Employment Rights Bill

Baroness Bennett of Manor Castle Excerpts

Committee stage
Tuesday 24th June 2025 Lords Chamber

Moved by

[Baroness Bennett of Manor Castle]

320: After Clause 150, insert the following new Clause—
“Maximum pay ratio(1) A worker must be remunerated by their employer at a rate which is not less than one tenth of the remuneration made by the employer to the highest-paid employee.(2) The remuneration referred to in subsection (1) includes—(a) salary or hourly pay;(b) bonuses;(c) employer pension contributions;(d) shares, options, or other entitlements;(e) benefits in kind.(3) If a worker receives remuneration which is less than the entitlement referred to in subsection (1), the worker is taken to be entitled under their contract to be paid, as additional remuneration in respect of the period concerned, the difference between their entitlement and the remuneration actually received.”Member’s explanatory statement
This amendment would implement a maximum ratio of 10:1 between the highest- and lowest-paid employees in an organisation.

--- Later in debate ---

[Baroness Bennett of Manor Castle (GP)]

My Lords, my Amendment 320 sits in glorious lone splendour in this group. I am not responsible for degrouping it; that was the way it was arranged. Noble Lords will see that this is a proposed new clause to introduce a maximum pay ratio. I thank the Public Bill Office for assisting me with the drafting.

The noble Lord, Lord Sharpe, took us into celebrity land with Usain Bolt and Mo Farah. I am going further into that space with a forthcoming event from this week: the wedding of Jeff Bezos and Lauren Sánchez in Venice. I am relying here on the interesting reporting in the Guardian from Zoe Williams, who has been spending time with the campaign group No Space for Bezos and finding that in Venice there is considerable resistance to a billionaire taking over a city and totally disrupting the life of that city for three days. Williams quotes one of the local campaigners:

“We really wanted to problematise the ridiculous and obscene wealth that allows a man to rent a city for three days”.


Williams reflects in the article that

“when wealth itself is seen to be acting in its own interests, and it has accumulated to the degree that its impact scars every poorer life with which it comes into contact”,

we have a problem.

This amendment sets out Green Party policy—yes, this is long-time Green Party policy—but I am really aiming to assist the Government constructively here, and to assist the Committee as well as perhaps our national debate, by demonstrating that it is possible to lay down bridges to cross the deep fissures in our society. They are not just in Venice and they do not just involve Amazon—although I note that the Government have been applauding an expansion of Amazon here in the UK. We might think about how many of the small businesses we have just been talking about might go out of business as a result of that. I posit that it is essential to start to bridge these chasms, to tackle the poisonous inequality that so affects our political landscape.

Bringing the context closer to home, noble Lords may perhaps have expected me to cite research out only a week ago from the High Pay Centre, which analysed five years of mandatory pay ratio disclosures across the FTSE 350. This was a previous modest legislative attempt, hoping that shining a light on the level of inequality might have some impact in reducing that inequality. The study clearly showed that the attempt to do that has failed. The figures have basically bobbled around since 2019, and the current ratio of median CEO pay to the median UK employee was 52:1. That has been at a similar level ever since the ratio started to be recorded. I note that it is even worse for the FTSE 100, where the median CEO to median employee pay ratio was 78:1. Those are the middle figures but, if we take the widest measures, we go to the security and catering group Mitie, where 575:1 is the ratio not to the lowest-paid employee but to the median employee. At Tesco it is 431:1. This situation is doing huge damage to our society, and I put it to the Government that they surely have to tackle it.

A 10:1 ratio is Green Party policy. I know from the discussions that the Minister kindly had with me before this debate that she will not leap up and support my amendment, but I hope she may be able to provide some response, at least to acknowledge that we have a problem. The pay differentials also react to the low-pay environment in which those essential to the success of a business are not getting the respect, as well as the pay, that they deserve. Meanwhile, a few at the top are incentivised to chase short-term profits and share price valuation at long-term cost to society but also to the businesses that they head.

The impact on communities is evident in towns and cities, where the vast bulk of workers are now trapped on or very near the minimum wage, while money is shovelled away to faraway company headquarters. Companies defend these sums as reflecting performance, but all too often, as we have seen with the water companies, that is far from the case. Why is it that every worker does not benefit if a company is doing well, as they have all contributed?

I finally note that, yes, this is also an environmental measure. To take just one element of the CEO lifestyle, the wealthiest people in the UK burn through more energy in flying alone than the poorest use in every aspect of their life. Environmentally, as well as socially and politically, we cannot afford a society split between a few have-yachts and the majority have-nots.

[Lord Hunt of Wirral (Con)]

My Lords, I rise to speak to this amendment and, frankly, to express a degree of disbelief that such a proposal should have been made. With due respect to the noble Baroness, I do not believe that this amendment is a serious contribution to the debate on fair pay or responsible corporate governance. It is a piece of performative and ideological showmanship—a throwback to a worldview that sees profit as a vice, wealth as inherently suspect and enterprise as something to be managed, limited or downright punished. The idea that government should impose a legal maximum pay ratio—a flat arbitrary ceiling of 10:1 between the highest-paid and lowest-paid employees in every organisation—is not just unworkable but, I believe, economically illiterate.

