by frog
You probably saw over the weekend that BP have decided to scrap the youth wage when hiring/paying their employees, and start all their workers on the new adult minimum wage of $10.25.
This is great for the young workers, who – as a BP spokesperson points out in this TV1 story – are often in the same roles with the same responsibilities as their adult co-workers, and who will now be paid the same for the same work.
It’s also great for the ongoing campaign to scrap the youth wage. One of the loudest cries from those opposed to Sue B’s Bill has consistently been that businesses do not want such a change – and yet here is a business implementing the Bill’s desired outcome of their own accord, without a law forcing them to do it. It’s an admirable decision, and BP should be applauded for it. The fact that it has happened prior to the proposed law change just goes to show that much of the opposition to the Bill so far and the arguments about the business world’s position have been largely hot air.
As the folks from the SupersizeMyPay.com campaign have pointed out, this really does lay down the challenge for other youth employers like MacDonald’s, KFC, and Restaurant Brands to do the same.
Submissions are now being sought for the Bill, which has passed its first reading and is due to come before the Transport and Industrial Relations Select Committee. Click here for a guide to submissions.
Published in Economy, Work, & Welfare by frog on Mon, March 13th, 2006
Tags: environment
on the trolls and those who are unable to keep on topic
It’s sad that businesses are putting up the “we can’t afford it” argument against this legislation – it’s because they don’t have the guts to put up the “f*** off, it’s none of your business” argument.
That said, it’s good to see BP paying people the same amount of money for the same work – that’s only fair, and will hopefully benefit them in terms of being able to attract better staff, and more customers.
But the fact remains: no-one has the *right* to dictate to a company the terms under which it hires staff.
Like or Dislike:
0 
0 (0)
Aren’t we lucky, then, that we don’t live in a “liberal” cloudcuckooland?
Like or Dislike:
0 
0 (0)
Yeah, where companies and workers negotiate fair, decent pay between themselves, without the need for Government intervention … like BP.
Like or Dislike:
0 
0 (0)
If a middle-aged joker like me is working alongside a teenager in most jobs, the youngster would probably give better value for money being physically fitter. In 1971 when they were about to bring in equal pay for women, my girlfriend’s employer told all their female employees that they’d have to fire all the women because they couldn’t lift heavy loads, they took more time off sick, and they’d leave to raise families. That threat of course proved to be bullshit. Similarly with abolishing youth rates.
Like or Dislike:
0 
0 (0)
Actually near all youth wage rates occur in domestic service sector areas, so competition on price is not a factor. People have to shop somewhere and others also have to pay full wages.
Though some retail may fast track new pricing tech. And there will be an issue of higher prices for takeaway foods, as compared to self cooked food,resulting in less takeway food sales. But then again those who get paid higher wages become better customers.
Like or Dislike:
0 
0 (0)
You’re all dodging the two fundamental issues: firstly, whose right is it to force companies to pay a certain wage, and secondly, in economic terms the minimum wage actually represents the price under which people are unemployable.
That is, let’s say you set the minimum wage at $10 / hour. That doesn’t change how much a persons labour is worth; what it means is that there is no point for a business to hire anyone worth less than $10 / hour.
If you dispute that the minimum wage legislation actually changes the value of labour, why not make the minimum wage $20 / hour? $50 / hour? $100 / hour?
Like or Dislike:
0 
0 (0)
“whose right is it to force companies to pay a certain wage?” – oh c’mon Duncan, it’s called society. The same meddling do-gooder forces that introduced nasty business-unfriendly legislation like 40hr work-weeks and workplace health and safety standards.
Should repeal those bits of legislation also because they’re onerous and interfere with the sacred right to negotiate the terms of employment directly between employer and employee? Or do you accept that setting minimum standards which everyone is free to exceed has a useful place in a civilised society?
Like or Dislike:
0 
0 (0)
> oh c’mon Duncan, it’s called society
Okay, so why does society have the right to do what individuals may not?
E.g., it’s not right for me to waltz into a business and demand that they set certain conditions of employment. So how is it right for the Government to do that? The Government should only have powers delegated to it by the people, and as I don’t have the right to enforce a minimum wage, neither should the Government.
