The pay divide and where worlds collide

 “It’s not possible for anyone to become rich without cheating other people.”
― Robert Tressell, The Ragged Trousered Philanthropists

Working in a Local Development Company I have over the years come across many service users working for minimum wage, some for up to 10 years in businesses where the owners are making substantial profits. Whether or not you fully agree with Tressells overall premise, what is that if not cheating?

One of the few positives of the pandemic is that it has highlighted the difficult and valuable work undertaken by workers who are often subject to low pay and poor conditions

This has been acknowledged by the Tánaiste “The pandemic has caused us to redefine frontline or essential workers and to reconsider the value we place on their work and the reward they should get for that work”. (Leo Varadker Irish times April).

When the Tánaiste gets served in a restaurant or a shop for example there is a collision of two different worlds of employment. One which is well rewarded, good conditions, autonomy, respect, another where someone is also in employment but where many of these are often absent.

The quality of employment is a major and often unspoken divide in Ireland. Ireland has the third highest prevalence of low pay in Europe. In total, some 23% of all employees in the wholesale and retail sector and 39% of all employees in the hospitality sector are low-paid workers (OECD 2020) .According to social justice Ireland 100,000 workers are living in poverty (SJI March 20 20).The acceptance of low pay in Ireland is a huge injustice to many workers and a big contributor to our high rates of relative poverty and other social issues such as food & digital, poverty, educational disadvantage and heath inequality. That it took a pandemic to get real recognition on this topic illustrates a historical acceptance of the situation. This has been helped by the propagation of a number myths surrounding low paid poor quality employment such as the following:

Myth 1: Affordability -Businesses cannot afford to pay higher wages.

While it is arguable that small nascent business may have difficulty in increasing low wages until they become established, many profitable business such as hotel or retail chains are paying minimum wages over years with little or no increases. There is also an argument that if a business cannot sustain decent wages, it is not a sustainable business. Lack of wealth is not the issue but its distribution, in fact the wealth in the country is increasing and the gap between the top 10 % and bottom 10% is growing .This status quo is being underpinned by the intergenerational transfer of wealth which continues to increase with only 10 % of the lowest decile receiving a “substantial inheritance and 67% of the highest earners receiving an inheritance. (Household and Financial Survey 2018 CSO)

Myth 2: Economic shocks are valid reasons for not increasing low pay e.g.: Covid Brexit, recession and… whatever you’re having yourself

One person who hadn’t received a pay rise in 10 years described his conversations over the years with his employer which went something like this, “the current situation with Covid has lost us so much business we obviously cannot afford pay rises”. Although this employer continued to get government subsidy for employees while now back at near full capacity, you might say fair enough he has a point, a lot of trade was lost during Covid. But what about before Covid ?” Well, he was told at the time, there is a worry that Brexit will add to further costs so we will need to see how that turns out”. Sounds reasonable?! Maybe …. What about before Brexit? Back then he was told  “we are just coming out of recession it will be a while before we get back to where we were ,its early days”. So what about before the emergence from recession “well come on there is a recession!” In other words, there will always be something !

Myth 3: Value & Meritocracy

The point about value mentioned by the Tánaiste is a useful point of discussion. Clearly some jobs are valued as worth less in monetary terms than others. There is a reasonable argument to be made that this is necessary as certain jobs require more skills, knowledge, investment in education, and are more stressful etc. The question perhaps then is how much more valued should some jobs be then others and does every worker deserve to make enough money to be able to live without fear of poverty? How much more should a business owner receive than the lowest paid in the business, 10 20, 30 times? ,a lecturer in a college than a cleaner, or a TD and bus driver 4 or 5 times? .

Assessing which jobs merits which rewards is not easy,but If you hear someone say “I made my own wealth with no help or handouts “as an entrepreneur I provide jobs or “I work hard and have a lot of responsibility” this deserves further scrutiny .Very few people make their fortune without some support such as government grants, services, inheritance, or would have a successful business without staff. People work hard in all sorts of jobs and arguably in lower paid jobs often put up with more stress. In fact living on minimum wage shows entrepreneurship to survive.

Myth 4: It’s all about money?

Yes low wages need to increase and nice words will not be enough. In fact the service user that I refer to had recently received a promotion! however it isn’t all about money .An array of human resources theorists such as Herzberg have shown that the presence of factors such as autonomy, and recognition in the workplace act as motivators, while the absence of things such as , equality in the workplace, being spoken to in a reasonable manner, job security, sick pay, are all de-motivators. Bad working conditions often follow poor pay and there are employments where the way people are treated are worlds apart when compared to jobs where these issues would not be tolerated .Recent research by NUI suggests for example that the hospitality is one sector that has issues in this regard, (Inside out a study of working conditions in the hospitality sector NUI June 2021).

There is a tide in the affairs of ………..the low paid

It has been a long time since the national zeitgeist was more conducive to achieving progress on this issue. From a policy perspective there is some positive soundings with Minister for Business, and Tánaiste, Leo Varadkar, suggesting bringing in the living wage, which potentially could see an increase in weekly take-home pay for employees from €10.10 an hour to a proposed €12.30, which would be a positive step.

However those who make policy decisions often have little real understanding of what it is like to work in low paid employment and for sustainable progress workers need to be involved in these decisions .If only there was a mechanism for doing this ?! While imperfect unions are the best way for low paid workers to improve their wages and conditions. The fact that many private sector companies do not recognise unions needs to be tackled. Union membership overall has fallen and relative to other EU counties Ireland has a low percentage of workers involved in collective bargaining arrangements.

Those of us not on low pay are naturally self-interested salary earners, but also citizens and voters need to cease ignoring the fact that we receive services from people daily whose relative wages and conditions suggest they are often held in contempt not just by employers and policy makers but by society as a whole, whether wilfully or otherwise it doesn’t really matter, the pandemic has shifted opinion here and therefore now is an opportune time for solidarity and action.

At local level as the community sector we work to combat disadvantage, part of this is supporting people into employment and sometimes employment where the quality is questionable .Rather than being passive actors here we need to look at educating people about the jobs available, ensuring that they know their rights and promoting quality ,ethical employment where possible. In NEWKD where I work ,we have started to do this in a modest way with “Moving on” a women’s employment project whereby we have introduced participants to a variety of employers through talks with an emphasis on sustainable jobs and quality jobs .Clearly access to these jobs is dependent on education and other factors and therefore there will always be people who will go into jobs which are lower paid. However there should be no such thing as a low quality job, or a job which doesn’t pay enough to cover the basics with some degree of comfort.

Written by Robert Carey. Robert Carey has over 20 years’ experience in developing and implementing strategies and plans which promote social inclusion. His areas of expertise include, equality and anti-poverty work and he has delivered  initiatives in areas ranging from mental health, food and digital poverty to economic inequality and has served on a variety of organisations at local, regional and national level. He writes periodically on social inclusion and equality issues in Changing Ireland Magazine where he is on editorial board. He currently works as a programme manager in Kerry for NEWKD Local Development Company and views expressed here are his own.