Belle discusses the need for a campaign for the Living Wage in the beauty industry.
In the spring budget speech Phil Hammond split his own party by announcing a rise in national insurance contributions (NICs) for the self-employed. Though he U-turned on the policy for middle and high-earning workers, the policy still threatens to impact the income of the lowest-earning self-employed to the tune of up to £588.00 a year.
Alongside the rise in the NIC rate, there are major changes to universal credit. A recent study commissioned by the Labour MP Owen Smith found that self-employed single parents with two children earning £10,000 a year would lose 16% of their income, and those with a starting income of £20,000 would lose just over 12%.
Who is affected? The Office for National Statistics (ONS) describes a rising trend in self-employment: the level of self-employment in the UK increased from 3.8 million in 2008 to 4.6 million in 2015. Part-time self-employment grew by 88% between 2001 and 2015, compared to 25% for the full-time mode.The ONS reports that self-employment in the UK is at its highest level since records began almost 40 years ago, with taxi-driving, construction and carpentry among the most common jobs. The proportion of the total workforce self-employed now stands at 15% compared with 13% in 2008, and 8.7% in 1975. These include many families relying on a single self-employed wage.
This trend is reflected in at my own industry. I recently returned to working in hair and beauty after 26 years teaching in Further Education (FE) colleges, to be reminded that working conditions for most therapists are truly shocking. Despite this being a luxury service, wages and working conditions for most therapists (mostly made up of women workers) don’t match the image that the beauty industry projects. Some, like me, are directly employed by salons; many others are notionally “self employed”, but in practice answer directly to an employer; others work for themselves.
Many staff are on the minimum wage, even though a small salon in the right location can clear £3,000 to £4,000 a day in profit. Although the introduction of the national minimum wage does mean that employers are under pressure to follow government guidelines, employers can legally get away with paying less than the minimum wage because tips and commission are included as part of an employee’s wage, rather than a top-up reward. This is common practice across the hair and beauty industry, making it virtually impossible to earn a living wage.
Some salon owners prefer if their workers register as self-employed, meaning that workers earn a percentage of the revenue for services they perform. However, employers are allowed to set their own percentage rate (typically, 40%) and it’s quite common for them to subtract VAT upfront before allocating the therapist their percentage. A treatment in an upmarket salon in a posh area of North London attracting A-list celebs may cost the customer £100. The employer would subtract VAT upfront (£20), then split the remainder 60:40, leaving just £32 for the therapist. Additionally, under this type of contract, a worker has no job security, and no rights to sick pay, maternity or holiday entitlements. If a therapist falls sick, they don’t earn anything.
I would like to consider how to develop a collective resistance to these working conditions. It will not be easy, as most salons are small independent companies, which means workers would lack strength in numbers and attempts to organise would be affected by the high turnover of staff. Organising any rank and file workforce has always proven challenging in the beauty industry. Nevertheless, campaigning for the Living Wage across local businesses and organising staff to demand better working conditions and pay would be a good starting point.