Minimum wage to increase

United Kingdom
06/03/2001
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On 5th March the Government announced that it is to increase the national minimum wage from GBP 3.70 to GBP 4.10 on 1st October 2001. This rate will rise to GBP 4.20 from 1st October 2002 "subject to the economic conditions prevailing at the time". These rates will apply across the board- to part time and full time workers, to agency staff and those who work from home. It applies to all of those in work whatever the size of organisation that employs them.

These increases have been recommended by the independent Low Pay Commission, which has now published volume one of it's third report. The report concludes that the minimum wage has been a success with nearly one million workers benefiting without any adverse impact on employment or the competitive position of British business. In particular it states that over 70 percent of those benefiting are women and that the introduction of the minimum wage has had the greatest beneficial effect on women's pay since the introduction of the Equal Pay Act over 30 years ago.

The Commission's report finds that the estimated wage bill impact will be modest and will have no discernible impact on the main measures of inflation.

No increase for young workers (18-21 years old, inclusive) has been announced, so this will remain at GBP 3.20 per hour.

If you require any further information about the minimum wage or how it affects your business please contact Simon Jeffreys or Anthony Fincham by e-mail at [email protected] or [email protected] or alternatively by telephone on +44 (0)20 7367 3000.

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