According to Prescott the Bill will "effectively scrap the minimum wage." Meanwhile, Alex Ross on LabourList says it allows "employers to opt-out of the Minimum Wage.... effectively abolishing it".
Errr, I've read the Bill and it is about providing an opt-out for employees not employers. It's pretty clear from the Bill, which is tiny, that it gives individuals the right to work for less than the minimum wage if they want to, and gives that person the right to withdraw from the opt-out by writing to their employer with three-months notice.
The Employer, as far as the Bill goes, is still required to pay the minimum wage in those circumstances, so it doesn't abolish the minimum wage, nor does it give an opt-out for employers from it. What it actually means is that someone is legally entitled to the minimum wage but can, if they want, work for less, whilst the employer remains obliged to pay them the minimum wage if they change their mind.
There is even protection for those who are unemployed and seeking a job whereby there is no detriment to national insurance entitlements, nor are they required to take a job for less than minimum wage in order to keep said entitlements . Here is the very short Bill.
National minimum wage opt outWhat's important here is to remember the circumstances that this Bill has appeared in. We're in the deepest recession for more than a generation. Small businesses are struggling with the potential of foreclosure. The first place any small business looks is headcount, but in many cases this is a Catch 22. Lose heads and you cannot service the business you have.
(1) Any person who would otherwise qualify for entitlement to the national minimum wage, as defined in the National Minimum Wage Act 1998 (c. 39), may elect to opt out from such entitlement.
(2) Any election to opt out under subsection (5) must be made by an employee in writing to that person’s employer and signed by the employee and employer.
(3) Any person who has elected to opt out of entitlement to the national minimum wage in accordance with subsection (6) may withdraw such election by giving notice to his employer in writing.
(4) Any notice of withdrawal under subsection (7) shall take effect no earlier than three months from the date that it is given unless such period of minimum notice is waived by the employer.
(5) For the avoidance of doubt, nothing in this Act shall require a person to take employment below the minimum wage and no person shall suffer any detriment to their entitlement to national insurance benefits by reason of their unwillingness to take employment below the minimum wage.
The ability for employees to freely decide to take less than minimum wage has the potential to keep small businesses afloat, and even then, with this Bill, the employees can choose not to opt-out and the employer cannot force them too - admittedly they might then go under and the staff lose they're jobs end up on the dole.
Of course, such rational and calm analysis doesn't chime quite so well with the likes of Prescott, as hysterically standing up and sceaming that the Bill will give employers the right to pay people 50p per hour, or that it abolishes the minimum wage. To be fair such hysteria is at best evidence of reading comprehension issues, or worst disingenuous bullshitting.
The opt-out in this Bill is no different to the opt-out we all individually have on the matter of the Working Time Directive. The question you have to ask yourself is, do you want to live in a country that allows you to choose when, where and for how much you work, with the added protection of knowing you can legally force your employer to pay you the minimum wage? Or not?
Perhaps, if Prescott was a serious politician rather than a hysterical rhetorician, he might propose something more constructive that "Stop the Tory Bill". Perhaps a sunset clause that automagically repealed it when the current recession is over?
Don't misintepret me here, I'd be happy for this to become law permanently because it simple doesn't cause the abolishen of minimum wage at all or confer rights on employers as Prescott is arguing. However, if Prescott wants to see himself as serious, he ougt to think about why, especially right now, such a facility of choice to individual employees might in fact be quite useful.
The Tories opposed the minimum wage on the grounds that it would destory business. During the boom it has not. They were forced to "suck it and see" and they sucked and saw. It didn't do what they thought it would. Likewise now, Prescott should think about the bust we're in and suck this and see and perhaps drop the ideological class warefare purity bollocks.
A Bill like this, at a time like this, could well save jobs because it could actually save many businesses. who would otherwsie have to lay off staff completely and close. Would we rather have people on the dole, or people choosing to work for less in the jobs they already have, safe in the knowledge that they can turn around and demand minimum wage from an employer who can do nothing about it? It would not even have to be permanent if a calmer response to it was taken.
Note: No doubt this post will be commented about as proof of the "nasty party" being alive and well. The fact that the campaign claiming it abolishes minimum wage is wrong will be ignored. C'est la vie
Note II: Before anyone suggests I have no idea what its like to be on low pay, I worked in a supermarket for eight years and lived in a crap flat on a run-down estate, eating value food products, before I got into IT.
Update: It has been noted in the comments, essentially, that I am maive, and this would be exploited by employers. The problem is, as with the Working Time Directive, if after opting-out you opt back in, the employer cannot legally fire you under this Bill.
They have to pay you minimum wage if that happens. The employer has no choice, the employee does. If the employer then creates some excuse to lay you off within three months, makes life Hell, or "manages you out", you have grounds for wrongful or constructive dismissal. It's not rocket science.