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Most UK bosses would back tougher employment laws to protect workers | Law



Business leaders would support tougher employment laws and a higher minimum wage to protect workers from exploitation and poverty during the second wave of Covid-19, according to a report.

The Centre for Progressive Policy (CPP) said urgent legal reforms were needed in the jobs market to prevent extreme levels of financial insecurity, in-work poverty and worker exploitation during the coronavirus emergency.

The thinktank said the end of the UK government’s furlough scheme later this week would dramatically increase the risk of widespread unemployment this winter, undermining the bargaining power of workers and leaving the door open to a rise in insecure work.

Calling for a shake-up of the law to halt a sharp increase in worker poverty, the thinktank said the government should ban zero-hours contracts and boost the minimum wage from its current level of £8.72 for over-25s. It also said a legal pay floor should be introduced for self-employed workers to protect them from exploitation.

The intervention comes as unemployment is expected to more than double by the end of the year to hit 1980s levels, from a rate of 4% before the pandemic struck to 12%.

Although free-market economists have argued that looser labour laws were among reasons Britain recorded a lower unemployment rate after the 2008 financial crisis compared with many other EU nations, the CPP said tighter restrictions were needed to safeguard workers’ rights. It said they could also be used by Boris Johnson to show the government was serious about his promise to “build back better” and “level-up” Britain’s lopsided economy.

The CPP, which is funded by Lord David Sainsbury, said as many as one in five workers in the health and social care sector work on zero-hours contracts, and that insecure contracts were most heavily used in the north-east.

In a sign of the appetite for change, it said business leaders had become more receptive to tougher labour market laws since the onset of the Covid emergency as companies require state support and as more households come under financial pressure.

According to a survey of 600 company bosses, 64% would back tightening existing labour market regulations, including an increase in the minimum wage. It said 40% of employers felt more responsibility to offer secure job contracts to staff in response to Covid-19, while a quarter would support further restrictions or a ban on the use of zero-hour contracts.

With the government under mounting pressure to fund free school meals and to tackle child poverty, the CPP said there was clear evidence that tougher labour market laws could also be used to protect families from falling below the breadline.

Research from the Joseph Rowntree Foundation shows in-work poverty has been increasingly driven by the impoverishment of working parents. According to figures from Eurostat, the UK also has one of the highest levels of workers at risk of poverty in Europe, with British workers more than twice as likely to fall into poverty as those in Ireland and Belgium.

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Figures from the Office for National Statistics earlier this summer, revealed a rise in zero-hours contracts to the highest level on record. The number of people on zero-hours contracts increased by 156,000 in the three months to July, or by 17.4%, to 1.05 million.

Rosie Stock Jones, senior research analyst at the CPP, said: “Maintaining a system that legitimises the exploitation of society’s most important workers and contributes to rising levels of in-work poverty can no longer be acceptable. If the government truly wants to level up the country and empower more people to contribute to and benefit from increasing prosperity, they must deliver proper protections and improved conditions for our lowest paid workers.”

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Nordstrom shares rise as retailer’s earnings top estimates




Pedestrians pass in front of a Nordstrom Inc. store in the Midtown neighborhood of New York, on March 20, 2020.

Gabby Jones | Bloomberg | Getty Images

Nordstrom shares got a lift Tuesday after the department store reported that its third-quarter sales picked up more than analysts had anticipated, suggesting it might have a stronger holiday season than some investors expected if trends continue.

Nordstrom shares were up more than 4% in extended trading Tuesday.

Nordstrom CEO Erik Nordstrom said the retailer has made strides with its online business, especially since its stores were temporarily shuttered. Digital sales in the three-month period were $1.6 billion and represented 54% of the retailer’s business.

He said the company is “continuing to amplify categories that are relevant with customers during the pandemic, such as activewear and wellness products. Yet he said it’s also looking toward the future with the Covid-19 vaccine and anticipates “pent-up customer demand, particularly around occasions like travel or in-person social events.”

He said the retailer’s off-price store, Nordstrom Rack, could be a major growth driver because it’s one of the few in this category with a large online presence. The company will expand its inventory, particularly at the lower price point, he said.

Here’s how the company did in the fiscal third quarter ended October 31, compared to what analysts were expecting, based on Refinitiv data:

  • Earnings per share: 34 cents vs. a loss of 6 cents expected
  • Revenue: $3.09 billion vs. $3.10 billion expected

Nordstrom said its net income fell to $53 million, or 34 cents per share, from $126 million, or 81 cents per share, a year earlier. Analysts surveyed by Refinitiv on average had expected the company to post a loss of 6 cents per share.

Total revenue for the company fell to $3.09 billion from $3.67 billion a year ago, and was lower than the $3.10 billion that analysts were expecting.

