Harman pays above minimum wage

An interesting news item today concerns the Labour MP Harriet Harman.  Apparently she has advertised for a trainee caseworker in her south London office on a salary of £17,000, which is a breach of parliamentary rules.

The Independent Parliamentary Standards Authority has fairly clear guidelines about how much MPs should pay their staff, and while these rules are open to revision, they do not currently permit lower payments to trainee staff.

However the purpose of this post is not to wag my finger at one particular MP.  Instead I want to consider the regulations themselves.

The minimum salary any MP may pay to any employee is currently £15,000, and that is outside Greater London.  The lowest permissible salary within Greater London is £17,000.  These figures are of course annual salaries, and not hourly rates, but I will assume that the rules envisage a thirty-seven hour working week.

The recommended hourly rates are therefore in the region of £8.84 within Greater London and £7.80 outside Greater London.  At the time of writing, the national minimum wage is £6.31 for someone aged 21 or older, whereas the IPSA guidelines make no mention of age.

Therefore the IPSA guidelines appear to envisage a minimum salary of 140 percent of the minimum wage within Greater London or 124 percent of the minimum wage elsewhere in the country - and that for someone in the 21 or over age bracket.  The percentages nearly double in respect of employees aged 16 or 17.

I have previously argued that employers should be banned from paying large salaries to senior staff unless not one of their employees earn less than ... 140 percent of the minimum wage.  (This would currently equate to £8.83 per hour – roughly £13,800 per annum for someone working thirty hours each week.)

I am pleased that MPs, who currently earn a minimum of £66,396, are expected to pay their employees more than the minimum wage.  However I would appreciate it also if the government would require other employers to be as considerate.

Related previous posts include:
Should we increase the minimum wage?
The minimum wage and prices