Draft regulations have now been published which will make the following main changes to the National Minimum Wage with effect from 1st October 2010:
- the principal rate of the national minimum wage increases from £5.80 to £5.93 per hour;
- the age at which the principal rate becomes payable is reduced from 22 to 21;
- the rate for workers aged between 18 and 20 increases from £4.83 to £4.92 per hour;
- the rate for workers aged below 18 who have ceased to be of compulsory school age increases from £3.57 to £3.64 per hour;
- apprentices employed under a contract of apprenticeship who are within the first 12 months of that employment or who have not attained the age of 19, will receive a national minimum wage of £2.50 per hour;
- the “accommodation amount”, applicable where an employer provides a worker with living accommodation, increases from £4.51 to £4.61 per day.
Although there is no formal confirmation yet on the Agricultural Wages Board website, it is understood that the annual review of the agricultural minimum wage (effective on 1 October each year) has settled on an average increase of 2.4% from 1 October 2010. An Agricultural Wages Order can be expected in due course.
Meanwhile, Boris Johnson, the mayor of London, has announced a 25p increase in the London living wage, bringing it to £7.85 per hour. There is of course no statutory compulsion on London employers to pay more than the national minimum wage. The London living wage is calculated by the Greater London Authority and is designed to take into account higher costs of living in London rather than elsewhere. There is a web-page listing employers who have committed to pay London staff the London Living Wage rather than the National Minimum Wage.
Finally, it is worth noting that the NMW has teeth. An optician in Manchester, Benjamin Gains, has recently been fined £3,696 for National Minimum Wage offences. He had paid his staff up to 40% less than that to which they were entitled and attempted to hide the fact that he wasn’t paying what he should by falsifying employee information.