Hospitality sector needs to up workers’ wages

The London Assembly today urged Mayor Sadiq Khan to encourage the hospitality industry in London to improve working conditions for its employees and to adopt conditions similar to New York.

During Living Wage Week, the Mayor recently announced that the London Living Wage will rise by 35p to £9.75 per hour next year.

The Assembly called on the Mayor to undertake an evidence-led review of the benefits to the hospitality sector of paying the London Living Wage.

Fiona Twycross AM, who proposed the motion said:

“With London’s tourism industry a major contributor to our capital’s economic success, it’s vital that hospitality workers are paid well and treated decently. We know that too often this isn’t the case. London faces increasing global competition for tourism, and we need to ensure the sector retains and values its workers, including those from the European Union.

It’s not just the right thing to do, it is also simply bad business sense not to pay staff properly, particularly if that means high turnover costs. An evidence-led review from the Mayor of the kind we’re proposing should show the hospitality sector that it pays off to pay well.”

The full text of the amended Motion is:

This Assembly is deeply concerned by the low-pay and unethical practices that characterise large parts of London’s hospitality sector, with research undertaken by Unite the Union showing that 63 per cent of workers in hotels and restaurants are paid less than the London Living Wage.

The hospitality and tourism industry is an essential component of London’s economy. More than 30m UK and international tourists visited London in 2015, contributing £15bn to the U.K economy. This Assembly notes that staff turnover costs hospitality employers in London £274 million annually. This situation is likely to be exacerbated by the consequences of Brexit, with one in eight employees in London coming from the European Economic Area (EEA), a third of which make up a third of employees in London’s accommodation and food services.

This Assembly believes that hotel chains operating in the capital have a social and moral responsibility to treat their workers ethically. That means paying staff a wage they can live on; providing safe, secure work and guaranteed hours every week; and offering training, development, and career opportunities. Ethical treatment of staff leads to greater productivity, staff retention and a more positive image to promote, which translates in to significant savings for business.

This Assembly calls on the Mayor to encourage the hospitality industry to improve conditions and promote best practice similar to conditions in New York where room attendants receive a pay of at least £16 per hour. The Assembly also calls on the Mayor to undertake an evidence-led review of the financial benefits to the hospitality sector of paying the London Living Wage and pursuing employment practices that encourage workers to remain within the industry.

The Assembly calls on the Mayor to encourage the Minister responsible for Her Majesty’s Revenue and Customs, Damian Hinds MP, to engage with HM Revenue and Customs to ensure that the implementation of the minimum wage is proactively enforced.

The Assembly notes that failure to enforce the minimum wage properly creates an environment where human trafficking can flourish.