The scandal of zero-hour contracts and low pay is a widespread problem within the hotel and hospitality industry.
Last month, The Guardian reported that the number of zero-hour contracts in use across the UK increased by approximately 100,000 within the last year.
According to The Office for National Statistics, employment contracts without a minimum number of guaranteed hours rose to 1.8m by November, growing from 1.7m back in 2016.
Depriving people of guaranteed working hours has become standard practice from hoteliers. Regretfully, when I first joined the sector over ten years ago, I conformed to the status quo, and accepted zero-hour contracts as the ‘norm’.
Last year, I heard Shadow Chancellor John McDonnell passionately speak out against the epidemic. McDonnell emphasised:
“The cornerstone of the next Labour government’s programme is to bring an end to the rigged economy that many experience in workplaces across Britain.”
Labour also pledged to ban all zero-hour contracts, halt unpaid internships and furthermore, introduce a “Real Living Wage” of £10 per hour. McDonnell said:
“The scandal of six million people earning less than living wage and four million children growing up in poverty are not inevitable”.
It was Labour’s pledges and John McDonnell’s words that inspired me to make a change within my own company. My understanding was that zero-hour contracts were introduced to create flexibility, giving companies the chance to send staff members home during the quieter periods.
But the problem is, companies could never work their own cashflow in such a way, so why should we expect our employees to do the same? After all, we all have bills to pay.
When it comes to receiving your monthly wages, nobody should have to face the anxiety of an uncertain pay cheque. But sadly, this is the reality for millions across the country, leaving hardworking families with little room to budget or the resources for a healthy work-life balance.
Looking at the hotel and hospitality sector with a fresh perspective, I dropped zero-hour contracts within Signature Living immediately, and I am pleased to say that all our employees are now on fixed contracts.
Labour’s pledges also got me thinking about the experiences of my employees in the workplace, from our hospitality staff to teams at the office headquarters. After taking time to think about the issue, I feel the quicker we pull away from the minimum wage as it is now, and reach a £10.00 per hour figure, the better off we will be.
My finance team is currently looking into raising staff pay across the company to a minimum of £10.00 per hour. Achieving this will certainly serve our economy, bring liquidity to the vast hotel sector and fuel our impoverished retail sector, helping working class people to better their lives and give young people a fairer chance of reaching the property ladder.
To ensure that changes such as this are beneficial to companies, I believe we should also be looking at lowering corporation tax from the average of 22% – this gives the government an average £56 billion pounds per annum. If corporation tax was lowered to the same level proposed by the USA (15%), we would see the weight of the government purse reduced to a much lighter £7 billion pounds.
Consequently, this would ensure that companies based in the UK stay here, and don’t feel the need to jump across the pond or elsewhere in search of lower corporation tax. It will also offer companies a greater confidence in funding minimum wage pay rises.
So, how do we plug the gap created by reducing corporation tax? How could the government really contemplate this?
Well, I believe we can tackle the issue by focusing on large accountancy firms. We need to target firms that are enabling taxable funds to leave our shores for tax-free havens.
It’s as simple as this: if you earn funds in the UK or abroad and you are stationed here, you should be paying your taxes in the UK. HMRC should be given greater powers to ensure that firms cannot create offshore accounts or shell companies that in my eyes, exist to defraud Britain out of money owed to the Treasury.
If we take a stand and end the tax fraud epidemic, companies can reap the benefits of lower corporation tax while employees can enjoy a higher wage, and ultimately, a higher quality of life.
As Jeremy Corbyn said:
“Everybody aspires to an affordable home, a secure job, better living standards, reliable healthcare and a decent pension. My generation took those things for granted, and so should future generations”.
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