I guess what I’m asking is: do you consider the morality of an action to depend upon how many people support it? Why do you consider an action moral if the Government does it, but immoral if I do it?
> Or do you accept that setting minimum standards which everyone is free
> to exceed has a useful place in a civilised society?
No, if (as I’m assuming is the case) you’re arguing that those standards be applied, by threat of force, against those who don’t want them.
Anyway, as I’ve argued (& you haven’t disputed) – the economic effect of minimum wage legislation isn’t to set a ‘minimum standard’, it’s to guarantee that people whose labour is worth under the minimum wage are unemployable.
As I said, if the minimum wage legislation *doesn’t* behave as I claim it does, why choose such an arbitrarily low minimum wage? Why *not* $20, $50, or $100 / hour?
Like or Dislike:
0 
0 (0)
You might want to have a read of this:
Repeal the Minimum Wage – http://www.mises.org/story/1991
In particular:
“The rate of unemployment tends to be directly proportional to the excess of labor costs over productivity.”
Like or Dislike:
0 
0 (0)
Silly Greens, sucked in again by a smart piece of PR by the unions and BP.
YOu should be red faced not green.
When will you learn to check the facts. Caltex and Mobil don’t even pay youth rates, Mobil never has and Caltex not for three years, and Shell don’t employ service station staff, says the Dom Post this morning.
So BP gets congratulated for being the last of the oil companies to get rid of youth rates. How progressive….
Like or Dislike:
0 
0 (0)
The Mises report portrays an American perspective, where unemployment has a somewhat different connitation than in the rest of the OECD world, in other words, its realities dont travel well outside the USA boundaries.
What is true is that higher minumum wages do make some businesses uneconomic, as they can only operate by paying their labour force next to nothing.
I say let such businesses go to the wall.
Thats market forces. Either there is enough value there to make the business economic whilst paying decent wages, or theres not. If the business is essential to life as w know it, someone will figure out how to make it more efficient, or how to charge more for the product or service.
Like or Dislike:
0 
0 (0)
a – society has the right, because that’s the way it’s set up. We elect an executive to make laws that everyone is expected to conform to. If you don’t like our parliamentary democracy, you’re free to try change it or move elsewhere. But if you elect to live here, that’s the way it works.
b – in answer to your (perhaps facetious) question: “If you dispute that the minimum wage legislation actually changes the value of labour, why not make the minimum wage $20 / hour? $50 / hour? $100 / hour?” Why is the open road speed limit 100km/h and not 200km/h? Why does it apply to everyone when clearly we’re not all equal drivers? Why does most medicine list a standard dose, when clearly the effects will depend on body weight, gender, health and other factors? Because when you apply pragmatism to most real-world (as opposed to idealogical) questions, a reasonable middle-ground can usually be made to work.
What you consistently fail to address is the reality that wage bargaining *especially* in many minimum-wage situations such as, say, school leaver vs Restaurant Brands management is an extremely unequal power situation. Now you can argue for the primacy of the powerful to do whatever the hell they can get away with (in which case you’ll have plenty of common ground with US foreign policy) but one of the whole points of civilisation is to place some restrictions on the powerful and to protect those open to exploitation.
By and large, individual personal freedoms have been *increased* over time by judicious restrictions placed on the powerful (eg the ending of Dickensian sweatshop conditions in the western world), rather than reduced.
Everyone chafes under society’s restriction to some degree or other (me, it’s the speed limit I hate the most..), but by and large it serves us. I just can’t understand how you can accept the need for law on one hand, but mentally make some sort of exception for labour laws such as minimum wage restrictions, as if they were some sort of exception to the general process.
Like or Dislike:
0 
0 (0)
> a – society has the right, because that’s the way it’s set up.
That argument would apply to any law passed by any system of Government, provided it was set up by the majority of people. You’ve answered how our system works, how it was set up – but *not* whether it’s moral or just.
Perhaps I’ll re-word my question so as not to appear facetious: what level of unemployment do you consider acceptable as a consequence of minimum wage laws, or do you dispute the causality entirely?
