Low pay and the living wage

Editorial Introducing Special Issue of Employee Relation

The other margin : do minimum wages cause working hours adjustments for low-wage workers?

This paper estimates the impact of the introduction of the UK minimum wage on the working hours of low-wage employees using difference-in-differences estimators. The estimates using the employer-based New Earnings Surveys indicate that the introduction of the minimum wage reduced the basic hours of low-wage workers by between one and two hours per week. The effects on total paid hours are similar (indicating negligible effects on paid overtime), and lagged effects dominate the smaller and less significant initial effects within this. Estimates using the employee-based Labour Force Surveys are typically less significant

Probing the basis for differential pay practices of younger workers in low paying hospitality firms

Understanding the basis for differential pay practices by age is an important policy issue now that claims for pay discrimination on grounds of age may be mounted. Difficulties in determining the relative job worth and personal worth of workers in particular age groups are highlighted. We identify a need to develop a practical mechanism for assessing the validity of age-related pay differences in keeping with contemporary notions of jobs and skills that will provide a basis for employers to demonstrate objective justification that their employment practices are not discriminatory. More comprehensive and wide-ranging research is necessary to differentiate age-related pay practices and develop further theoretical insights

The new German statutory minimum wage in comparative perspective: Employment effects and other adjustment channels

Germany was one of only seven EU member states without a statutory minimum wage before its new legislation took effect in January 2015. We explore the consequences for wage structure, employment and companies. The new wage floor brought significant increases for low-paid employees, with limited observable negative employment effects thus far. To explain these benign outcomes, we refer to institutionalist and behavioural theories and discuss a number of other adjustment channels for companies. Preliminary evidence suggests that companies in sectors highly affected have responded by reducing working hours and/or increasing work intensity and prices. Some have cut special payments and non-wage benefits, reduced labour turnover and attempted to absorb higher wages by hiring more qualified staff. Non-compliance may also constitute an adjustment channel

The National Minimum Wage and Hours of Work:Implications for Low Paid Women

The largest group of beneficiaries from the introduction of the National Minimum Wage in the UK were women working part-time. A potential threat to these wage gains is a reduction in the working hours available, with part-time (flexible) jobs particularly vulnerable. This paper reports a range of difference-in-difference estimates using individual-level data from the New Earnings Survey and the British Household Panel Survey. No significant changes in hours worked by either full- or part-time women are found 1, 2 and 3 years after the NMW, and no change in the probabilities of remaining in full- or part-time work or transiting between the two