The Government has
today written to the Low Pay Commission (LPC) setting out the
remit for their 2011 Report.
As with previous years the LPC will monitor, evaluate and review
the National Minimum Wage (NMW) and its impact, and review the
levels of each of the different minimum wage rates.
This year the LPC is also asked to pay particular attention to:
· the competitiveness of small firms; and
· the employment prospects of young people, including those in
apprenticeships and internships.
The LPC will report to the Prime Minister and the Secretary
of State for Business, Innovation and Skills by the end of
February 2011, with their recommendations for October 2011.
The Government has also today announced its response to the
recommendations in the LPC’s 2010 report and laid regulations to
bring these into force.
The new rates, which will come into effect on 1 October 2010 will
be:
· £5.93 per hour for low paid workers aged 21 and over, increased
from £5.80;
· £4.92 per hour for 18-20 year olds, increased from £4.83; and
· £3.64 per hour for 16-17 year olds, increased from £3.57.
For the first time there will also be an apprentice minimum wage
of £2.50 per hour. The new rate will apply to those apprentices
who are under 19 or those that are aged 19 and over but in the
first year of their apprenticeship.
Employment Relations Minister Edward Davey said:
“The increases to the National Minimum Wage this year are
appropriate for the economic climate. They will strike a balance
between helping the lowest paid whilst at the same time not
jeopardising their employment.
“The Low Pay Commission estimates that around 970,000 people
stand to benefit from these increases.
“Workers on the National Minimum Wage are disproportionately
likely to be employed by small firms and so it is right the Low
Pay Commission considers their competitiveness when they make
their recommendations for next year. SMEs will be vital to our
economic recovery”.
Notes for editors
1. The Low Pay Commission was established following the National
Minimum Wage Act 1998 to advise the Government about the National
Minimum Wage. Commissioners have backgrounds in business, trades
unions and academic labour relations. For more details, and copies
of the full report, see http://www.lowpay.gov.uk/
2. When the minimum wage was launched in 1999, the main rate was £3.60.
3. The LPC makes recommendations to the Government in its annual
report. In addition to the rate increases, the Government has
accepted the recommendations that:
there should be a single apprentice minimum wage rate of £2.50
per hour for those apprentices currently exempt from the National
Minimum Wage; there should be specific guidance on the National
Minimum Wage for the entertainment sector; andthat HMRC
investigates whether contract and agency cleaners in the hotel
sector are receiving their entitlement under the National Minimum
Wage for their hours worked.
4. The Government notes the Commission’s recommendation that
there should be a commitment, as a minimum, to maintaining current
funding in real terms for monitoring and enforcement of the
National Minimum Wage until at least March 2014.
5. The accommodation offset will rise from £4.51 per day to £4.61.
6. The Pay and Work Rights helpline number is 0800 917 2368. 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 Low Pay Commission estimates that just over 950,000 people
stand to benefit from the increase.
8. The remit for the Low Pay Commission’s 2011 report is to:
Monitor, evaluate and review the NMW and its impact, with
particular reference to:
the effect on pay, employment and competitiveness in the low
paying sectors, with particular reference to the competitiveness
of small firms;
the effect on the pay structures and employment of different
groups of workers, including in particular different age groups,
women, ethnic minorities, people with disabilities and migrant
workers.
Review the labour market position of young people, including
those in apprenticeships and internships.
Review the levels of each of the different minimum wage rates and
make recommendations for October 2011.
Review the arrangements for the apprentice minimum wage.
Report to the Prime Minister and the Secretary of State for
Business, Innovation and Skills by the end of February 2011.
Contacts:
BIS Press Office
NDS.BIS@coi.gsi.gov.uk
Matthew Barker
Phone: 020 7215 5946
Matthew.Barker@bis.gsi.gov.uk