Nick Smith MP has backed a bill that would see top companies forced to come clean if they don’t pay a fair wage to their workers.
The Blaenau Gwent MP was a sponsor on the Living Wage (Reporting) 10 minute rule bill, which would require listed companies to report annually on the percentage of their staff paid below a Living Wage.
The Living Wage, which talks about how much is needed to provide a basic quality of life, currently stand at £7.85 an hour in the UK.
However, 4.9m working people in the country are paid below this much-needed amount – 20% of the workforce.
Speaking after the Bill was agreed in Parliament and will now get a second reading in March, Mr Smith said it was about introducing fairness to the system.
“The economic recovery might mean business at the top is booming, but it just hasn’t trickled down to all the people who helped to get in back there with their hard work”, he said.
“We’ve got a system where the taxpayer is propping up hard workers with tax credits and in-work housing benefit. It’s fantastic that we are able to help those who still need support and rightfully so, but shouldn’t work pay?”
Listed companies are already required to produce annual remuneration reports, but these are focused on the pay of Directors.
The Living Wage (Reporting) Bill would be a company-wide report in comparison generated by the companies.
Only 18 of the current top 100 FTSE companies pay a living wage, and Mr Smith said this concentration of wealth was an example of the system not benefitting everyone.
“People are told if they work hard and do well for their company, they will be rewarded for their diligence”, he said.
“Yet most of the top companies would rather squeeze their lowest paid staff. It’s short-term thinking of profit over people and in the long run hurts us all.”