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McJobs are giving Britain a reputation as Europe's offshore banana republic

This article is more than 16 years old
Polly Toynbee
Tough inspection to enforce the minimum wage would help to end workforce abuse and illegal immigration

Everyone knows what a McJob is. It is exactly what the Oxford English Dictionary says: "An unstimulating, low-paid job with few prospects, esp one created by the expansion of the service sector." Now McDonald's is trying to get the word removed or re-defined by putting up some patsy MPs to sign an early day motion, and organising a petition and an open letter signed mainly by other service employers and some who have taken the McShilling at some time or another.

Oddly enough, they are not protesting - as perhaps they might - at the rubbishing of their brand name. Instead the McMuffins who have signed the letter claim to be protesting on behalf of the company's 67,000 employees who, they say, are being insulted and demeaned by the derogatory word (though it's not the people but the work and pay that "McJob" traduces). All this is have-a-nice-day newspeak, pretending that changing words changes the reality. Should the OED re-define a McJob as a "challenging, starter-job on the entry-level ladder to success"? The government itself is inclined to mis-describe dead-end jobs as "entry-level".

McDonald's is by no means a worst employer, but nor are such jobs an easy route to the top. Some staff do work their way up to become managers, escaping the minimum wage "crew" jobs that need state subsidies to survive. But do the sums, and the odds aren't good: 67,000 people each year work in the restaurants, and there is a 67% annual staff turnover. About 1,600 have made it from crew into management, earning £28,500 after many years. It may not be as bad as the odds of winning the lottery, but it's not what you'd call fast-track social mobility.

McDonald's have probably made another marketing blunder in reminding everyone of burger-flipping McJobs - but large companies with valuable reputations to lose are rarely the worst employers, so let's leave them out of this from here on. They are just a part of Britain's low-pay culture that sets a minimum wage too low to live on, so hard-working taxpayers subsidise wealthy companies like McDonald's with tax credits for their workers. They are only an example of Britain's class-stratified, low-pay, non-home-owning, low social mobility that causes profound inequality. We will always need caterers, cleaners and carers. What makes these jobs McWork is their shockingly low pay and status relative to others.

The pressing issue is the great unregulated mass of truly bad jobs. Labour keeps praising Britain's "flexible", un-inspected and un-unionised labour market, trying to urge it on the rest of Europe. Neocon economists often claim a large, black economy turbo-powers growth, undercutting pay in the legitimate economy, keeping wages and inflation low. But reputable large companies want bad employers that cheat on pay to be driven out of business as unfair competition.

However, British law allows escape clauses from paying the minimum wage. Last week, another restaurant chain was denounced for paying its waiting staff only £3.75 an hour, which is £1.60 below the minimum wage. Carluccio's wages are topped up out of tips - that's legal: the company says virtually all restaurants do the same, and that at least all their tips go to the staff - and they claim some, like Strada, are worse. (So never add service on a credit card, but pay cash tips after ensuring the waiting staff genuinely keep it as an extra: if not, don't tip).

Enforcement of the minimum wage is minimal, with only 100 compliance officers to cover the country. HM Revenue & Customs have only prosecuted one cheating employer. I requested to go out on a raid against a suspect company, but was refused on the grounds that even if I didn't identify them, employers would have to be warned in advance. How unlike police raids where press and TV cameras are routinely invited to film doors smashed in and arrests of the "presumed innocent".

Most EU countries have vigorous work inspectors: Labour chose a "soft" inspection regime, afraid of CBI charges of adding "regulatory burdens" to the new minimum wage. With £5,000 as the maximum penalty, rogue employers are not deterred. The new gangmasters' licensing law only covers agriculture, deliberately leaving out caring, cleaning, catering and hospitality, where so much illegal work keeps wages low: big brand companies use agencies as cover for their bad employment practices.

Politicians of all parties should demand a tough work inspectorate for another reason: the ease of finding illegal work in Britain is the greatest magnet for illegal immigrants. People come here because they can find no-questions-asked jobs.

There is just one week left before the end of the consultation period on the EU directive to stop agency workers' exploitation, a proposal Britain has strongly opposed. Agency employees can be fired on the spot at any time within one year of employment. Frequently, they are fired just before the year's end - only to be hired again the next day. That way they can work for years for one employer with no holidays, sick pay or pensions. But now that Poland and other east European countries have joined Britain in opposing it, the agency directive will fail.

Next week, the TUC launches a Commission on Vulnerable Employment, with good employers and unions combining to outlaw bad employers. Their YouGov survey of agency workers finds over half have had no holiday break in the past six months. They talk of terrible conditions - 12-hour shifts at sub-zero, freezing vegetables. The TUC is calling for agencies to be regulated and licensed under gangmaster rules.

The latest research ordered by the Low Pay Commission, published in Policy Studies, interviewed workers who had reported cheating employers to Revenue & Customs: most knew nothing of their rights when made to work extra, unpaid hours, with deductions for uniform and live-in accommodation. Many were persecuted for reporting their company, and few received the arrears due after investigators found in their favour. All the research suggests vastly more abuse than is admitted. Newham's Sir Robin Wales speaks for many local authority leaders when he urges work-inspection powers to be given to local councils, which would pursue them with vigour if they could impose and keep heavier fines.

For a glimpse of possible numbers of people illegally working for agencies, consider this: the Labour Force Survey finds only 250,000 agency workers, but the Recruitment and Employment Confederation claims the agencies it represents have 1 million people working for them. So who are the extra 750,000 agency workers, hidden from the official figures? Many are likely to be illegals, utterly vulnerable to every kind of exploitation - and deeply damaging to the legitimate workforce.

All this can be fixed quite easily, if the government wants to. A tough work inspectorate is worth any number of extra border controls. Britain is earning a reputation as Europe's offshore banana republic, both as a tax haven - a playground of global tax-dodgers - and as Europe's third-world, service-sector sweat shop.

Reducing inequality by improving the pay and status of all McJobs will take a long march over a generation, but gross abuses at each end can be fixed - if Labour has the will and the nerve.

polly.toynbee@theguardian.com

Comment is free: A new McDefinition?

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