18th January 2016
A Labour government could stop corporations from sharing their profits with shareholders if they fail to pay employees the living wage.
BBS News reports that in a speech, Labour leader Jeremy Corbyn warned that he would target dividend payouts in a bid to take-on pay inequality.
Speaking to the Unite Union in Scotland he explained that he wanted to “institutionalise fairness” in the UK and that the Tory government wanted to “tip the scales further” in favour of company bosses.
Corbyn said: “Only profitable employers will be paying dividends; if they depend on cheap labour for those profits then I think there is a question over whether that is a business model to which we should be turning a blind eye.
“A more equal society is not only fairer, it does better in terms of economic stability and wealth creation.”
A Conservative Party spokesperson hit back at his claims and said that Labour was a “clear threat to our economic security”.
Nearly six million workers in Britain are paid less than the so-called living wage, which presently stands at £8.25 per hour – and £9.40 in London.
The government however is introducing a compulsory National Living Wage for over 25s starting at £7.20 an hour in April, with the aim of it climbing to more than £9 an hour by 2020.
Between July and the end of September last year, UK dividends reached a new record for a third quarter, of £27.2bn, according to Capita Asset Services.
The firm’s latest forecast anticipates that company payouts will hit £89.8bn in 2016.