Tuesday, 14 May 2013

Local MPs back Agricultural Wages Board abolition; local farm workers face hard times ahead?

Eric Ollerenshaw
Both local MPs have backed the Government's decision to abolish the Agricultural Wages Board - a decision that will potentially affect the livelihoods of many local farm workers when it ceases operations in October.

In a vote following a recent House of Commons debate, both Eric Ollerenshaw and David Morris voted with the government, rejecting an appeal to reconsider the decision to abolish the last Wages Board, which has set pay levels for 153,000 workers in England and Wales and protected their basic rights since 1948.

David Morris
The abolition of the Board was passed without a vote as an amendment within the Efficiency and Regulatory Reform Bill earlier in April, after a long-running campaign by the National Farmers Union, and a contested four week "consultation" last year which opponents of abolition argue failed to consult many, relying in part on digital responses when many rural areas and workers lack good access to internet services.

Agricultural workers enjoy rights provided by the AWB which have in the past been annually updated through a revised Agricultural Wages Order, including an increased minimum wage rate, a greater holiday entitlement than the 5.6 weeks (for full-time workers) provided under the Working Time Regulations; depending on length of service, an entitlement to a minimum number of days sick leave, a dog allowance; and a birth / adoption grant of £60 per child.

Until now, agricultural workers were not governed by the National Minimum Wage or Working Time Regulations unlike non-agricultural workers. As a result, when agricultural workers are employed they are automatically bound by the minimum conditions set down by the AWB and contained within the annual AWO; there is not a great deal of negotiating power on behalf of the employer.

The principal effect of the abolition will be to eliminate the separate regulatory regime that currently exists in relation to the engagement of agricultural workers, which will allow employers greater freedom to negotiate individual terms and conditions with agricultural workers. The only legal restrictions governing the employment of agricultural workers would be those restrictions that apply to all employees or workers regardless of the sector they work in.

While the AWB’s abolition should save the government about £50,000 a year, according to the Department for Environment, Food and Rural Affairs own impact assessment the cost to workers and the rural economy of abolition could be at least £235 million over the next 10 years.

The abolition has been welcomed by the NFU, the abolition has been condemned by the Welsh Government, who are now working to set up their own AWB, the Labour Party and farm workers union Unite.

Unite argues that abolition could suck £131 million in lost wages, £81 million from annual leave and £4.4 million in sick pay from the rural economy, which would accelerate the slide to a poverty-stricken existence for many workers.

Labour says the abolition will undermine pay security for more than 150,000 people while Shadow business secretary Chuka Umunna argues that in abolishing the Board, the government was "betraying" workers by abolishing the wages regulator.

"We will remind every single voter in those seats of the Conservatives Party's betrayal of them in the next general election," Mr Umunna said.

He claimed Lancaster and Fleetwood and Morecambe and Lunesdale were among constituencies that would be worst affected by the abolition of the AWB, while Labour' s shadow environment secretary Mary Creagh argued that getting rid of it would lead to a "race to the bottom" over wages and in the "under-cutting" of British labourers by foreign workers.

Many arguments to keep the Board

"The abolition of the AWB is wrong on three counts," she argued. "First, it will take money out of workers’ pockets and out of rural high streets at a time when the economy needs it most. The abolition does nothing to reduce the deficit; it could even increase the deficit by adding to the welfare bill, because workers pushed into poverty pay will claim more in-work benefits and lose the incentive to gain new skills. Secondly, the abolition is bad for our food industry. A race to the bottom on pay will not help to attract the new recruits the industry needs.

"Thirdly, the abolition is bad regulatory reform because, paradoxically, it will increase the burden of employment regulation on small farmers, meaning that many more of them could end up in employment tribunals. Ministers’ incompetence will result in lower pay, higher welfare spending and more regulation, and it will deepen the recession in the rural high streets they represent."

Unite Fury

Unite, who are furious at not only the abolition of AWN but the way it was inserted into the EERB in the House of Lords as an ammendment, argues that the demise of the AWB could now prompt a challenge to the European Court of Human Rights, as thousands of agricultural workers face a threat to their homes.

Unite national officer for agriculture Julia Long said: “What we have witnessed is a national disgrace and the capitulation of MPs to the interests of the big employers and the supermarkets, who want to ruthlessly drive down costs.

“There was not even a vote on the amendment by MPs on this vital issue which is a stain on democracy. The spectre of poverty embracing the countryside is now very real.”

It is estimated that there are about 60,000 agricultural workers and managers in accommodation provided by their employer. They could face losing their homes after 1 October, if they left their current employment and had to negotiate a new contract.

Noting that the AWB grade 1 rate was only 2p more than the hourly rate for the National Minimum Wage the unions says the take-up of in-work benefits by those on AWB rates is high, so low pay in agriculture and horticulture is being subsidised through the benefits system.

The union also pointed out that 30 per cent of agricultural employees live in a house owned by their employer and many rural workers lived in communities where their employers were in “positions of social control”, such as JPs, councillors or school governors.

“Agricultural members of Unite have described the inter-woven social and employment fabric of their lives as ‘feudal’.”

Dubious Consultation

Unite also hit out at the membership of the Farming Regulation Task Force that recommended the abolition in May, 2011.