Nordstrom was among the retailers that were forced to close their doors in the early days of the coronavirus pandemic. Total sales were down 40% in the first quarter and 53% in the second quarter compared with the same period a year earlier.

In the third quarter, total sales were down only 16%. That includes an approximately 10-percentage point impact from the Anniversary Sale.

“Our Anniversary Sale serves as a strong proof point in our ability to amplify relevant categories, brands and trends to meet shifting customer preferences,” Chief Financial Officer Anne Bramman said during a conference call.

During the quarter, the company said its top performing merchandise categories were activewear, home, beauty and designer.

On the conference call, Bramman said the company expects sales to decrease in the low 20-percentage range in the fourth quarter. But the company expects to deliver positive operating cash flow, she said.

Yet she acknowledged the outlook is uncertain because of the pandemic and said that its expectations are based on stores remaining open.

Read the full earnings release here.

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Gap, Nordstrom, Dell Technologies & more




Check out the companies making headlines after hours on Tuesday:

HP Inc. — Shares of the computer hardware builder jumped more than 7% in after-hours trading on the back of stronger-than-expected quarterly results. HP Inc. posted earnings of 62 cents per share on revenue of $15.26 billion. Analysts expected a profit of 52 cents per share on revenue of $14.72 billion, according to Refinitiv. The company also issued better-than-expected earnings guidance for its fiscal first quarter.

Gap — Gap reported disappointing quarterly earnings after the bell, sending the retailer’s stock down more than 6%. The company earned 25 cents per share in the previous quarter, while analysts polled by Refinitiv had forecast a profit of 32 cents per share.

Nordstrom — Nordstrom shares gained 4.4% even after the company posted a disappointing revenue number for the third quarter. Nordstrom said its revenue for the quarter came in at $3.09 billion, just shy of a Refinitiv estimate of $3.1 billion. Nordstrom also reported earnings per share of 34 cents, but CNBC could not determine if that number was comparable to a Refinitiv forecast.

Dell Technologies — Dell Technologies reported third-quarter earnings and revenue figures that topped analyst expectations, sending the computer builder’s stock up nearly 2%. Dell earned $2.03 per share on revenue of $23.48 billion. Analysts had forecast earnings per share of $1.40 on revenue of $21.85 billion, according to Refinitiv. The company also posted sales for its subscription and “software as a service (SaaS)” that surpassed estimates.

American Eagle Outfitters — American Eagle Outfitters saw its stock fall more than 3% on the back of mixed third-quarter results. The retailer earned 35 cents per share, topping a forecast of 34 cents per share. Revenue for the company came in at $1.03 billion, in line with expectations.

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Texas food bank doubles amount of people it serves amid Covid




Eric Cooper, CEO of the San Antonio Food Bank, told CNBC that his Texas food bank now feeds double the amount of people it used to compared to before the coronavirus pandemic gripped the United States. 

“Pre-pandemic we fed about 60,00 people a week and now we’re seeing about 120,000 per week, and most of those are new to the food bank, and have never had to ask for help before,” Cooper said during a Tuesday evening interview on “The News with Shepard Smith.”

Cooper’s food bank serves eight semi-truck loads of food per day to people in need. The numbers are so high, they have to ration food. Organizers at the Rhode Island Community Food Bank say that one in four people can’t meet their basic food needs. That’s the highest since the Great Depression. 

According to Feeding America, 54 million people in the United States don’t have access to sufficient food. That’s approximately 13 million more than last year and more than the combined populations of Texas and Florida.

“Today we had a distribution that fed 2,000, and we have these distributions all the time,” Cooper said. “Food banks around the country have seen this unprecedented demand, and we’re just working as hard as we can to balance the private donations we get, with the public assistance to try to make sure people are fed.” 

In the South, the positivity rate is at 11% and the region accounts for about one-third of all coronavirus deaths and hospitalizations nationwide, according to a CNBC analysis of Johns Hopkins data. On Tuesday, Texas reported an all-time high with nearly 14,000 new cases. Cooper told host Shepard Smith that distance learning has been putting extra stress on parents when it comes to providing food for their kids. 

“A child would miss 10 meals in a week, and if a mom has two to three kids in school, she’s now feeling the impact of the cost of that food at home, and without employment, kids are going hungry,” Cooper explained. “We’re hearing from schools that kids are struggling with their education, because they don’t have access to good nutrition.” 

As food insecurity rises, federal funding has been critical with the Coronavirus Food Assistance Program, which provided $850 million to food banks this year. Cooper said that he hopes Congress acts swiftly to support families to get them out of lines for food banks and into grocery stores. 

“We just hope that Congress acts quickly, the stimulus package needs to support families to put food on their table,” Cooper said.

Cooper said that if someone wanted to help, they should visit, find their local food bank, and get involved through donating food, volunteering or making a financial contribution.

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