Like or Dislike:
0 
0 (0)
dbuckley,
Market forces? I don’t see how you can say that imposed minimum wage has *anything* to do with market forces.
Sure, a business in a free market can fail because it can’t pay its employees enough – in the sense that no-one good enough would work for the wages on offer. But what you’re talking about – failure due to Government interference – has *nothing* to do with a free market, & everything to do with a mixed economy.
Like or Dislike:
0 
0 (0)
Duncan makes a good case of exposing the immorality of the capitalist system. It’s hard to argue a moral case for using the threat of force against those (in this case corporations) who, left to their own devices, would refuse to respect the human needs of those whose time they purchase (and the purchase of parts of their lifetimes is conducted under duress unless they have other options for feeding /clothing/housing themselves). You can argue that it’s a practical necessity at the present time – but that doesn’t make it moral.
There could be a case for dropping all legislation regarding wages and conditions, while also dropping all legislation restricting the right to unionise, strike, etc. Allow workers to organise how they will, appoint representatives as they choose, to support each other in solidarity strikes when they choose to, and otherwise stop government interfering in their exercising of their collective strength.
Probably a recipe for increased confrontation, but I think we’d quickly find out who needs who.
Like or Dislike:
0 
0 (0)
It might be interesting to know whether Caltex and Mobil had negotiated their decision not to use youth rates with a union. If the answer is no, that could mean that young BP workers have missed out on higher wages due to being represented by a union…….
Like or Dislike:
0 
0 (0)
Duncan Bayne, we may as well lve in different worlds.
The ideal minimum wage for employers is $0.00. That, of course is slavery.
Government regulation re the minimum wage is designed to set a balance between the interest of employers to remain profitablem and teh interests of employees to earn enough to maintain themselves and their families without taxpayer funded social assistance.
Neither stakeholder should ever be dominant – the objective is to attain an appropriate balance that both parties can live with.
The ultimate alternative is a class war, and if the workers win, the socialisation of the means of production, distribution and exchange.
Do we really want to go back to that, Duncan. Thought we might have all learned from the collapse of the Soviet Union – there are lessons for those of you on the right, not just those of us on the left.
Like or Dislike:
0 
0 (0)
Insider, no Union supports youth rates. Get real!!!
Like or Dislike:
0 
0 (0)
I dispute the causality of minimum wages leading to higher unemployment.
Like or Dislike:
0 
0 (0)
Greenfrogred
Yes but the question is, did Mobil and Caltex employees achieve elimination of youth rates years earlier without a union? If so, is that actually an indictment of the EPMU’s advocacy, as BP workers might have got there earlier without their ‘help’. It might be argued that the collective agreement may actually have disadvantaged union members by allowing BP to hide behind it and pay below the market value for at least three years (which is when Caltex dumped the rates).
The other question is, why aren’t the media asking such questions rather than just accepting propaganda at face value? Shouldn’t the key question be – BP what took you so long?
Like or Dislike:
0 
0 (0)
> I dispute the causality of minimum wages leading to higher unemployment.
Okay then – on what grounds?
I’m guessing this means that you also dispute my argument that rather than setting a minimum value of labour, minimum wage laws set the minimum value a person’s labour may have in order that employing him becomes worthwhile?
Like or Dislike:
0 
0 (0)
KFC is owned by Restaurant Brands.
Like or Dislike:
0 
0 (0)
jeez fwog $10 not much, it not great fwog,
Like or Dislike:
0 
0 (0)
Behind the times here, but just want to point out that the other brands owned by Restaurant Brands (that is, Pizza Hut and Starbucks) do not pay youth rates either. Nor does the Restaurant Brands contact center where Unite and Supersizemypay had all those strikes.
Anyone been to Pak’n'S(L)ave in Glenn Innes lately? Go there about 4.30pm and you’ll see: they’ve hired a whole lot of kids who look about 10.. seriously.
Like or Dislike:
0 
0 (0)
It’s a good thing for young workers to have the same starting salary as adult.. as long as they can offer what adult can perform…
Like or Dislike:
0 
0 (0)