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Wednesday, 3 June

Call For Employers To Be Made Liable For Supply Chains Abuses

Make Poverty History Banner Outside the TUC Building

The TUC says that unless joint liability is extended to parent employers many supply chain workers will remain at risk of not receiving holiday pay and in the worst instances, not the national minimum wage.

A new report by the Congress estimates that 5 million UK workers cannot enforce their basic rights with their ‘parent company’:

  • 3.3 million are employed through outsourced companies.

  • 615,000 are employed by franchise businesses

  • At least 1 million are employed by recruitment agencies, umbrella companies and personal service companies.

 

Minimum wage

The Low Pay Commission estimates that as many as 580,000 workers do not receive the legal minimum, says the report. However, under the current law, a fast food worker at a McDonalds’ franchise couldn’t bring a claim against McDonalds’ HQ if they were paid less than the national minimum wage.

The same applies for other supply chain workers.

 

Holiday pay

The TUC report reveals that 2 million UK workers missed out on £1.6 billion of holiday pay last year.

However, a hospital cleaner working for an outsourced company in the health service couldn’t bring a claim against an NHS trust if they weren’t given their correct holiday pay.

 

New laws

The TUC wants joint liability laws extended so that workers can bring a claim for unpaid wages and holiday pay against any contractor in the supply chain above them.

This would be similar to countries such as Australia where Fair Work laws extend liability to franchisors.

The TUC’s call comes as the government’s new labour market tsar Sir David Metcalf prepares to publish his first report. TUC General Secretary Frances O’Grady: “This is an issue that affects millions, from fast food workers to people working on building sites.

“Employers have a duty of care to workers in their supply chains. They shouldn't be allowed to wash their hands of their responsibilities. Joint liability must be extended to parent employers. Without it they can shrug their shoulders over minimum wage and holiday pay abuses.

“Our labour enforcement laws urgently need beefing up. We look forward to raising this with Sir David Metcalf.”

Picture: The TUC wants joint liability laws extended so that workers can bring a claim for unpaid wages and holiday pay against any contractor in the supply chain above them.​

Article written by Brian Shillibeer

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