with permanent workers after 12 weeks at work.

The measures should come in to force during the next session of Parliament, provided the government is able to ensure that agency workers are able to opt out of the Working Time Directive. This requires action in Europe to ensure that any EU directive includes the provision of an opt out.

The agreement comes after months of debate in Parliament and between businesses and trade unions in order to thrash out a deal which would prevent workers from being exploited, but also allow UK businesses to benefit from a flexible workforce. The business secretary, John Hutton, claimed that the measures would “give people a fair deal at work without putting their jobs at risk or cutting off a valuable route into employment”. The Confederation of British Industry, which was at the negotiating table with other employers’ groups, described the agreement as the “least worst option”.

In an effort to ensure that agency and temporary workers are still an attractive option for employers, the deal does not provide them with Statutory Sick Pay (SSP) or pension benefits after the 12 week mark. Such workers would have to work as long as permanent workers in order to benefit from full maternity rights, but it is not clear when such workers would be able to claim SSP.

Impactt welcomes this new deal, and hopes that the implementation of the measures will be timely and effective. It remains to be seen how the government will prevent employers from evading the regulations, although the agreement includes ‘anti-avoidance measures’. The risk that labour users will simply dismiss agency workers after 11 weeks and 6 days remains a concern. Perhaps the model of the Gangmasters Licensing Authority could be used to empower the Employment Agencies Inspectorate, in order to license and prosecute employment agencies who breach any new and existing rules, and regulate the conditions of workers when they are working.

The Guardian has speculated that the measures have been forced through a scared and meek Labour government, eager to gain approval from voters who are edging away from them in the polls, in a similar way to the implementation of equal pay legislation whilst Harold Wilson’s government was ‘on the ropes’.

We believe that it is a troubling thing when the rights of workers are only defended by a Labour government during times when they are desperate for political approval.  However, as a pragmatic bunch, we also commend the trade unions for standing their ground and utilising the weakness of the government in order to protect the rights of an under-represented group of workers, which has for many years supported many industries in the UK such as agriculture, hospitality and construction.

Here at Impactt, we believe that the issues facing these workers have been anything but overlooked in the past years. There has been a steady increase in the number of reports of the issues faced by migrant workers in the UK. The British public may rightfully feel bombarded with news reports, articles and commentaries about the suffering of our considerable migrant workforce.

What causes the greatest concern is the number of industries that fall outside of the remit of the increasingly successful Gangmasters Licensing Agency (GLA). Recent BBC productions have shown that migrant workers are not travelling to the UK merely to work in fields and pack houses. The Open University and BBC series ‘Meet the Immigrants‘ illustrates the breadth of industries which utilise the influx of migrant workers; from pizza delivery companies to taxi ranks and hotels; migrant workers are contributing to the UK economy in more ways than just agriculture.

Asked to comment on the murky world of Britain’s low wage migrant workers, Paul Whitehouse, explained how his agency was powerless to stop gangmasters in sectors outside of agriculture, food-processing, fishing and shell-fishing. Mr Whitehouse stated: “I have absolutely no doubt the Government passed this law because it believes it is wrong for people to be exploited…. I cannot see why if you work in one area you should be protected, but not in another.”

This intervention was a contribution to a continuing debate which has been raging over what sectors the Gangmasters Licensing Act should cover. Recently, the TUC General Council called for the Act to cover other industries such as construction, after research by Sheffield University estimated that there are over 10,000 gangmasters in operation in unlicensed sectors of the British economy.

We at Impactt believe that regulation and continued debate about the rights of migrant workers will only serve to increase pressure on those groups capable of changing the lot of vulnerable workers such as migrants and long term agency workers. The media, trade unions, NGOs and social enterprises such as Impactt need to maintain the pressure on stakeholders to ensure that all workers are treated fairly whilst at home, and abroad.

 This comes only two weeks after agency workers’ rights were dealt a blow in the form of a judgement in the Court of Appeal, which confirmed a prior ruling that agency workers cannot claim an employment relationship between worker and labour user, regardless of the amount of time they may have worked in a particular role. 

Gordon Brown’s support of a new Temporary and Agency Workers’ Commission seeks to bring together two parties (the TUC and CBI) that have historically had different views on the provision of rights to temporary and agency workers in the UK.  Both parties have taken radically different stances towards the Temporary and Agency Workers (Equal Treatment) Bill which is due to have its second reading in Parliament later this month.   The Bill, which is sponsored by Andrew Miller MP, seeks to extend the rights of agency workers towards equality with those of permanent employees.  

This appears to be a significant turn around by the Labour government that had blocked the Temporary Agency Work Directive which has been stalled in the EU Parliament since 2002, largely due to the actions of Britain and Ireland. The Directive’s future now looks much rosier thanks to the fact that France takes over the presidency of the EU later this year.  

The TUC has championed the opinion that the labour force should be de-casualised and that all workers should have equal employment rights. The CBI has argued that the blocking of the Directive in the EU was a cause for celebration and that millions of jobs in the UK would have been lost if the Directive had been ‘bullied through Brussels’.  

The step by Brown is said to represent a move away from the ‘Blairite’ policies of the Labour party, and a return to their core values, which include equal treatment. The commission is set to establish a process to identify comparable full time workers and therefore determine what equal pay and conditions would look like for agency workers, and how this might work under any future EU directives. 

However, some MPs and unionists have condemned the move, arguing that it is yet another stalling tactic on the part of the government. They argue that the commission will appear to support the Temporary and Agency Workers (Equal Treatment) Bill, but will actually prevent it becoming law, and will waste time on assessing the current rights of such workers, which have long been known to be inadequate and open to exploitation. Today’s Guardian reports that union leaders fear that the formation of the commission is being pushed forward in order to prevent a likely backbench rebellion on the Bill.  

Impactt has promoted the rights of all workers, including agency and temporary workers, through our work conducting assessments and training.  Much of our work on this issue has focused on mediating towards the provision of permanent jobs for long term agency workers, and ensuring that the reliance on agency labour is kept to a minimum, covering seasonal peaks in production, holidays and sick absences. This practice allows long term agency workers to move into permanent positions with full employment rights, and allows companies to utilise a relatively casual workforce whilst increasing their permanent capacity.   

By adopting a proactive approach to the use of agency labour, workplaces can ensure that they minimise the likelihood of exposure to media campaigns and negative coverage as a result of differential treatment of staff on their site.  Once the commission is established, Impactt encourages all interested parties to submit responses in order to ensure a fully effective process.  We also keenly await reports on the upcoming second reading of the Bill on Friday and believe that the increased attention that the two Parliamentary measures, and the EU Directive, are bringing to the debate will only reinforce the message to employers; and thereby benefit a section of the labour force that has been largely invisible for some time.

More on the Today Website.

This raises some interesting points about the relationship between fair-trade and ethical trade. Impactt have been concerned for some time that whilst fair-trade guarantee a better price for farmers, it does not necessarily mean labour conditions through out the supply chain are upheld.

The packing plant may have been considered low risk by retailers – it was UK-based and supplying fair-trade, however this is no guarantee that labour standards will be ok. The UK like many other countries is a destination for migrant workers. And as Impactt’s experience the temporary labour working group demonstrated, migrant workers are vulnerable to abuse as they are completely dependent on one employer: the farm or labour provider that hired them.

Retailers and fair-trade organisations need to be aware of the issues relating to labour standards as well as the issues relating to terms of trade. Whilst these are certainly connected one does not guarantee the other.