Union leaders push for higher minimum wage

After more than a decade of agonising, the high command of the trade union movement yesterday decided that it would demand a national minimum wage of `somewhat more than pounds 4 an hour'. Barrie Clement, Labour Editor, discloses the contents of the first significant `bid' set to go before the Low Pay Commission.

With days to go before the Labour Party conference, ministers were yesterday urged by union leaders to set the national minimum wage at least 50p an hour higher than they envisage. Members of the TUC's executive committee yesterday approved a confidential paper calling for a rate of more than pounds 4 an hour.

The paper, which will go before the TUC's ruling general council, urges an "incremental approach to the elimination of low pay", which suggests the initial rate should only be a starting point and it should increase in relative and absolute terms over time. The TUC is due to give oral evidence on 14 October to the Low Pay Commission, set up by the Government to advise on the rate. It assumes the minimum will be introduced late next year or early 1999.

An amendment to go before next week's party conference in Brighton calling for pounds 4.42 an hour is likely to be air-brushed from the agenda by a leadership anxious to avoid being tied to any figure. The decision by the TUC is therefore potentially embarrassing for Labour leaders.

Yesterday, senior union leaders expressed their disapproval of a draft prepared by Congress House officials calling for a wage set at "around pounds 4 an hour" and insisted that it be inflated to "somewhat more than pounds 4 an hour". The change was made in deference to some powerful affiliates, such as public-service union Unison, which are calling for a rate set at half male median earnings calculated at pounds 4.42.

The TUC asserts that a pounds 4 minimum would save pounds 380m in state benefits paid to those in work. Over the last two years the pounds 4 figure has been a target for unions in negotiations with employers.

There should be "a generally accepted notion of what constitutes a fair wage", the paper argues and commends the half male median earnings formula. It accepts, however, that it can be calculated to produce a figure of pounds 3.65, pounds 3.95 or pounds 4.42 an hour. The paper considers that the rate should apply to earnings and not to basic wages to take into account piece-work pay.

The paper is silent on whether there should be a lower rate for trainees or for younger workers, although the Low Pay Commission has been asked by ministers to consider the matter. It says the minimum should apply to "all workers no matter what their status may be".