DEPARTMENT FOR
BUSINESS, ENTERPRISE AND REGULATORY REFORM News Release (2009/155)
issued by COI News Distribution Service on 12 May 2009
The government has
announced new National Minimum Wage rates to take effect in October.
* Low paid workers aged 22 and over can look forward to an
increase from £5.73 to £5.80 an hour.
* The rate for 18 to
21-year-olds will also rise from £4.77 to £4.83.
* For 16 and
17-year-olds, the rate will go up to £3.57 an hour from £3.53.
Nearly one million people will benefit from October's
increase after the government approved recommendations from the
independent Low Pay Commission.
Business Secretary Lord Mandelson said:
"The National Minimum Wage has been in place for 10 years
and remains one of the most important rights for workers
introduced in that time.
"I am very proud of the difference it has made to the lives
of the UK's lowest-paid workers. It protects them from
exploitation and also creates a level playing field for business,
making a huge contribution to the UK's economic success.
"The Low Pay Commission has carefully examined the latest
economic data before making their recommendations on the minimum
wage rate, balancing the needs of workers and businesses in the
current economic climate.
"The government agrees with this assessment and has accepted
the recommendations for these new rates to take effect in October."
The deadline for submission of the Low Pay Commission's
(LPC) recommendations to government was extended from February to
Friday 1 May to allow Commissioners to take into account the
latest possible economic evidence.
As well as the rate changes to take effect this year, the
government has accepted an LPC recommendation that the adult rate
of the minimum wage should be extended to 21-year-olds. This will
be implemented from October 2010.
The LPC also recommended that information should be available on
employers who have shown wilful disregard for minimum wage laws.
The government has today committed to develop proposals and
consider the practical issues involved.
Chairman of the LPC George Bain said: "These are very
challenging times for the UK and unprecedented economic
circumstances for the minimum wage. We believe that the Low Pay
Commission's recommendations are appropriate for this
economic climate. They reflect the need to protect low-paid
workers' jobs as well as their earnings.
"This was a difficult year for the Commission but our
evidence-based approach led to another unanimous Report. I am
delighted that the Government has again accepted our
recommendations on the rates this year."
Notes to Editors
1. The Low Pay Commission was established following the National
Minimum Wage Act 1998 to advise the Government about the National
Minimum Wage. Its commissioners include representatives from
business groups, trades unions and academics. For more details,
and copies of the full report, see http://www.lowpay.gov.uk/
2. When the minimum wage was launched, the main rate was £3.60.
3. The LPC makes recommendations to the government in its annual
report. This year, the Government has accepted the recommendations
that it:
* Ensures the commissioning policies of local authorities and the
NHS reflect the actual costs of care, including National Minimum Wage.
* Implement a policy of transparency on investigations of cases
of non-payment.
* Give urgent consideration to identify measures to address the
non-payment of the National Minimum Wage in the informal economy.
4. The accommodation offset will rise from £4.46 per day to £4.51.
5. The government will consider the LPC's recommendation on
introducing a minimum wage for apprentices and respond in full
this summer when it sets the LPC's remit for 2010.
6. The confidential National Minimum Wage helpline number is 0845
6000 678. The number for Northern Ireland is 0845 6500 207. As
well as receiving and investigating complaints about non-payment
of the minimum wage, the helpline offers advice and information in
more than 100 languages.
7. The Department for Business estimates that 950,000 to 1
million people stand to benefit from the October 2009 uprating of
the National Minimum Wage. The bottom of this range - 950,000 - is
based on the Office of National Statistics' Annual Survey of
Hours and Earnings (ASHE) 2008 data, and takes account of forecast
and actual average earnings growth (excluding bonuses) up to
October 2009. The top of the range - one million - reflects the
fact that there is more uncertainty this year. Figures are rounded
to the nearest 10,000.
8. Table - estimated number of workers that stand to benefit from
the October 2009 National Minimum Wage uprating by country and region:
Wales 54000
Scotland 81000
Northern 44000 Ireland
England 767000
North East 55000
North West 109000
Yorkshire and Humber 95000
East Midlands 76000
West Midlands 107000
Easterm 88000
London 74000
South East 95000
South West 68000
The Government also announced last week that minimum wage
regulations should be changed so that tips and service charges
could no longer be used to make up staff salaries to the minimum
legal level. This change will take effect in October this year.