MP suggests boycott of M&S at Christmas in row over overtime pay

She said the high street favourite had offset the cost of the new £7.20 per hour national living wage by cutting double time pay and the money staff receive for working unsociable hours.

Speaking during a Commons debate on the national living wage, she hit out at the firm's chief executive Steve Rowe for overseeing these changes while refusing to have a pay cut himself.

She said: "Steve Rowe, the chief executive of Marks and Spencer, is still refusing to meet with MPs to discuss these changes and he has not accepted that he should have a pay cut in solidarity with his shop floor staff.

"I hope members will bear all of this in mind when they are doing their Christmas shopping at M&S next month."

Ms McDonagh told the Commons that 11,000 staff at Marks and Spencer would be adversely affected.

Of these, 2,700 members of staff will lose at least £1,000 and 700 employees will lose at least £2,000, she said.

"A significant proportion will lose up to £6,000 a year," she added.

"The human cost of these actions is huge."

The company's board is due to meet on Friday to finalise these contractual changes, with notices being sent to staff just before Christmas, said Ms McDonagh.

She also accused fellow household name B&Q of similar practices, saying double-time pay and seasonal bonuses were set to be cut, costing some staff thousands of pounds a year.

Speaking in a backbench business debate on the issue, Ms McDonagh said: "Thousands of employees at these two companies will never earn again what they earned in April."

She added: "What is so shocking is the ease and speed with which these companies have legally cut staff pay.

"Both companies launched 90-day consultations, which is the statutory minimum. Neither company recognises a trade union. Both companies targeted those workers on older contracts.

"And both companies conducted consultations which ended with these pay cuts pushing through, regardless of their employees' heartache and the reputation damage that they have faced."

And she warned that other high street names including John Lewis look set to follow M&S in this "race to the bottom".

She said Cafe Nero and the chain restaurant Zizzi have both cut the free food they give to their staff.

Ms McDonagh added: "Meanwhile, the John Lewis partnership, the top retailer in our high street, looks like it will be the next big employer to cut staff pay potentially going the same way as M&S and B&Q."

She urged the Government to tackle the "unscrupulous" pay policies of employers.

Conservative MP James Berry (Kingston and Surbiton) said customers who are not happy with a firm's policies can take direct action, but did not reveal if he planned to take up the tactic.

He said: "We, as customers, can also take direct action by not shopping at Marks and Spencer this Christmas if we are not happy with how they treat their staff."

Business minister Margot James said the Government's national living wage was now the "highest minimum wage that the country has ever seen, not just in cash terms but also when taking account of inflation".

She insisted businesses must be able to cope with any required increases in wages.

She said: "Higher pay does need to be affordable for employers because if employers can't afford to pay it then they won't hire workers and, worse still, might even lay workers off."

Ms James said that while the Government sets the minimum wage, ultimately "it has to be for employers to decide how they manage those increases in their costs".

She rejected the idea that employers are using loopholes to pay for the increase.

She said: "The reason I don't see these matters as loopholes is that there is no proof that there is a connection between the national living wage introduction of and some of the cases that we have heard about this afternoon."

Ms James said Marks and Spencer is introducing its own living wage worth £8.50 with about 90% of employees due to receive higher pay because of the changes.

Labour MPs heckled Ms James as she defended the retailer, but she said: "I make no apology for trying to set the record straight.

"Honourable members are free in this House to speak without fear or favour and I make no apology for trying to set the record straight when I feel that a company or maybe an individual in the outside world has been maligned unfairly."

Labour's Liz McInnes (Heywood and Middleton) read out the views of a constituent who has worked for Marks and Spencer for 34 years.

MPs heard Ms McInnes's constituent wrote: "I feel I've been blackmailed and threatened to sign the form to accept the small payout because I was told I would not receive this otherwise.

"Also they would change my contract and that would mean I'd have to start working Sundays and work all bank holidays. No matter what they say the loyal, long-service worker has been sold down the river and threatened."

Ms McInnes said her constituent feels she has been "forced into an agreement" despite Ms James's "warm words".

Shadow business minister Jack Dromey said: "I have met myself with Marks and Spencer employees in my own constituency who are affected in exactly the way that was described.

"(Ms James) has therefore got to be careful not to end up sounding like she's an apologist for Marks and Spencer.

"I hope Marks and Spencer tomorrow hears the voice of this debate and does the right thing."

A motion which, among other things, noted the use of the national living wage to "drive down conditions and take-home pay is against the spirit of the law" and called on the Government to "close down those loopholes" which make this possible was approved unopposed.

A Marks and Spencer spokesman, in a statement, said: "Over 99% of colleagues have agreed to pay and pension changes which will reward our people in a fair and consistent way, simplify and modernise our business and make our colleagues amongst the highest paid in UK retail.

"The vast majority will receive higher total pay as a result of the pay changes and nobody need be worse off."