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27/12/2012 - Low Pay Britain Exposed

45% of working people in deeply divided 'Broken Britain' are officially classed as low-earners, European Commission figures revealed last month. British workers took home two-thirds or less of the national median hourly wage in 2010 according to newly released statistics.
 
That leaves levels of low pay in Britain an alarming 27 per cent above the EU average and even further above socially progressive EU states of Sweden, Denmark and Finland, which had the fewest low earners. The statistics also showed shameful evidence that Britain has one of the widest gender pay gaps in the EU.
 
A staggering 28 per cent of women in work were low earners compared with just over 16 per cent of men.
 
TUC general-secretary designate Frances O'Grady said: "These figures are hugely worrying especially at a time when the cost of living is rising and the government is slashing vital benefits for low-income workers. People who earn less spend less which has a huge knock-on effect upon local businesses and regional growth." She called on the government to "get to grips" with wage inequality.
 
The Equal Pay Act was a grand gesture in the dying days of a failing Labour government. Designing legislation that would successfully change the way people behaved was a novelty and its passage was a stitch-up between patriarchal unions and patriarchal employers. A five-year gap before implementation was meant to allow employers to equalise pay. Instead it allowed thousands of jobs to be reassigned to women only, perpetuating the undervaluation of women's work.
 
Fighting cases is tricky, because an individual rather than a trade union or the equalities commission has to bring the case. The process was made worse by job segregation, because it made it near impossible to find a comparator to prove men got more for doing similar work.
 
Where attempts have been made to make the law work better, they've been piecemeal: amendment on amendment, overlaid by EU law to produce something so dense that it's incomprehensible to all but specialist lawyers. Above all, the law is about providing a remedy when it has been broken, not about trying to shape the environment to encourage compliance. And when finally a serious attempt at reform was made, it again came at the end of a Labour government heading for defeat.
 
The Equalities Act 2010 repeats its predecessor's mistakes. Its postdated proposals for pay transparency lie unimplemented and ignored by the coalition.
 
The statistics also revealed that education had a significant influence on how much people earned. Under 12 per cent of people who received a high level of formal education were classified as low-earners. That compares badly to the almost 35 per cent of low-earners who received a low level of formal education.
 
Workers in temporary fixed-term employment were also far more likely to be low-earners compared to those with permanent contracts.

Report from Ian Bell