As the London Living Wage rises from £7.85 to £8.30 per hour, many employees in Hackney still find themselves earning less, including some carrying out work for the council.
The London Living Wage, which is set by the London mayor at a level deemed necessary to get by in the capital, rose on 3 May to reflect recent increases in the cost of living.
Hackney council and Tesco are among the local employers who fail to guarantee that all those working for them are paid at least £8.30 per hour.
The council signed up to the London Living Wage to great fanfare in 2005, meaning that all of its directly-employed staff receive at least a higher minimum wage that takes into account higher living costs in London.
However, the Town Hall claims that ‘Best Value’ rules which govern local authority procurement prevent it from requiring that the London Living Wage be paid to subcontracted staff, including cleaners.
Research carried out on behalf of Green Party London Assembly Member Darren Johnson has revealed three London boroughs, Ealing, Lewisham and Tower Hamlets, have managed to get round this issue and have now agreed contracts with suppliers that require the London Living Wage be paid.
Johnson said: “Hackney, like so many other councils in London, are hiding behind legalistic excuses. But the Mayor of London and three other councils in London have shown they don’t hold water. It is disgraceful that they can make claims about fairness while they use these excuses to pay subcontracted workers poverty wages.”
There is also outrage that retailer Tesco is not prepared to ensure that all those who work in its stores are paid the London Living Wage.
Scores of local people recently converged on a Tesco supermarket in Mare Street as part of a citywide campaign by pressure group London Citizens.
About 75 people handed out leaflets informing passers-by about the London Living Wage and called for wages of cleaners to be upped.
And they asked the store manager to send a fax to new Tesco chief executive Philip Clarke requesting a meeting on the issue.
London Citizens claims cleaners who work in Tesco stores – who are employed through a sub-contracted agency – are paid £5.96 per hour, far less than the wage endorsed by Boris Johnson as the minimum people should earn in the capital. A spokeswoman for London Citizens said: “The local community gathered here today to thank Tesco employees for their work and to call on Philip Clarke to pay a living wage to Tesco cleaners. We have been talking to Tesco customers and employees and it is clear that all is not well. Cleaners at Tesco are often paid just over the national minimum wage. That isn’t enough to live decently – the Mayors of Hackney and London say so.”
A spokesman for Tesco said: “People at Tesco are paid more than the equivalent at other companies and that’s rewarded by a lot of hard work and loyalty.”
He confirmed the cleaners were employed by a contractor, adding: “We don’t employ the cleaners…It would be quite wrong of us to tell them [our contractor] what to do.”
The 52nd largest company in the world by revenue, Tesco reported a record jump in profits last month.
The company, which was founded by Hackney market stall holder Jack Cohen in the 1920s, has over 470,000 employees and over 4,880 stores globally.
London Citizens’ first living wage victory was in Hackney. In 2003, after three years of campaigning by the group, Homerton Hospital agreed to pay its subcontracted catering staff the London Living Wage. Best value legislation was introduced in 1999 by the previous government.
According to SERTUC (Southern and Eastern Trades Union Congress), “It’s often reported by council officers and elected members that there’s nothing they can do about putting a living wage threshold in contracts – this is simply not the case. There is no definitive legal opinion on this subject as no case has been brought to court.
“According to Recital 33 of the EU Procurement Directive on Public Services and Utilities, a public sector organisation [such as Hackney Council] can adopt a living wage policy stipulating that quality and good value depend on good employment practices. Under EU rules, contracts can be awarded on the basis of ‘most economically advantageous tender’, not just the lowest price.”