“The task force included no workers’ representatives. Out of the nine members of the ‘independent’ task force, five work directly with supermarkets and their suppliers. There is evidence to suggest that the impetus for this drive to abolish the AWB comes from the horticultural membership of the NFU, responding to the demands of the supermarkets for ever-cheaper fresh produce.”

The union has vowed to fight to restore the AWB and will set up a ‘wages watch’ unit to monitor any assaults on the pay and conditions of its members in the coming months.

MP Tom Watson notes the consultation to abolish the AWB was undertaken using the government’s revised consultation procedures on a tight timescale from 16th October until 12th November 2012. "The new procedures essentially allows the government to consult over one month rather than three," he says. "When they made the changes, the government made all sorts of guarantees that many think have been broken already. There is a Compact between government and the voluntary and community sector over the details of consultations that has not been respected in this case, for example.

"This is particularly relevant because of the omission of a range of significant voluntary organisations from the list of consultees, who may not even have been aware of the consultation before it was over. For example, the National Council for Voluntary Organisations, a key umbrella voluntary sector organisation with a wide range of rural affiliates, was not on the list. Nor was Action with Communities in Rural England.

"The government said that in the modern age, many consultations could be done more quickly online with groups who are innate digital users. Workers in rural areas are a group for whom the government’s ‘digital by default’ principle is wholly inappropriate; in many ways they are the definition of a ‘hard to reach’ group. DEFRA’s website states that 47% of households in sparse hamlets or isolated dwellings have no or slow broadband. Internet access in rural areas is limited because of the government’s historic failure to invest; mobile reception in many rural areas is unreliable. Added to that is the low pay of the agricultural workforce, not all of whom will have access to new technology, partly because of its cost.

"So, the consultation was too quick, failed to consult the right people and ensured that the poorest will carry the heaviest burden. You won’t be surprised to know that I strongly believe this was the intention of Coalition ministers from the outset."

NFU: Board "outdated"

Commenting on the abolition, NFU Deputy President Meurig Raymond said: “The abolition of the Agricultural Wages Board has been a long-standing policy ambition of the NFU and we are pleased that we’re in sight of this goal. Throughout our lobbying effort over the years, the NFU has consistently argued that it is outdated, particularly with the existence of a national minimal wage and working time regulations which apply to all employment.

“AWB abolition is a progressive reform and is a welcome step to freeing up the industry to reward workers appropriately for the valuable work they do on farms," he argued. "At last, we can move on from the one-sized-fits-all approach that puts agriculture out-of-step with the rest of the UK workforce. Free from the order, this creates the opportunity for workers and employers to look more widely at the total employment package; to go beyond the basic hourly rate and consider skills, training, and salaries as negotiations between individual workers and individual businesses become the norm.

“The timeframe for abolition still has to be confirmed, but it is hoped that abolition will coincide with the expiration of the current Agricultural Wages Order at the end of September. For the time being, employers must still comply with the terms of the order, alongside other employment legislation. Employers must be aware that current terms and conditions will remain in place after abolition for existing workers.

“The NFU’s work on employment issues continues. We are committed to providing key indicators and business guidance to help support the agricultural industry as it makes the transition to practices that are standard in every other sector of the economy.”

During the debate, Birmingham MP Jack Dromey noted that it was Winston Churchill who first took action to protect farm workers, as President of the Board of Trade, in 1908. He argued then that we needed fair treatment and to act to keep labour on the land. That was legislated for by the Attlee Government after World War 2 and championed by Harold Macmillan in the 1950s.

Tories: AWB "no longer a necessity"

But Nottingham MP Mark Spencer rejected the Opposition's concerns. "The first argument that we heard from the Opposition — that abolishing the Agricultural Wages Board would not save any money — wholly missed the point of the debate," he said. "This is not about saving cash for the Government; it is about recognising the changing dynamic of agricultural work in the United Kingdom in a modern setting, and recognising the safeguards that have been introduced by other Governments and other parties.

"The minimum wage established a floor for the wages of all workers and has given them wage security, while changes in the legislation governing gangmasters have protected agricultural workers who are employed by them. The Agricultural Wages Board has become redundant. It is no longer a necessity because there are other safeguards, irrespective of the changes in the dynamic of agriculture.

"... Agriculture has moved on," he argued. "The key question is whether the Opposition would overturn the abolition if they were in power. They were challenged on that point several times during the debate and on three occasions they refused the opportunity to answer. There is some cynicism on the Government Benches. Is it a political
game? Is it about making a political point rather than a genuine one about improving the lot of people working in rural communities?"

Wales goes it alone on new AWB?

At the end of April, Welsh government minister Alun Davies unveiled plans today for a separate AWB for Wales, announcing he would launch a consultation over setting up a new AWB in Wales to protect 13,000 low-paid agricultural workers.

"I am determined to protect the industry here in Wales and to explore all available options for retaining a body such as or similar to the AWB," he said.

Unite's Julia Long said the move came in "stark contrast to the retrograde policies of the coalition government in London.

“Abolition of the AWB runs counter to the scientific and political consensus that the UK needs to become more self-sufficient in food production, and central to this aspiration is a skilled, multi-generational and well-paid workforce.”

Web Links

House of Commons debate on the abolition of the AWB, with voting record

• MP Tom Watson draws attention to the failures of the consultation process in a blog post here and publishes the Duchy of Cornmwall's minimal arguments in favour of abolition as an example of its shortcomings

National Farmers Union


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