Unite is ramping up the pressure on the chancellor to throw a lifeline to the 5m self-employed and other gig and freelance workers whom the government has so far failed to support amid the Covid-19 pandemic.
On Friday (March 20) chancellor Rishi Sunak announced an unprecedented financial support package where the government has agreed to pay 80 per cent of employees’ wages, up to £2500 a month, if they are forced to stop working because of the epidemic as part of an “employee retention scheme”.
While Unite welcomed the move, the union highlighted the many millions of workers – about 15 per cent of the total workforce — who, because they are self-employed, sole traders, or otherwise not in traditional or secure employment, will be left out by these measures.
At present, self-employed people who must stop work because of the coronavirus pandemic – whether because they fall ill or must follow government guidelines on self-isolation – have only recourse to the benefits system.
On Friday, Sunak said he would raise Universal Credit payments to the rate of Statutory Sick Pay (SSP), but Unite has noted that – at just £94.25 a week – this is still far too low for families to make ends meet.
Unite has highlighted what this will mean in particular for the construction sector, where self-employment is standard.
About a million construction workers — half of the entire industry — are paid through the Construction Industry Scheme (CIS), which means they are generally considered self-employed. The vast majority are bogusly self-employed, meaning they do regular work for a company but to save money on national insurance contributions, holiday pay and other obligations, the company will only hire them on a self-employed basis.
A further 300,000 workers are employed via shady umbrella companies, which forces workers to pay both employers’ and their own national insurance contributions, and other fees deducted by the company for processing their pay.
Under this payment structure, construction workers lose out on, in some cases, thousands of pounds a year — and now, amid the coronavirus crisis, they could lose their entire livelihoods without any support if the government fails to step in and help.
Unite assistant general secretary Gail Cartmail warned that the UK’s bricklayers, carpenters, electricians and plumbers “will be deeply worried that if they are officially self-employed they will not be protected by the government’s scheme”.
“Most construction workers are the primary breadwinners in their family and swift action is needed to ensure that they are protected throughout the coronavirus crisis,” she pointed out.
“In the short term the million plus workers paid via the Construction Industry Scheme (CIS) and the 300,000 plus workers paid through umbrella companies must be brought into the scope of the government’s wage support scheme and Unite will be lobbying government to ensure that occurs.
“In the long term a commission is needed into construction employment to ensure that workers who survive on a feast and famine existence secure proper employment protections,” she added.
Extend support to all
In response to a Treasury Committee call for evidence, Unite has outlined a number of key demands, among them an urgent rise in the level of SSP to at least a real living wage.
The union has also called for an urgent increase in benefit levels, both for Employment Support Allowance and Universal Credit standard allowances, in conjunction with an increase in SSP.
All related child and housing elements must also be increased, alongside other adjustments within the benefit system that can act to increase income received from benefits. This must include ending the two-child limit and the five week wait for Universal Credit payments.
Above all, Unite has said that no one should be excluded from financial support measures now extended to employees just because they work for themselves, are on zero-hours contracts or are surviving on very low incomes with the support of benefits. Their earnings must be protected, too.
Otherwise, Unite has warned, people will not be financially able to follow vital government advice to stem a pandemic that is claiming lives at an exponential rate. And without such levels of support for all workers, an already fragile economy not fully recovered from the previous financial crash — and one that has taken a severe hit in recent weeks — will continue to deteriorate into a full-blown crisis.
Welcoming the chancellor’s employee retention scheme, where 80 per cent of employees’ wages will be covered by the government if they must stop work, Unite assistant general secretary Steve Turner said this must be extended to all.
“With pay protection now secured for employees we move onto fair pay protection for all — those sick, isolating or caring for others and the self-employed, alongside the reinstatement of those already on forced lay-off,” he said. “Only strong unions can do this.”
Unite general secretary Len McCluskey agreed.
“It’s vital that no worker is left behind by the government’s wage support measures,” he said.”This union fought hard for those announced last week by the Chancellor but we are not stopping there. The five million or so insecure in our workforce still have bills to pay and families to feed. They need help too – and it cannot be at the pitifully low levels offered by the benefit system. The real cost of living has to be recognised by government in any measures it brings forward – and it has to bring forward these measures soon.”
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