First, this proposal would be a gift to bureaucracy and a curse to business. Every company, from high street shops to high-growth tech firms, would have to monitor and police every single form of pay—salary, shares, bonuses, pensions and benefits in kind—just to ensure that they do not cross an artificial line. Do we really want our job creators to spend their time calculating compliance spreadsheets instead of investing, innovating and employing? Secondly, it would actively disincentivise growth and ambition. High-performing individuals—those who drive investment, lead exports and create jobs—would simply leave and take their talent elsewhere.

The noble Baroness mentioned Amazon. I join the Government in welcoming the further investment that Amazon is making. As a matter of record, Amazon employs circa 75,000 people in the UK. No one is on zero hours, and the minimum annual starting salary is between £28,000 and £30,000 a year. It provides flexible working opportunities from day one, including term-time contracts, which allow parents, grandparents or carers guaranteed leave during school holidays. It offers paid parental and bereavement leave. Amazon also offers guaranteed hours from day one, and employees have the choice of full-time or part-time contracts. It is important to put the record straight. Since 2010, Amazon has invested more than £64,000 million in the UK, and £12,000 million in the last 12 months, and supports a network of around 100,000 UK-based small and medium-sized businesses. I welcome the opportunity that the noble Baroness has given me to put the record straight.

To go back to the noble Baroness’s amendment, it would mean that employers would be forced to avoid hiring lower-paid staff altogether, just to protect the ratio. What would be the result? There would be fewer jobs, less opportunity and more outsourcing—the very opposite of what a fair and inclusive economy should look like, hitting the least well-off, the most vulnerable and those at the margins of the labour market.

My third point is that this is not fairness; it is levelling down. It is virtually saying, “Don’t succeed too much, don’t reward excellence, don’t grow too big or too fast or be too profitable”. That is not fairness—it is anti-growth, anti-aspiration and anti-business. I must tell the noble Baroness that this amendment looks like it would be more appropriate in a Maoist economic manifesto, delivered to his revolutionary cadres, rather than a serious proposal for modern employment legislation. What this amendment reveals is not a serious attempt to solve a policy problem but a mindset that is suspicious of success, dismissive of wealth creation and entirely detached from economic reality. Against that background, I look forward to hearing the Minister’s response, which I hope will agree with mine, that this is an amendment that should not be accepted.

--- Later in debate ---

By contrast, the noble Baroness’s amendment would introduce an arbitrary cap on the pay of any individual in a company, regardless of the experience or skills that they bring to the business as a whole. We are not aware of any other advanced economy that has introduced such a measure and have significant concerns that it could undermine the UK’s economic competitiveness. While it is right that companies should explain how pay at the top aligns with wider employee pay, it is also important that companies can compete for the best business talent in the UK and globally. The amendment would significantly undermine the ability of UK companies to attract and retain skilled and experienced employees, while providing international competitors with greater opportunities to poach UK workers, to the detriment of our economy as a whole. For these reasons, I ask the noble Baroness, Lady Bennett of Manor Castle, to withdraw Amendment 320.

[Baroness Bennett of Manor Castle (GP)]

My Lords, this has been a short but very clarifying debate on the political divisions in our society. I will be fairly brief in responding, but there are some points that I must pick up.

The response of the noble Lord, Lord Hunt, really sounded like something from a debate out of the 20th century. I started with the story of what will happen in the coming days in Venice because we are in the 21st century, where raging pay inequality is a huge political issue. If you are not prepared to acknowledge that that is an issue that is significantly shaping our politics, you really are not in the 21st century.

To pick up some specific points the noble Lord made, he said that the amendment would force people to monitor and police. However, as the Minister rightly said, all this monitoring and reporting already happens in FTSE 100 and FTSE 350 companies. It is the law already, so there is no extra paperwork to be done here at all.

The noble Lord, Lord Hunt, said that the amendment would disincentivise ambition, but ambition exists right across the board in companies. We have millions of cleaners, caterers and new apprentices out there who have huge ambition. Their ambition and the contribution they make absolutely need to be recognised.

I have to pick up the Amazon point. The noble Lord, Lord Hunt, missed a couple of things out about Amazon, which I describe as the great parasite. How many jobs has Amazon destroyed? How many ambulances get called to Amazon warehouses, where workers are worked beyond human flesh and blood in trying to keep up with robots? That is the reality of Amazon.

