Holly Lynch: End this unfairness for young workers

Behind this surge was a real anger and frustration at the impact of seven years of Conservative rule on young people’s lives. Just taking the period since 2015 we have seen decisions taken to scrap university maintenance grants, remove bursaries for student nurses and exclude young workers from the so called National Living Wage. This comes against a backdrop of rising rents, falling home ownership and stagnating wages.

Politicians of all parties have a responsibility to try and understand and address the grievances expressed by young people. I am introducing a Private Member’s Bill which hopes to do just that by extending the National Living Wage (NLW) to include young workers.

Since last April, under-25s on minimum wage jobs began to earn less per hour than their older colleagues; even those who were performing the same role. A young person who takes their A-Levels at 18 and goes either into training in the workplace or directly into employment, could potentially be in a job for six years before being entitled to the living wage. A new employee could start in the same role, sit at the next desk and be paid the living wage, with six years’ less experience, simply because they are over 25.

Things got worse from this April when the minimum wage rates changed again. I asked the House of Commons Library to produce figures showing the impact of the widening gap between the rate for those under 25 and those above.

They calculate that someone working the average amount of hours on the minimum wage, 26 hours a week, who is paid at the rate for 21-24 year olds (£7.05) would earn £610 less per year
than someone paid the NLW of £7.50 per hour.

This gap is only going to increase further as the NLW increases towards a target of around £9 an hour while the lower young person’s rate increases in line with average earnings.

It is a situation which is almost unique to Britain. In the entire developed word, only Greece has a similar age threshold. France pays the full rate from aged 18 onwards, as does Germany, and even in the more deregulated US there is no age bracket apart from the option to
pay workers under the age of 20 a lower rate for their first few months of employment.

There is also little public support for this policy. Survation polling on this question found that 66 per cent of respondents believed that the same minimum wage rate should apply to under-25s. Even amongst Conservative supporters 55 per cent supported an equal wage for under-25s compared to 35 per cent who did not.

The Conservatives have tried to 
justify this approach with the
argument that it will reduce youth unemployment. When I asked Chris Grayling, then the Leader of the Commons, to explain this policy, he replied that “it is important to do everything we can to incentivise employers to take on young people”.

Yet there are serious flaws with this strategy for helping the young, not least the fact that employers that actively seek to recruit under-25s as a way to cut wage costs risk falling foul of age discrimination legislation.

Any employer interviewing for a role is legally required to choose the best candidate for the position regardless of age. The monetary “incentive” that Chris Grayling, now Transport Secretary, believes will persuade employers to hire younger candidates can only be acted on if the employer discriminates against the older applicants.

Last year I organised a debate on this issue in Parliament and since then have been working with young people to oppose this policy. The starting point for decisions on minimum wage rates should always be the principle of equal pay for equal work.

The election sent a clear message
that MPs need to act to improve the lives of the next generation and I hope to gain cross-party support for my Private Members Bill which will abolish the unfairness built into the National Living Wage.

Holly Lynch is the Labour MP for Halifax.