REC response to Low Pay Britain 2023 report

Responding to the think-tank Resolution Foundation’s Low Pay Britain 2023 report published today, Neil Carberry, Chief Executive of REC, said:

“The success of the minimum wage has always been in trying to find a level which raises pay without major loss of employment. It is right to continue in this vein, especially in the light of rising inflation. But a wage can never be just an income standard, it must address affordability for firms in different sectors and areas, that is why the role of the Low Pay Commission matters. The LPC can both ensure our experimentation is successful and build business and worker support for the standard and compliance with it.

“A particular challenge for all employers, especially government, is making sure that other policies adapt to higher wage rates, including things such as NHS agency worker rates, social care funding and the measurement of hours for salaried staff who are now increasingly caught by the NLW, which works on an hourly-paid basis.”

Neil Carberry added:

“We would support the government looking at reform of Statutory Sick Pay (SSP) and an immediate change to make it work better is reintroducing government support to all businesses for covering SSP costs. This will help to ensure workers get the support they need when sick, without putting the business in jeopardy because it can’t afford the liability around SSP expenses.

“What would ease much of the anxiety about workers on flexible contracts is if Westminster finally got its long-promised Single Enforcement Body going, as suggested in the original Good Work Plan nearly five years ago. This will improve clarity for workers and employers around enforcement and make it easier for non-compliance issues to be addressed quickly and thoroughly.”

Ends

Notes to editors:

Overcoming shortages - How to create a sustainable labour market – July 2022. In this report, we show exactly how much damage could be done if we don’t step up. With a 10% surge in demand for staff across the economy, and the labour market restricted by shortages, we could see a 1.2% fall in expected GDP and productivity by 2027 – costing the economy anywhere between £30 billion and £39 billion every year. This figure is just short of the entire current defence budget, or two whole Elizabeth Lines.

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