Finally, I come to the point the Minister raised about economic competitiveness and the best business talents. Yes, we need the best talents, but we need them across the board. One person as the leader of the company is a small part of that company. On the idea that this is a pyramid—the noble Lord, Lord Hunt, said these are the people who create jobs—I am sorry, but it is the whole of our society that creates jobs. You can put one of these CEOs on a desert island and they will not make a penny. The infrastructure, the workers and the customers—that is where the wealth comes from, and if we do not have a functioning society then we do not have successful businesses.

However, I am aware of the time and that there are some people in the Chamber who are undoubtedly waiting for next business, so I shall restrain myself from going on further. I shall look to come back with perhaps a more moderate amendment, but I will seek to hear from the Government what they plan to do about pay inequality, because I am afraid that I did not hear in the Minister’s response any answer to what they plan to do about that raging problem. I beg leave to withdraw the amendment.

Amendment 320 withdrawn.

Moved by

[Baroness Bennett of Manor Castle]

321: After Clause 150, insert the following new Clause—
“Review of safe homeward transport for workers(1) Within six months of the day on which this Act is passed, the Secretary of State must publish a review of whether workers should be entitled to access to safe homeward transport.(2) The review under subsection (1) must include—(a) an analysis of transport options generally available to workers who finish work after 11pm;(b) an analysis of the costs, in absolute terms and as a percentage of pay, to such workers of taking the available transport options;(c) best practice examples of employers who provide homeward transport for workers;(d) proposals to ensure that workers can travel home safely after 11pm without excessive cost.”Member's explanatory statement
This amendment would require the Government to review the safety and affordability of workers travelling home after 11pm, and make recommendations. It includes reviewing best practice, such as City firms who pay for homeward transport for workers late at night.

[Baroness Bennett of Manor Castle (GP)]

My Lords, this amendment would require the Government to review the safety and affordability of workers travelling home after 11 pm and to make recommendations, including reviewing best practice. I note that some City firms already pay for workers to travel home.

This is based on work being done by the Scottish Trades Union Congress and the “Safe Home” worker-led initiative launched in 2018 by the Better Than Zero campaign and supported by Unite the Union and the Bakers, Food and Allied Workers Union. It was launched following a women in leadership course in which workers from the hospitality, fast food and retail sectors shared their frightening experiences of getting home after a late shift. They included sexual assault, verbal harassment, violence and stalking.

Large numbers of workers in these sectors are not able to get home safely. Your Lordships’ House is very well aware of how limited late-night public transport can be—perhaps more than we would like to be. We currently have nearly 9 million night-time workers, of whom 15% are in low-paid roles, compared to 10% of employees as a whole. When you take into account restaurants, pubs and entertainment activities, that rises to 38%. Low-paid workers, many of them female, finish work at 11 pm, midnight or 1 am. How do they get home? This is a modest and constructive amendment which seeks to say that, if you are working hours during which society does not provide the transport to get you home safely, your employer has the responsibility to do so. I beg to move.

--- Later in debate ---

[Lord Katz (Lab)]

My Lords, I thank the noble Baroness, Lady Bennett of Manor Castle, for tabling Amendment 321. We recognise the concern underpinning the amendment and agree that workers finishing late at night should be able to travel home safely and affordably. We are aware that for some workers, particularly those in hospitality, healthcare and security, late shifts can pose challenges when public transport options are limited. We also acknowledge and welcome that some employers, including firms in the City of London, have taken proactive steps to support their staff with safe transport home.

While we do not believe that it is appropriate to legislate for a review at this time, I hope I can reassure your Lordships’ House that we are committed to supporting workers’ well-being and safety. That commitment is evident throughout the Bill. For example, as we discussed on the second day of Committee in early May—another opportunity for a history lesson, it seems so long ago—the Bill strengthens the right to request flexible working from day one of employment. This flexible working provision empowers workers and employers to agree working patterns that better suit individual circumstances, including, where appropriate and reasonable, avoiding late finishes. We are also taking steps to improve enforcement of existing rights and to ensure that employers meet their obligations to provide safe working conditions.

Although it is not the subject of this legislation, the Government are also committed to reviving, rejuvenating and investing in public transport, not least through the Bus Services (No. 2) Bill, the creation of GBR, improvements to rail services and the huge amounts being invested across the country, particularly in the north, in new transport projects, all of which will provide a greater level of options and service for not just people working late but those who want to enjoy the night-time economy and to use public transport more generally.

While we cannot support this amendment, we share the underlying concern and will continue to work to ensure that all workers are protected and supported. I therefore ask the noble Baroness, Lady Bennett, to withdraw her Amendment 321.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I thank those who have participated in this brief debate. I am glad that the noble Lord, Lord Sharpe of Epsom, and I can agree that there is an issue here and I thank the Minister for his response. I do not think that offering flexible working will really work with a pub or restaurant—that option will not be available. On public transport, for the workers affected, overwhelmingly we are talking not about grand infrastructure projects but local buses, which have been massively decimated over the last decade. None the less, the point has been made and I beg leave to withdraw the amendment.

Amendment 321 withdrawn.