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ETI NGO and trade union members, backed by ETI member companies, helped win amendments to the UK's National Minimum Wage Regulations (1999). This strengthened the entitlements of homeworkers and other piece-rate workers to the UK minimum wage.
Up to a million homeworkers in the UK work help produce, package, assemble or process a diverse range of products, from clothes, shoes and electrical components to gifts and greetings cards. Evidence from a variety of sources, including the former National Group on Homeworking and the TUC, contributed to a picture of exploitation and marginalisation.
In 2002, ETI members investigating wages paid to homeworkers making Christmas crackers in south Wales discovered that many were receiving shockingly low rates of pay - in some cases as little as £1.50 an hour.
One of the reasons for such low wages was that government regulations in place at the time, which were known as the ‘four fifths rule' and originally intended to protect slower-piece workers, had the effect of allowing employers to pay only 80 percent of the national minimum wage (see box).
Between 2002 and 2004, the UK Homeworker Group lobbied the then Department of Trade and Industry (DTI) to abolish the four fifths rule and introduce a fairer system for piece rate workers, also urging that statutory employment rights be conferred on UK homeworkers.
What was the four fifths rule?
The estimate was not regarded to be fair if it was less than four-fifths of the time an average worker would take to do the same amount of work in the same conditions. If no fair estimate was in place, the workers had to be paid the minimum wage for all hours actually worked.
In 2004, the DTI agreed to abolish the 4/5ths rule in favour of an accredited work measurement system, represented a significant advance for remaining homeworkers throughout the UK.