Sharon Hodgson – 2014 Parliamentary Question to the Department for Business, Innovation and Skills

The below Parliamentary question was asked by Sharon Hodgson on 2014-06-10.

To ask the Secretary of State for Business, Innovation and Skills, what estimate he has made of the ethnic breakdown of workers earning between the National Minimum Wage and the Living Wage.

Jenny Willott

The Government supports a living wage and encourages businesses to pay it when it is affordable and not at the expense of jobs. However, decisions on what wages to set, above the national minimum wage, are for employers and workers.

The Government has not estimated the breakdown of workers earning between the National Minimum Wage and the Living Wage by ethnicity.

The Government’s main policy lever in addressing low pay is the National Minimum Wage (NMW). Using the Labour Force Survey, in 2013, 8.3% of the ‘ethnic minority’ group (see footnote) were in jobs that paid at or below the NMW while overall 7.8% of the jobs in the economy paid at or below the NMW. This is as set out in the Low Pay Commission’s 2014 Report, Figure 2.6.

We are absolutely clear that anyone from whatever background who is entitled to be paid the minimum wage should receive it. HMRC investigates every complaint made through the free and confidential Pay and Work Rights Helpline. Since 1 October 2013, employers who fail to pay the National Minimum Wage (NMW) will be publicly named and shamed under revamped criteria announced in August 2013 to make it easier to clamp down on rogue businesses. This is on top of financial penalties which employers already face if they fail to pay NMW.

Footnote:

The definition of ‘ethnic-minority’ group is as defined in the Labour Force Survey (LFS)

Also please note that the LFS overstates the number of Minimum Wage jobs and workers when compared to the Annual Survey of Hours and Earnings (ASHE) dataset.